Texas franchise tax help
Keep the compensation figures clean so your CPA can elect the margin-tax deduction.
Franchise tax helpTexas · Professional Services Accounting
Texas professional-services accounting that shows which work pays.
Texas consultancies, agencies, and other professional firms run on billable time, projects, and partner economics. Your senior bookkeeper tracks project and client profitability, partner draws, contractor 1099s, and the margin-tax compensation figures, by person, so your CPA can take the deduction from the books.
Monthly bookkeeping: $500–$2,500+ a monthWhat sets the price
If your file needs our paid diagnostic first, its fee is credited in full against the cleanup. Either way, you get a fixed fee in writing before any work starts.
State rule
Texas rule: a firm subtracting compensation to figure its franchise-tax margin can count at most $480,000 of wages and cash compensation per person for reports due in 2026 and 2027; QuickBooks keeps pay by person, so the cap applies from the books. Source: Texas Comptroller, franchise tax.
§ The short version
Texas professional-services accounting from TechBrot tracks project and client profitability, partner draws and contractor 1099s for consultancies, agencies and other firms, and keeps compensation by person against the franchise tax’s $480,000 per-person limit for 2026 and 2027 reports. Monthly bookkeeping runs $500–$2,500+/mo. Law firms: Texas law firm bookkeeping and IOLTA records.
They took something that felt overwhelming to me as a first-year business owner and made it simple.
What stood out the most was TechBrot Inc’s attention to detail.
Intuit QuickBooks Certification Level 2 and QuickBooks Workforce Certification,
§ 01 · Why Texas professional-services books break
Three places Texas firms lose the numbers.
Utilization, partner draws and client pass-through costs are where it goes wrong. Knowing which one you’re in tells us where to start.
01Utilization
Work that doesn’t actually pay
Without project-level tracking, a firm sees revenue but not which engagements, clients, or service lines make money — and the unprofitable ones hide in the blended number.02Client costs
Client costs mixed into operating cash
Money a consultancy or agency holds for a client’s pass-through costs belongs on its own balance-sheet account, reconciled monthly, not in operating cash. Law-firm trust accounts follow their own Texas rules and are covered on Texas law firm bookkeeping and IOLTA records.03Partner draws
Partner draws & comp figures
Partner draws, guaranteed payments, and the compensation figures behind the margin tax get tangled — and untangling them is what makes both distributions and the tax accurate.§ 02 · What TechBrot handles
How we keep a Texas firm’s books by project.
Every engagement is scoped to your projects and partners, delivered in your own QuickBooks file by your TechBrot team, with every close reviewed by a Certified QuickBooks ProAdvisor.
01
Project & matter profitability
Time, costs, and billing tied to each project or engagement so real per-engagement and per-client profit is visible.
QuickBooks accountant02
Client pass-through accounts
Client money held for pass-through costs kept on its own balance-sheet account, reconciled monthly and out of the firm’s revenue. Law firms’ trust records are a separate engagement.
Texas law firm bookkeeping03
Partner-draw tracking
Partner draws, guaranteed payments, and capital accounts tracked cleanly so distributions and equity are clear.
Monthly bookkeeping04
Margin-tax compensation figures
Wages, guaranteed payments, and benefits kept clean and by person, against the $480,000 per-person limit for 2026 and 2027 reports, so your CPA can elect the compensation deduction on the margin tax.
Franchise tax help05
Contractor 1099s
1099 contractor records kept clean under the IRS common-law test, tied to the projects they work.
Bookkeeping services06
Firm & partner reporting
Reporting that shows firm profit and per-partner economics — CPA-ready and decision-ready.
Financial statements§ 03 · Tools we work alongside
Connected to how you bill.
- Project-management and PSA tools at the financial level
- Harvest, Toggl, and time-tracking tools
- QuickBooks Online or hosted Desktop — your file
- Gusto, ADP, and payroll providers
- Bill.com for vendor and subcontractor AP
- Stripe and professional payment processors
We reconcile alongside the project and time-tracking tools you already run — the books read from how you bill.
