How to Fill Out Texas Form C-3 (w/Examples) + FAQs

Texas Form C-3 is the Employer’s Quarterly Report that every Texas employer with at least one covered worker must file with the Texas Workforce Commission to report total and taxable wages and pay state unemployment insurance (UI) tax. The current revision (Rev. 01-2025) is the version you should use for any quarter ending in 2026, and it is filed alongside the wage-detail companion, Form C-4, through the Unemployment Tax Services portal.

More than 490,000 Texas employers file Form C-3 every quarter, and the TWC reports that roughly 11% of paper C-3 filings contain at least one math or wage-base error that triggers a notice, interest, or a penalty under Texas Labor Code Chapter 213. Getting C-3 right protects your FUTA 5.4% credit on federal Form 940, keeps your TWC tax rate stable, and avoids liens on your business assets.

In this guide, you will learn:

📅 Every C-3 deadline, fee, and penalty so you never file late
🧾 A line-by-line walkthrough of every box on the current C-3 form
👤 Three full filled-out scenarios using real-world employer fact patterns
💻 How to file by UTS online, QuickFile/EDI, mail, and in person
⚖️ How C-3 connects to Form C-4, FUTA, and Texas Labor Code Chapter 201

What the Form Is and Who Must File It

Texas Form C-3, the Employer’s Quarterly Report, is the official document Texas employers use to report total gross wages, taxable wages, and the state unemployment tax due for a calendar quarter. The form is authorized under the Texas Unemployment Compensation Act in Texas Labor Code Chapter 201, and it is administered by the TWC’s Unemployment Tax Department. Every “liable” employer must file C-3 each quarter, even if the employer paid no wages that quarter — a zero report is still required.

You are a liable employer in Texas if you meet any of the tests in Texas Labor Code §201.021, including paying $1,500 or more in gross wages in any calendar quarter, employing at least one worker for some part of a day in 20 different weeks, acquiring an existing liable business, or paying $1,000 or more in domestic service wages in a quarter. Agricultural employers are liable if they pay $6,250 or more in cash wages in a quarter or employ three or more farmworkers in 20 different weeks under §201.028. Nonprofit 501(c)(3) employers, governmental entities, and Indian tribes have separate liability rules and may elect reimbursing status instead of contributing status.

C-3 only reports the summary numbers and the tax due. The companion form, Form C-4 (Employer’s Quarterly Report of Wages Paid), reports each employee’s name, Social Security number, and gross wages for the quarter. The TWC requires both unless you file electronically, in which case the C-3 and C-4 data are combined into a single submission inside the UTS portal. Filing one without the other will not satisfy your quarterly obligation.

Before You Start: Documents and Information You Need

Before you open Form C-3, gather every record below. Missing any one item is the single most common reason a C-3 filing gets stuck, rejected, or assessed a penalty.

TWC Tax Account Number (9 digits): Without this, the TWC cannot match your filing to your account, and your payment will sit in suspense.
Federal Employer Identification Number (FEIN): Required for cross-matching with IRS Form 940 and for FUTA certification of state tax paid.
Quarter-end payroll register: Total gross wages for the quarter for every covered worker, used to compute Item 14 (Total Wages).
Year-to-date wages by employee: Needed to apply the $9,000 Texas taxable wage base correctly under §204.041.
Your TWC effective tax rate notice: Mailed each December as Form C-69; the rate prints on Item 17 and changes every January.
Number of covered workers for each month-12 pay period: Required for Items 11, 12, and 13 (the monthly employment counts for BLS/QCEW reporting).
County code for your worksite(s): A two-digit code identifying where most employees worked; use the TWC County Code List for the right number.
Multiple-worksite report data, if applicable: Employers with two or more worksites and 10+ employees in the secondary location must also file the Multiple Worksite Report (MWR).
Bank routing and account number: For ACH debit payment inside UTS, or a check made payable to Texas Workforce Commission for paper filers.
Prior-quarter C-3 confirmation number: Helpful for confirming year-to-date taxable wages and reconciling FUTA credit on Form 940.

