Every Texas employer must report employee wages and pay unemployment taxes to the Texas Workforce Commission (TWC) each quarter. Missing deadlines or reporting incorrectly can trigger penalties and audits. This guide walks you through the process step by step.
Step 1 — Register Your Business With the TWC
Before you can file quarterly reports you need a TWC employer account number. Register online through the TWC Unemployment Tax Registration system or mail Form C-1 (Employer Status Report). You will need your Federal Employer Identification Number (FEIN), business address, type of ownership, number of employees, and a description of your business activities. Once processed the TWC assigns your employer account number and initial SUTA rate.
Step 2 — File Quarterly Wage Reports on Time
Quarterly wage reports are due the last day of the month following each quarter. Q1 (January through March) is due April 30. Q2 (April through June) is due July 31. Q3 (July through September) is due October 31. Q4 (October through December) is due January 31. You report each employee’s name, Social Security number, and total wages for the quarter. File online through the TWC Employer Benefits Services (EBS) portal or by mail using Form C-3.
Step 3 — Calculate and Pay SUTA Taxes
New Texas employers pay 2.7% on the first $9,000 of each employee’s wages. Experienced employers receive a rate assigned annually based on their unemployment claims history and the state fund’s balance. Multiply each employee’s taxable wages by your assigned rate to calculate the payment due. Pay online through the EBS portal, by mail with a check, or via Electronic Funds Transfer. Payments must reach the TWC by the quarterly deadline — not be postmarked by it.
Common TWC Reporting Mistakes That Trigger Penalties
- Filing after the deadline — late reports carry penalties and interest
- Misclassifying employees as independent contractors and underreporting wages
- Reporting incorrect wages — tips, bonuses, and commissions are taxable wages
- Using the new employer rate when your business qualifies for an experience-based rate
- Failing to maintain payroll records for the required four years
How to Streamline TWC Reporting for Your Business
Set calendar reminders for all four quarterly deadlines at the start of each year. Use payroll software or outsource to a full-service provider who handles TWC reporting as part of their standard service. Tax by Lonestar manages TWC quarterly filings, calculates SUTA payments, and ensures timely submission for small businesses across Allen, Fairview, and Collin County.
Frequently Asked Questions About TWC Reporting
What is the TWC taxable wage base for 2026? The taxable wage base remains $9,000 per employee. What happens if I miss a quarterly filing deadline? The TWC can assess a penalty of up to 15% of unpaid taxes plus interest. How long do I need to keep payroll records for TWC purposes? Texas law requires employers to keep payroll records for at least four years. Can I file TWC reports online? Yes — the TWC Employer Benefits Services portal allows online filing and payment.
