Filing Texas Form 05-904 for Veteran-Owned Business Certification

Texas Form 05-904, the Certification of New Veteran-Owned Business, is the one-page form you file to claim a five-year exemption from the Texas franchise tax. The form itself is short, but it only works when every owner of the business has already obtained a Veteran Verification Letter from the Texas Veterans Commission, and when you send the completed package to the right agency for your entity type.

Get a Veteran Verification Letter First

Before you touch the form, every owner needs a Veteran Verification Letter from the Texas Veterans Commission. The TVC’s Veteran Entrepreneur Program handles the request: each veteran certifies their status, the TVC confirms the honorable discharge, and the letter is issued with a unique alphanumeric identification code.¹ You will need that code to fill out Form 05-904.

Line up the letters before you file your formation paperwork. The Comptroller’s instructions require the letters to be submitted alongside Form 05-904 and your business formation documents.² If one owner is missing a letter, the filing is incomplete.

Confirm the Business Qualifies

Texas Tax Code Section 171.0005 sets three conditions. The entity must be chartered, organized, or otherwise formed in Texas. It must have first begun doing business in the state on or after January 1, 2022. And every owner must be a natural person who served in and was honorably discharged from a branch of the U.S. armed forces.³

The 100-percent ownership rule is strict. If even one owner is not an honorably discharged veteran, the business does not qualify. This applies across entity types — LLCs, corporations, partnerships, and professional associations face the same requirement. Because each owner must be a natural person, a business partially owned by a holding company or trust cannot use the exemption.

How to Fill Out Form 05-904

Download the current version (Rev. 2-26/3) as a PDF from the Texas Comptroller’s website.⁴ It is a single page. For each owner, you provide four pieces of information:

The entity name, matching the name on your Secretary of State formation documents exactly, or the name on your Texas Business Questionnaire (Form AP-224) if your entity type does not file with the Secretary of State.
The owner’s printed legal name.
The unique alphanumeric ID from that owner’s Veteran Verification Letter.
The owner’s percentage of ownership. Across all owners, the percentages must total exactly 100 percent.

Each owner signs at the bottom. Signing certifies that the business is 100 percent owned by honorably discharged veterans and that you will notify the Comptroller if ownership ever changes.⁴ If you have more owners than fit on one page, use additional pages and make sure the combined percentages still total 100 percent.

Where to Send the Form

The destination depends on your entity type. Sending the package to the wrong agency will delay your exemption, so check this before you mail anything.

If You File With the Secretary of State

Corporations, limited liability companies, limited partnerships, limited liability partnerships, and professional associations send three items together to the Secretary of State:²

The completed Form 05-904
A Veteran Verification Letter for each owner
The Secretary of State formation documents (Certificate of Formation or equivalent)

Mail the package to:

Texas Secretary of State
P.O. Box 13697
Austin, TX 78711-3697⁴

If You File With the Comptroller

General partnerships, joint ventures, trusts, business associations, and other entities that do not form with the Secretary of State send their package to the Comptroller instead:²

The completed Form 05-904
A Veteran Verification Letter for each owner
Form AP-224, Texas Business Questionnaire

Form AP-224 collects your entity name, federal employer identification number, entity type, formation date, NAICS code, and ownership details for all general partners and any limited partner holding 10 percent or more.⁵

Mail the package to:

Comptroller of Public Accounts
P.O. Box 149348
Austin, TX 78714-9348⁴

What Certification Gets You

Once verified, a qualifying new veteran-owned business pays no Texas franchise tax for its first five years. For reports originally due on or after January 1, 2024, a verified business also does not need to file the annual No Tax Due Report during the exemption period, which removes the yearly paperwork on top of the tax itself.⁶

One structural restriction applies during the five years: a new veteran-owned business cannot file as a member of a combined group or as part of a tiered partnership arrangement.⁶ If your plans involve combining with other entities for franchise tax reporting, that has to wait until the exemption period ends.

Keeping the Exemption After You File

If the business stops meeting the requirements at any point during the five years, the exemption ends immediately. The business becomes subject to franchise tax as of the date it no longer qualifies, and you must notify the Comptroller’s office.² The certification language on Form 05-904 itself commits each signer to report ownership changes.⁴

This is where businesses most often lose the exemption after a clean initial filing. Bringing in a non-veteran investor or partner at any percentage disqualifies the entire business, and once the exemption is lost mid-period, you cannot reclaim the remaining years. Plan ownership changes with that in mind.

1
Texas Veterans Commission. Tax, Fee Exemptions for New Veteran Owned Businesses Made Permanent
2
Texas Comptroller of Public Accounts. New Veteran-Owned Businesses and Texas Franchise Tax
3
State of Texas. Texas Tax Code 171.0005 – Definition of New Veteran-Owned Business
4
Texas Comptroller of Public Accounts. Certification of New Veteran-Owned Business
5
Texas Comptroller of Public Accounts. Texas Business Questionnaire
6
Texas Comptroller of Public Accounts. 2026 Franchise Tax Instructions