Is Your Business a Missed Filing Away from Forfeiture?

Your LLC or corporation falls out of good standing with the state, meaning you’ll be unable to obtain a Certificate of Status—a document often required for opening bank accounts, securing loans, or bidding on contracts.

If you’re not in good standing, you may be prohibited from conducting business with Texas state agencies, which can impact vendors and clients.

If you continue to ignore the filing requirements, the Texas Comptroller can forfeit your business’s right to operate in Texas. Eventually, the Secretary of State may involuntarily terminate or revoke your business entity.

Once your business is forfeited, the protection of limited liability disappears. Owners, directors, or managing members could become personally liable for any business debts or obligations incurred after the forfeiture date.

A forfeited business also loses the right to sue or defend itself in court—which can become a major legal disadvantage if disputes arise.