How to Fill Out and File Texas Form 651: Tax Clearance and Filing Steps

To dissolve a Texas business with the Secretary of State, you file Texas Form 651, the Certificate of Termination of a Domestic Entity, along with a $40 filing fee and a tax clearance certificate from the Texas Comptroller. That last piece trips up most first-time filers: without Form 05-359 attached, the Secretary of State rejects the filing. Form 651 covers for-profit corporations, LLCs, limited partnerships, professional associations, and other entities organized under the Texas Business Organizations Code. Nonprofits and cooperative associations use Form 652 instead.

Wind Up the Entity First

Form 651 is the last step. Before filing, the entity has to go through winding up, which is triggered by a voluntary vote of the owners or governing authority, expiration of the entity’s stated duration, an event specified in the governing documents, a statutory trigger under the Business Organizations Code, or a court decree.¹ Most voluntary dissolutions run on the first of these.

During winding up, the entity stops doing new business and focuses on collecting what it’s owed, paying creditors, and distributing what’s left to the owners. Secured creditors are paid first, unsecured creditors next, and equity holders last. Cancel any permits, licenses, and assumed name certificates the entity holds. Only when winding up is substantially complete should you move on to tax clearance and the filing itself.

Get Tax Clearance From the Comptroller

Section 11.101(b) of the Business Organizations Code requires that a certificate confirming all state taxes have been paid accompany the certificate of termination for any taxable entity under Chapter 171 of the Tax Code.² The document you need is Form 05-359, Certificate of Account Status. A standard printout from the Comptroller’s public search tool does not qualify; you need the actual Form 05-359 certificate.

Before requesting it, file a final franchise tax report with the Comptroller for the year the entity plans to terminate, and pay any amount owed.³ The Comptroller will not issue clearance while returns are outstanding or balances are unpaid.

Most entities can request the certificate online through the Comptroller’s website. Some have to submit a printed Form 05-359 by mail instead: entities that are part of a combined group, entities active for franchise tax for less than a year, limited liability partnerships, entities with an active audit, and entities not registered with the Secretary of State.⁴ Build in extra time if you fall into one of those categories.

How to Fill Out Form 651

The fillable PDF is on the Secretary of State’s website under business filings. You can type into the form fields before printing or saving.⁵

Items 1 Through 4: Entity Information

Enter the entity’s full legal name exactly as it appears on the original certificate of formation. Then provide the entity type (for-profit corporation, LLC, limited partnership, and so on), the date of formation, and the file number assigned by the Secretary of State. The instructions describe the entity type, date, and file number as recommended rather than mandatory, but providing them makes sure the filing gets matched to the right record without delay.⁵ You can look up your file number through the Secretary of State’s online business search if you don’t have it.

Item 5: Governing Persons

List the name and address of every governing person of the entity. For a corporation, that means each director. For an LLC, it’s each manager, or each member if the LLC is member-managed. If a governing person is an organization rather than an individual, use that organization’s legal name. An address is required for every governing person listed.⁵

Item 6: Event Requiring Winding Up

This is where most rejected filings go wrong. You must select one of the five options (A through E) that describes why the entity is winding up. Those options track the five events listed in Section 11.051. Most voluntary dissolutions fall under option A. The Secretary of State will reject the certificate if Item 6 is left blank.⁵

Signature

The form must be signed by someone authorized under the Business Organizations Code to act for the entity. For a corporation, that means an officer specifically, not a director and not a shareholder.⁵ For an LLC, a manager or authorized member can sign. The signer certifies under penalty of perjury that they are authorized to execute the document.

Filing Fee and How to Submit

The filing fee is $40.⁶ Credit card payments through the online portal carry a 2.7% statutory convenience fee on top.⁷ You have two practical options:

SOSDirect (online): The Secretary of State’s online filing portal accepts American Express, Discover, MasterCard, and Visa, and lets you upload the tax clearance certificate digitally. This is the fastest route.
Mail: Send the signed form, the original tax clearance certificate, and a check payable to the Secretary of State to Business & Public Filings Division, Office of the Texas Secretary of State, P.O. Box 13697, Austin, TX 78711.⁸

Mailed documents take at least one business day just to be entered into the system after arrival, and evidence of filing comes back by regular mail. The Secretary of State’s office encourages electronic filing for faster processing.⁷

Federal Tax Obligations Are Separate

Filing Form 651 ends the entity’s existence with the state of Texas. It does not close your accounts with the IRS. You still owe a final federal income tax return for the year the business closes, with the “final return” box checked at the top. Corporations file a final Form 1120; partnerships file a final Form 1065 and mark each Schedule K-1 as final. A corporation that adopted a resolution or plan to dissolve or liquidate stock also files Form 966. To close the entity’s EIN account, send a written request to Internal Revenue Service, Cincinnati, OH 45999 that includes the legal name, EIN, business address, and reason for closing; attach a copy of the original EIN Assignment Notice (CP 575) if you still have it.⁹ The IRS will not close an account with unfiled returns or unpaid taxes, so clear those first, and don’t forget final employment tax returns and any final information returns.

After the Filing Is Approved

Once the Secretary of State approves the filing, the entity’s public record shows a terminated status, and you receive a file-stamped copy of the Certificate of Termination. Keep it. You’ll need it to close business bank accounts, end commercial leases, and resolve remaining contractual matters.

Termination doesn’t make the entity vanish on the effective date. Under Section 11.356 of the Business Organizations Code, a terminated entity continues to exist for three years after the effective date of termination, but only for limited purposes: prosecuting or defending lawsuits, settling unfinished affairs, holding title to property that wasn’t distributed during winding up, and distributing remaining assets.¹⁰ The entity cannot use this window to resume normal operations.

If someone files a lawsuit against the terminated entity before the three years run out, survival extends further, until all judgments, orders, and decrees in that action have been fully executed.¹⁰ If there’s any realistic chance a creditor, customer, or former employee could bring a claim, the former owners and officers should retain key business records well past the termination date.

1
State of Texas. Texas Business Organizations Code 11-051 – Event Requiring Winding Up
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State of Texas. Texas Business Organizations Code 11-101 – Certificate of Termination
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Texas Comptroller. Franchise Tax
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Texas Comptroller. Requesting Tax Certificates and Tax Clearance Letters
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Office of the Texas Secretary of State. Form 651 – Instructions for Certificate of Termination of a Domestic Entity
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Texas Secretary of State. Form 651 – Certificate of Termination of a Domestic Entity
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Office of the Texas Secretary of State. Filing Options
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Office of the Texas Secretary of State. Contact the Corporations Section
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Internal Revenue Service. Closing a Business
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State of Texas. Texas Business Organizations Code 11-356 – Limited Survival After Termination