If you do not have your TWC account number, you can recover it through the TWC Account Number lookup or by calling the TWC Tax Department at 800-832-9394. New employers must first register through the Unemployment Tax Registration system before they can file their first C-3.

Where to Get the Form and How to Access It

Most employers no longer touch a paper C-3. Once you register a TWC tax account, the agency mails a pre-printed C-3 each quarter only if you filed by paper the prior quarter; otherwise, the TWC drives you to file electronically. You can download a blank fillable PDF from the TWC Tax Forms page under “Unemployment Tax.”

The fastest and most accurate access point is the Unemployment Tax Services (UTS) portal, which is free, available 24/7, and supports up to 1,000 employees per filing. Larger employers and payroll service bureaus typically use the QuickFile wage-reporting system to upload an ICESA, MMREF-1, or fixed-length file with up to 100,000 employees per upload. CPAs and PEOs filing for many clients can also use the Employer Benefits Services (EBS) bulk filer with a single sign-on.

If you must file by paper because of a TWC waiver or because you are a brand-new employer who has not yet received online credentials, request a pre-printed C-3 by calling 512-463-2700 or visiting any TWC Tax Office. Photocopies of the pre-printed C-3 are not accepted because the form contains a scannable barcode tied to your account number; using a photocopy will route your filing to the unidentified-payments suspense queue.

Step-by-Step: How to Fill Out Texas Form C-3 Line by Line

The current C-3 (Rev. 01-2025) has 19 numbered items plus a signature block. Complete every box in the order below. Use blue or black ink for paper filings, write one character per box where the form is gridded, and round all dollar amounts to the nearest cent.

Item 1 — TWC Tax Account Number

The form asks for your nine-digit TWC unemployment tax account number, sometimes printed as XX-XXXXXX-X. Enter the number exactly as it appears on the pre-printed form or your most recent Form C-69 rate notice, including the dashes if the boxes are pre-formatted. Maria Lopez of Lopez Bakery LLC enters 12-345678-9. If you operate under a sub-account for a separate worksite, use the sub-account number, not the parent account. The most common mistake is using your federal EIN here instead of the TWC number, which causes the TWC to reject the filing as “account not found.” A misconception is that your EIN and TWC number are interchangeable — they are not, and the TWC system cannot translate one into the other automatically.

Item 2 — Federal Employer Identification Number (FEIN)

This box asks for your nine-digit IRS-issued FEIN in the format XX-XXXXXXX. Enter the FEIN that appears on your most recent IRS Form 941 and Form 940; do not use a Social Security number even if you are a sole proprietor without an EIN. Carlos Reyes, owner of Reyes HVAC Inc., enters 74-1234567. If you recently changed entity types (sole prop to LLC), use the FEIN of the entity that paid the wages during this quarter. Mismatched FEINs are the leading cause of FUTA 5.4% credit denials on Form 940 because the IRS cannot certify state tax paid back to your federal account. Many filers wrongly assume the FEIN is optional on C-3 — it is not, and TWC will reject paper forms missing it.

Item 3 — County Code

The county code identifies the Texas county where most of your employees worked during the quarter. Use the two-digit numeric code from the TWC County Code List; for example, Travis County is 227 and Harris County is 101. Aisha Patel, who runs a single-location boutique in Austin, enters 227. Multi-county employers report the county where the largest share of payroll was paid this quarter, not corporate headquarters. The most common error is entering the FIPS code (a three-digit federal county code) instead of the TWC two-digit code, which scrambles BLS/QCEW reporting. A common misconception is that the code never changes — it can change if your primary worksite moves, so verify each quarter.

