What Texas Form 05-359 (2012) Is For
Texas Form 05-359 is used to request a Certificate of Account Status from the Texas Comptroller of Public Accounts when a business plans to end its legal existence or registration in the State of Texas. This certificate serves as official proof that the entity has satisfied all Texas Franchise Tax obligations and related tax reports required by law.
The Certificate of Account Status is a mandatory document that must be filed with the Texas Secretary of State before most taxable entities can terminate, withdraw, or complete specific legal actions. Without it, the entity remains active in state records and continues to incur franchise tax filing and tax payment responsibilities.
Texas Form 05-359 applies to most taxable entities, including corporations, limited liability companies, limited liability partnerships, and entities taxed as corporations. Nonprofit entities and specific exempt organizations may not be required to obtain this certificate, depending on their exempt status.
When You’d Use Texas Form 05-359 (2012)
A business owner uses Form 05-359 during the process of terminating or withdrawing a business registration in the state of Texas. It is typically filed after all required franchise tax obligations have been met but before submitting termination documents to the Texas Secretary of State.
Typical situations where this form is required include voluntarily dissolving a Texas LLC, withdrawing a foreign entity’s registration, merging entities, or completing an involuntary dissolution that requires tax clearance. It may also be needed in court proceedings or administrative actions involving the legal status of a business.
If a business has failed to file tax reports or make required tax payments in prior years, those issues must be resolved first. Late or amended Texas Franchise Tax filings, including an amended Texas franchise tax return, must be submitted and paid before the Texas Comptroller will issue a Certificate of Account Status.
Key Rules or Details for 2012
To qualify for a Certificate of Account Status, the entity must be in good standing with the Texas Comptroller of Public Accounts. This means all franchise tax reports, public information reports, and ownership information reports must be filed, and all balances must be paid in full.
The Comptroller will not issue a certificate if the entity has unpaid franchise tax, outstanding penalties, unresolved audits, or missing reports. Entities that are part of a combined group or have forfeited their status may be required to submit additional documentation or use paper filing instead of the Franchise Tax Webfile.
The Certificate of Account Status issued for termination purposes is valid only through December 31 of the year it is issued. If the termination filing is not completed with the Texas Secretary of State by that date, a new certificate must be requested.
Step-by-Step (High Level)
Bring the Account Current
- File all required franchise tax reports for each applicable tax year.
- Submit any missing public information report or ownership information report.
- Pay all franchise tax, penalties, and interest due.
File Final or Amended Reports
- File a final Texas Franchise Tax report covering the last period of business activity.
- Submit an amended Texas franchise tax return if prior filings were incorrect.
- Ensure total revenue and deduction figures are accurate.
Request the Certificate
- Complete Texas Form 05-359 using the correct business name and taxpayer number.
- Request the Certificate of Account Status through Franchise Tax Webfile or by paper filing.
- Verify compliance with PCI DSS requirements if filing electronically.
Receive and Review the Certificate
- Confirm the certificate states it is for termination purposes.
- Verify entity details, legal status, and validity date.
- Retain copies for records and filing.
File with the Secretary of State
- Submit termination documents to the Texas Secretary of State.
- Include the Certificate of Account Status and required filing fee.
- Complete business registration closure.
Common Mistakes and How to Avoid Them
- Requesting the certificate before all tax reports and payments are processed: File every required report and satisfy payment obligations before requesting tax clearance from the Texas Comptroller.
- Submitting the wrong document to the Secretary of State: Use the termination-specific Certificate of Account Status rather than a Certificate of Status or an online account printout.
- Trying to terminate a forfeited LLC without restoring good standing: Resolve outstanding franchise tax obligations and reinstate the entity before proceeding with termination filings.
- Failing to close related tax accounts: Close sales tax permits and file any required final sales tax returns because the Certificate of Account Status does not close those accounts.
- Skipping a final compliance check before filing termination paperwork: Confirm all tax accounts, reports, payments, and entity information are current so termination is not delayed by follow-up notices.
What Happens After You File
Once Texas Form 05-359 is approved, the Texas Comptroller issues a Certificate of Account Status confirming that the entity has no outstanding franchise tax liabilities. This certificate allows the business to proceed with termination or withdrawal filings.
After the Texas Secretary of State processes the termination, the entity’s legal status changes to terminated or withdrawn. Franchise tax filing obligations end at that point, but the business owner must retain records related to business debts, tax payment history, and federal tax filings.
Termination with the State of Texas does not affect federal tax responsibilities. The entity may still need to file final federal tax returns and address any remaining federal tax obligations separately.
FAQs
Who must file Texas Form 05-359?
Any taxable entity required to obtain tax clearance before terminating or withdrawing its registration in Texas must file this form.
Is there a filing fee for Form 05-359?
The Texas Comptroller does not charge a filing fee to request the Certificate of Account Status, but the Texas Secretary of State charges a filing fee for termination documents.
Can Form 05-359 be filed online?
Eligible entities can request the certificate through the Franchise Tax Webfile using a valid Webfile number; others must submit a paper form.
What if the entity has an unpaid franchise tax?
The certificate will not be issued until all franchise taxes, penalties, and interest are paid in full.
Does this form affect federal tax obligations?
No, Texas Form 05-359 only addresses state franchise tax and does not replace federal tax filing requirements.
Is this the same as a Tax Clearance Letter Request for Reinstatement?
No, reinstatement typically uses Form 05-391 or Form 05-167, while Form 05-359 is used for termination or withdrawal.
Can this certificate be used outside Texas?
No, the Certificate of Account Status applies only within the State of Texas. It does not supersede the requirements of another state, such as those of the California Secretary of State.
