Tax Billings and Past Due Taxes
Frequently Asked Questions
- What happens if I don't file my tax report?
- If you fail to file a required tax report, the Comptroller's office will send you an estimated billing, with instructions to file a report providing your actual sales data for the estimated period. Please be aware, that failure to file or pay a tax report may result in collection actions, including, but not limited to, additional late filing penalties, liens, and criminal charges.
- How do I calculate penalties and interest for past due taxes?
- Statutory penalty on past due taxes are calculated as follows:
- If you are paying the tax 1-30 days late, add a 5% penalty.
- If you are paying the tax 31-60 days late, add a 10% penalty.
- If you are paying the tax after the date referenced on the Notice of Tax/FEE Due, add an additional 10% penalty (for a total of 20%).
Statutory interest begins accruing on the 61st day after the due date of a required report. The interest rate is a variable rate determined at the beginning of each calendar year. To obtain the applicable rate for a specific tax period, please refer to the section titled Interest Rate Changes under Texas Taxes.
Additional late filing penalty
A taxpayer who fails to file a sales tax report timely on two or more occasions will be assessed an additional penalty of $50.00 for each subsequent late report to help offset the cost of collection. This penalty will be assessed even if the taxpayer later files the report and/or if no taxes are due for the reporting period.
- What happens if I underpay my taxes?
- If you have past due balances, the Comptroller's office will send you a billing notice requesting that you pay the remaining balance. This balance is due upon receipt of the notice. You will receive a separate billing notice for each report period that is delinquent. This notice will outline how additional penalty and interest will be assessed. It also explains the process of requesting a hearing if you disagree with the billing notice. Lastly, it outlines the possible collection actions that the Comptroller may take to collect any delinquent balances.
- Who is OSI Collection Services, Inc., and what do I do if I get a billing notice from them?
- OSI Collection Service is a private collection service engaged by the Comptroller's office to collect past due tax accounts. If you get a billing notice from OSI Collection Service, you should remit the balance due in the envelope provided. All payments will be directed to the Comptroller's office and credited to your account.
- What happens if I refuse to file required tax reports or pay my past due taxes?
- Typically, the Comptroller's office will take the following collection actions to protect the state's interests and collect past due taxes:
- Require the taxpayer to post a security bond (up to $100,000 for a delinquent sales tax account).
- File a tax lien in applicable counties.
- Freeze and/or seize non-exempt assets.
- Suspend permits.
- File criminal charges.
- Place a “hold” on any outstanding state warrants payable to the taxpayer.
If you are past due in the payment of your taxes, please contact your local Comptroller's field office or call (800) 252-8880 to discuss your account.
- What should I do if I receive a Notice of Hearing to Cancel/Suspend my permit?
- If you fail to file a report, pay taxes, or post a security bond, the Comptroller's office may suspend any permit or license issued by this agency after conducting a hearing. You can avoid this hearing simply by filing and paying the past due period(s) and/or posting the required security bond. If you are unable to pay the past due taxes or post the bond, you should contact your local Comptroller's field office to schedule a time for your hearing. Failure to appear at this hearing may result in the suspension of any permit or license issued by this agency.
- Why does the Comptroller's office file tax liens?
- State law requires that all past due taxes, fines, interest, and penalties owed to the state must be secured by a lien. Please be aware that a tax lien could have a negative impact on your credit rating. If you are past due in the payment of your taxes, please contact your local Comptroller's field office or call (800) 252-8880 to discuss your account.
- Does the Comptroller's office ever seize assets to satisfy past due tax liabilities?
- In an effort to protect the state's interest, it is sometimes necessary for the Comptroller's office to seize and sell a taxpayer's non-exempt assets. If you are past due in the payment of your taxes, please contact your local Comptroller's field office or call (800) 252-8880 to discuss your account.
- What should I do if the Comptroller's office has started collection actions against my business?
- You should immediately contact the Comptroller's Enforcement Division by visiting your local Comptroller's field office or calling (800) 252-8880.
- Can I set up a payment plan with the Comptroller's office for past due liabilities?
- While taxes are always due on the due date, the Comptroller's office will consider payment plans on a case-by-case basis to avoid placing undue hardships on taxpayers. For additional information in this regard, please contact your local Comptroller's field office.
Please be aware that even if you enter into a payment plan, that your account is still considered delinquent and some collection actions will continue. For example, you will still receive billing notices, a lien will still be filed, and state warrants will still be placed on “hold.”
- How do I report a tax cheat?
- To report a company or individual you believe is cheating on their state taxes, you may call our Enforcement Division at (800) 252-8880 or contact your local Comptroller's field office. You should be prepared to give information regarding the business, such as its name, its location, its phone number, the owner's name, and a description of how the business is allegedly violating the tax law. If you choose, you may remain anonymous.
- What if I am contacted by the Attorney General's Office about a tax liability?
- When the Comptroller's office is unable to collect past due taxes, the delinquent account may be referred to the Attorney General's Office for further collection activity. After a case has been referred, the Comptroller's office no longer has jurisdiction and can only get involved if specifically requested by the Attorney General.
Failure to respond to notification from the Attorney General's Office may subject you to severe civil action.