Item 4 — Outside Texas (Out-of-State Wages) Indicator

This box asks whether any of the wages reported on this C-3 were earned outside Texas. Check “Yes” only if you are reporting a worker whose services are localized in another state but you are voluntarily reporting them to Texas under a reciprocal coverage arrangement under §201.045. Janet, the HR manager at a Houston-based logistics firm with one driver localized in Louisiana under a reciprocal election, checks Yes. If all your workers are localized in Texas, leave this blank or check “No.” Erroneously checking “Yes” can trigger a TWC audit and a duplicate-coverage inquiry from the other state. The misconception here is that any out-of-state travel triggers this box — it does not; only true reciprocal coverage agreements do.

Item 5 — Final Report Indicator

Check this box only if this C-3 is your last report because you closed the business, sold it, or no longer have any Texas employees. Marcus Lee, who sold his food truck on March 28, 2026, checks “Final Report” on his Q1 2026 C-3 and writes the date of the last payroll. If you simply have no wages this quarter but expect to resume, do not check this box; file a zero report instead. Checking “Final” by accident closes your TWC tax account and forces you to re-register before paying any future Texas wages. A widely held misconception is that “Final” means “done for the year” — it means permanently closed.

Item 6 — Reporting Period (Quarter and Year)

Enter the quarter (1, 2, 3, or 4) and the four-digit year being reported. For wages paid April 1 through June 30, 2026, enter 2 and 2026. The reporting period is governed by when wages were paid, not when work was performed, under §204.001. The most common mistake is reporting wages in the quarter they were earned rather than paid; this throws off the wage-base calculation and can trigger a notice. Filers often think the quarter follows the work week — it does not; it follows the paycheck date.

Item 7 — Mailing Address

Enter the legal mailing address where the TWC should send tax correspondence, including any Notice of Maximum Potential Chargeback. Lopez Bakery LLC, 1402 Cesar Chavez St, Austin, TX 78702. P.O. boxes are accepted, but the physical worksite address must still be reported on Form C-4 if different. An out-of-date address means you will miss your annual rate notice (Form C-69) and could be billed at a higher rate by default. Many filers wrongly believe address changes are picked up from the IRS — they are not; you must update TWC separately through UTS or by filing Form C-26.

Item 8 — Business Name (Legal Name)

Enter the exact legal name on file with TWC, not a DBA. Reyes HVAC Inc. — not “Carlos’s Heating.” If your legal name changed, file Form C-26 Status Report before submitting C-3 so the names match. A name mismatch will not stop processing, but it can delay rate-notice mailings and FUTA certification. The misconception is that DBAs are interchangeable with the legal name — they are not for tax-reporting purposes.

Items 9 and 10 — Phone Number and Email Address

Enter a daytime phone number and a monitored email address. 512-555-0144 and payroll@lopezbakery.com. The TWC sends rejection notices and audit requests to the email on file when UTS is used. Out-of-date contact info means you may miss a 30-day appeal window on a rate determination. Many small employers leave email blank thinking it is optional — UTS requires it, and paper filers who skip it will not receive electronic notices.

Item 11 — Number of Covered Workers in Pay Period Including the 12th of Month 1

Count every full-time and part-time worker who earned wages in the pay period that included the 12th of the first month of the quarter. Aisha Patel had 4 employees on the payroll covering April 12, 2026, so she enters 4. Include workers on paid leave; exclude unpaid leave and independent contractors. This number feeds the federal QCEW employment series, and zeros where wages exist will trigger a TWC reconciliation letter. The misconception is that you report the headcount on the 12th — you actually report the count for the pay period that includes the 12th.

Item 12 — Number of Covered Workers in Pay Period Including the 12th of Month 2

Repeat the same count for the second month of the quarter. Aisha had 5 employees in the pay period covering May 12, 2026, after a new hire, so she enters 5. Track new hires and terminations carefully; off-by-one errors are the most flagged BLS data point. The mistake of leaving Item 12 blank when wages exist makes the form mathematically inconsistent. Many filers wrongly assume the same count applies to all three months — it rarely does.