§ 04 · How engagements work
From blended revenue to matter-level profit.
Every Texas professional-services engagement follows the same rhythm — books accurate first, profitability visibility second, advisory third.
- Step 1
Free project & partner review
A QuickBooks ProAdvisor reviews your project tracking, partner setup, and compensation figures — at no cost. - Step 2
Written fixed-fee scope
A written scope and fixed fee within 3 business days — setup, cleanup, or monthly. - Step 3
Build profitability & partner figures
Project tracking set up, contractor costs tied to projects, any client pass-through accounts reconciled, partner draws and comp figures cleaned. - Step 4
Monthly matter-profit close
A monthly close showing engagement-level profit and partner economics, CPA-ready.
§ 05 · Beyond the books
Matter-level profit is the start. Partner returns are the point.
When engagement profitability is real and the partner figures are clean, the decisions get real: which clients and service lines to grow, how to set partner comp, whether to add a practice area, where utilization is leaking margin — answered from numbers that tie.
That’s where fractional-CFO advisory picks up, on cleaned-up books, in coordination with your CPA.
Checked against the Texas Comptroller (franchise tax) and Tax Code §171.1013.
§ 07 · Around this page
Around Texas.
Texas QuickBooks ProAdvisor & bookkeeping
The state page: services, industries, cities and the Texas tax terms in one place.Professional Services accounting, nationally
The national engagement this page is the Texas version of — same scope, same written fixed fee.Also in Texas
Other Texas industries
Texas cities
Not sure where your file stands? Start with the free QuickBooks file review · how Texas compares: state-by-state tax quirks.
§ 08 · FAQ
Texas professional-services accounting questions.
What does Texas professional-services accounting include?
Project and client profitability tracking, partner-draw and capital-account tracking, clean margin-tax compensation figures kept by person, and contractor 1099 records — in your own QuickBooks file, for consultancies, agencies, and other professional firms. Your CPA files. Law firms are covered on Texas law firm bookkeeping and IOLTA records.
Do you hold or disburse my law firm's IOLTA trust funds?
No. Law-firm bookkeeping, including the trust records, is covered on Texas law firm bookkeeping and IOLTA records, which sets out how that engagement works and who prepares and checks the trust reconciliation. Nobody at TechBrot ever holds or disburses client trust funds.
How do you track project and matter profitability?
We tie time, costs, and billing to each project or engagement so you see real profitability per engagement and per client, rather than a blended firm-wide number. That surfaces which work, clients, and service lines actually make money and which quietly run at a loss — pulling from your project and time-tracking tools.
How does the Texas franchise (margin) tax treat professional firms?
People-heavy professional firms often benefit from electing the compensation deduction on the franchise (margin) tax, since wages and guaranteed payments are substantial. Tax Code §171.1013(c) caps the wages and cash compensation counted for any one person per 12-month period, and for reports due in 2026 and 2027 the Comptroller sets that limit at $480,000; the same reports owe no tax at or below $2,650,000 in total revenue and are due May 15. We keep the compensation figures by person — wages, partner guaranteed payments, benefits — clean so your CPA can compute the margin and choose the most favorable deduction method. We track the figures; your CPA computes the liability and files.
How do you handle partner draws and guaranteed payments?
We track partner draws, guaranteed payments, and capital accounts cleanly and distinctly, so distributions, equity, and the compensation figures behind the margin tax are all clear. That keeps both the partners’ economics and the tax accurate, instead of tangled in a single owner-equity catch-all.
Do you work in my own QuickBooks file?
Yes — your file, your data, in QuickBooks Online or hosted Desktop, with a senior bookkeeper assigned to your file, and every close reviewed by a Certified QuickBooks ProAdvisor before it reaches you, connected to your project and time-tracking tools rather than proprietary software.
Texas professional-services firms start here