Sell a business in Texas
When you sell a business in Texas, the state takes nothing from the gain: Texas has no personal income tax. The buyer withholds for unpaid taxes until the Comptroller clears you, and the margin tax is due only above $2.47 million of revenue for 2025 reports, $2.65 million for 2026.
Texas is among the five states with the most employer businesses. The state takes none of the gain. Expect a tax on the business itself on the way out, and a tax-clearance or bulk-sale notice before closing.
Tax on the gain: No state income tax.
Today
Where you stand
The starting point in Texas
The elements this touches
- TmTime The years before you want out. It feeds the exit-readiness score and never moves the price; every other decision is planned against it.
The deal team on what changes when you sell a business in Texas.
Before the letter of intent
What Texas takes
How is the gain taxed when you sell a business in Texas?
No personal income tax and no estate tax; the state takes only the franchise tax on the company margin, and most small sellers sit below its revenue threshold.
No state income tax.
A founder on film
On what he learned about tax on the way to the sale.
Lewis Titus Wastewater purification and manufacturing · Wyoming
No state tax on gains
Texas has no personal income tax, so a founder's gain on a sale carries no state tax.
Franchise tax on the margin
The franchise tax is 0.75 percent of taxable margin, 0.375 percent for retail and wholesale, and nothing is due below $2.47 million of revenue for 2025 reports.
No estate or inheritance tax
Texas levies neither an estate tax nor an inheritance tax.
The rate is the state's top rate on the gain for the year shown, the same figure as the indicator in the hero, so the two can never disagree.
The elements this touches
- TxTax Strategy The deal and entity structure, set before the letter of intent. FNDRS tracks whether it is in place. It never moves the price; it changes what you keep.
- ApAfter-Tax Proceeds What you keep at close. FNDRS records the pre-tax walk-away and the gap to your number. It never moves the price, and the tax on it is a question for your CPA.
Under contract and at closing
The rules of the sale
What are the rules for selling a business in Texas?
The buyer withholds for the seller's unpaid taxes unless the Comptroller certifies none are due, health care non-competes are now tightly capped, and no business-brokerage license exists.
01Buyer withholds until Comptroller clears
Under Tax Code 111.020 a buyer must withhold enough of the price to cover the seller's unpaid taxes until the seller produces a Comptroller receipt or no-tax-due certificate.
Texas Public Law, 2025
02Health care non-competes capped
SB 1318, effective 1 September 2025, limits physician, dentist, nurse, and PA non-competes to one year, five miles, and a buyout no higher than a year's pay.
Jackson Walker, 2025
03No business-brokerage license exists
Texas has no business-brokerage license; a real estate license is needed only when owned property or a lease is part of the deal.
Texas Association of Business Brokers, 2026
The elements this touches
- LcLegal & Compliance Contracts, licenses, and filings in order and enforceable. The FNDRS valuation reads it, and the score moves the multiple.
- DrData Room The documents a buyer will ask for, ready before they ask. FNDRS tracks it in the deal-readiness report card; it decides how fast and how cleanly a deal closes.
One thing you would not guess
Anyone in Texas can sell your company for a fee without a license, but the Comptroller requires a joint form before it will tell the buyer you owe nothing.
Since 15 March 2022 a certificate of no tax due must be requested on Form 86-114, a joint request signed by buyer and seller.
A sale in Texas
A roofing company in Texas
Members of the FNDRS M&A team advised on this sale. The business, the story it went to market with, and what buyers paid for it.
- The situation
- A residential roofer serving major Texas metros, with about $6 million of EBITDA going to market, strong crew retention, and steady referrals. The founder was not done building, but wanted to take risk off the table and add institutional firepower. After testing third-party CRMs, the company had built its own platform, which automated estimating, supplier ordering, and delivery of materials to the job site.
- The approach
- Ahead of launch, that software cut overhead and the reliance on admin and production specialists, and gross margins improved. The company went to market as a scalable, technology-enabled roofing platform, not as a contractor, in a focused process among private equity firms with a thesis in exterior services.
- The outcome
- Three offers came in above 9.0x EBITDA and several more above 8.0x. The company became the founding platform of a new investment at 9.5x, roughly 2.5x above the top of the industry's multiple range at the time. The founder rolled 40 percent into the new company and continues as CEO with a board seat; the rest was cash at close, with capital committed for add-on acquisitions across the Sun Belt.
Day 0, and the years after
After the close
What Texas lets the proceeds do
Since 2021 a Texas trust can run 300 years, which turned Texas into a dynasty-trust state for money that used to leave for South Dakota or Nevada.
Proceeds land. What the state keeps of them is settled above; what it lets them do from here is below.
HB 654 took effect 1 September 2021: a trust that becomes irrevocable on or after that date may last 300 years.
Where FNDRS comes in
Post-exit planning is the third act of the same engagement, done with outside experts, and it starts before the letter of intent, when a move or a trust can still change the answer.
FNDRSThe elements this touches
- EsEstate Architecture Trusts and ownership set up before the letter of intent. It changes what the family keeps, not what a buyer pays.
- ApAfter-Tax Proceeds What you keep at close. FNDRS records the pre-tax walk-away and the gap to your number. It never moves the price, and the tax on it is a question for your CPA.
People who walked it
Founders
Founders who worked with FNDRS, in their own words
From founders elsewhere
What founders say about working with FNDRS
No founder in Texas is quoted yet. These are founders in other states, quoted word for word, each described by role and state.
“I definitely don't think we'd be in the same spot without you guys.”
Founders in Texas
Texas owners on working with FNDRS
Short testimonials from owners who went through the FNDRS process. Most are under two minutes.
Nearby
Other states in the South
| South | Tax on the gain | Complexity | Deal volume |
|---|---|---|---|
| Alabama | 5% 2025 | Medium | Medium |
| Arkansas | 3.9% 2025 | Low | Low |
| Delaware | 6.6% 2025 | Medium | Very low |
| Florida | None 2025 | Medium | Very high |
| Georgia | 5.19% 2025 | Medium | High |
| Kentucky | 4% 2025 | Medium | Medium |
| Louisiana | 3% 2025 | Low | Medium |
| Maryland | 8.5% 2025 | Medium | Medium |
| Mississippi | 4.4% 2025 | Low | Low |
| North Carolina | 4.25% 2025 | Medium | High |
| Oklahoma | 4.75% 2025 | Low | Medium |
| South Carolina | 6% 2025 | Low | Medium |
| Tennessee | None 2025 | Low | Medium |
| Virginia | 5.75% 2025 | Medium | High |
| West Virginia | 4.82% 2025 | Medium | Low |
Your next step
The road starts with one step
Know where you stand in fifteen minutes, or talk the Texas sale through with a dealmaker. Either way, no pitch and no obligation.
Selling in Texas? Start with a conversation
No pitch and no obligation. If the honest answer is not yet, we will say so, and say what to work on.