Item 13 — Number of Covered Workers in Pay Period Including the 12th of Month 3

Count workers in the pay period that included the 12th of the third month. Aisha had 5 employees again on June 12, 2026, so she enters 5. If you had zero employees in any month, enter 0; do not leave it blank. Blank fields are read as missing data and may produce a TWC inquiry letter. A common misconception is that seasonal employers can skip months — they cannot; report 0 for off months.

Item 14 — Total Wages Paid This Quarter

Enter the total gross wages paid to all covered workers during the quarter, before any deductions, including bonuses, commissions, tips, and the cash value of non-cash compensation under §201.082. Lopez Bakery paid $48,250.00 in Q2 2026 and enters 48250.00. Do not subtract Section 125 cafeteria-plan contributions; do exclude employer 401(k) matches and qualified expense reimbursements. Underreporting Item 14 is the single most common cause of a TWC audit assessment. Many employers wrongly treat taxable wages and total wages as the same — Item 14 is total, Item 15 is taxable.

Item 15 — Taxable Wages Paid This Quarter

Enter only the portion of each employee’s year-to-date wages up to the $9,000 Texas taxable wage base under §204.041. Once an employee crosses $9,000 YTD with you, none of their additional wages this calendar year are taxable. Reyes HVAC paid one employee $14,000 YTD by Q2 2026; only the first $9,000 is taxable, so $9,000 is added to Item 15 for that worker. Successor employers can credit predecessor wages toward the $9,000 base if they filed Form C-198. The biggest mistake is restarting the $9,000 base each quarter — it is annual, not quarterly. The misconception that bonuses and commissions are exempt is false; they count toward the wage base.

Item 16 — Taxable Wages from a Prior Quarter (Adjustment)

Use this line only when correcting a prior quarter’s taxable wages on the current C-3, in lieu of filing an amended report. Janet adjusts a $500 underreport from Q1 2026 by entering 500.00 here on the Q2 2026 C-3. For larger errors, file Form C-7 Adjustment Report instead. Misusing Item 16 to dump multiple-quarter corrections will trigger a TWC reconciliation that may delay your rate notice. The misconception is that Item 16 replaces C-7 — it does not for amounts over the de minimis threshold.

Item 17 — Tax Rate

Enter your TWC effective tax rate for the calendar year exactly as printed on your most recent Form C-69. For 2026, Lopez Bakery’s rate is 1.34%, so the entry is .0134. Rates range from the minimum 0.25% to the maximum 6.25% under §204.064, plus any obligation assessment. Using a stale rate from a prior year is the leading cause of underpayment penalties on C-3. The misconception is that the rate is the same for every employer — it is experience-rated and unique to your account.

Item 18 — Tax Due (Item 15 × Item 17)

Multiply taxable wages (Item 15) by your tax rate (Item 17) and enter the product. Lopez Bakery: $36,000 × 0.0134 = $482.40, entered as 482.40. Round to the nearest cent. Math errors here trigger a TWC math-correction notice and interest from the original due date. Many filers wrongly compute this against total wages — always use taxable wages.

Item 19 — Interest, Penalty, and Total Amount Due

If you are filing late, add interest at 1.5% per month and a penalty under §213.022 (the greater of $15 or a graduated percentage of the tax due, capped at $200 plus the tax). Marcus files Q1 2026 C-3 fifteen days late owing $300 tax; he adds the $30 penalty (the larger of $15 or the tier) plus partial-month interest. Total amount due goes here, and it must equal your check or ACH amount exactly. Filers commonly forget penalty even when they remember interest, leading to a residual balance and additional notices.

Signature Block — Owner, Officer, or Authorized Agent

Sign and date the C-3 with the printed name and title of the person legally authorized to bind the employer. Maria Lopez, Owner, signs and dates 07/15/2026. UTS filers e-sign with a TWC-issued user ID and password; that e-signature has the same legal force as an ink signature under §201.066. Unsigned paper forms are returned, and the filing date for penalty purposes becomes the date the signed form is received.

Three Filled-Out Examples Using Real Scenarios

Scenario 1 — Maria Lopez, Lopez Bakery LLC (Single-Location Small Employer, 5 Workers)

Maria runs a single bakery in Austin and paid $48,250 in gross Q2 2026 wages, with all employees still under the $9,000 YTD cap.

Form Section	What Maria Enters
Item 1 — TWC Account #	12-345678-9
Item 2 — FEIN	74-9876543
Item 3 — County Code	227 (Travis)
Item 6 — Quarter/Year	2 / 2026
Items 11/12/13 — Workers	4 / 5 / 5
Item 14 — Total Wages	$48,250.00
Item 15 — Taxable Wages	$36,000.00
Item 17 — Tax Rate	.0134
Item 18 — Tax Due	$482.40
Signature	Maria Lopez, Owner, 07/15/2026

Scenario 2 — Carlos Reyes, Reyes HVAC Inc. (Multi-Location, Wages Over Wage Base)

Carlos employs 12 workers across Houston and Pasadena. Several senior techs crossed the $9,000 YTD cap in Q1 2026, so Q2 taxable wages drop sharply.

Form Section	What Carlos Enters
Item 1 — TWC Account #	45-678910-2
Item 2 — FEIN	74-1234567
Item 3 — County Code	101 (Harris)
Item 6 — Quarter/Year	2 / 2026
Items 11/12/13 — Workers	12 / 12 / 11
Item 14 — Total Wages	$162,400.00
Item 15 — Taxable Wages	$41,200.00
Item 17 — Tax Rate	.0265
Item 18 — Tax Due	$1,091.80
Signature	Carlos Reyes, President, 07/22/2026

Scenario 3 — Aisha Patel, Patel Boutique LLC (New Employer Filing First C-3 Mid-Year)

Aisha registered with TWC on May 1, 2026, and is filing her first C-3 for Q2 2026 with two employees and the new-employer rate of 2.7%.

Form Section	What Aisha Enters
Item 1 — TWC Account #	99-112233-4
Item 2 — FEIN	87-6543210
Item 3 — County Code	227 (Travis)
Item 5 — Final Report?	No (leave blank)
Item 6 — Quarter/Year	2 / 2026
Items 11/12/13 — Workers	0 / 2 / 2
Item 14 — Total Wages	$11,800.00
Item 15 — Taxable Wages	$11,800.00
Item 17 — Tax Rate	.0270
Item 18 — Tax Due	$318.60
Signature	Aisha Patel, Member, 07/30/2026

How to File the Completed Form

Texas accepts four filing channels for C-3, but the TWC pushes electronic filing because it auto-validates math, the wage base, and the tax rate.

Unemployment Tax Services (UTS) online portal: File at apps.twc.texas.gov/UITAXSERV. No fee. Pay by ACH debit, credit card (with a third-party processor fee of about 2.25%), or TEXNET. Processing is real-time, and you receive a confirmation number to keep as proof of filing.
QuickFile / EDI bulk upload: Use the QuickFile program for ICESA, MMREF-1, or NACHA-formatted files. No fee. Best for payroll bureaus and employers with 1,000+ workers. Confirmation arrives by email within 24 hours.
Paper mail: Mail the original pre-printed C-3 (no photocopies) and a check payable to Texas Workforce Commission to TWC, P.O. Box 149037, Austin, TX 78714-9037. No filing fee, but processing takes 4–6 weeks. Keep the certified-mail receipt as proof of filing.
In person: Drop off at any TWC Tax Office during business hours; ask for a date-stamped copy as your proof of filing.

The quarterly due dates are April 30, July 31, October 31, and January 31. If the due date falls on a Saturday, Sunday, or state holiday, the deadline rolls to the next business day under §213.021.

What Happens After You File

Once UTS accepts your C-3, the TWC posts the tax to your account within 24 hours and the system updates your year-to-date taxable wage totals. Paper filings post within 10–15 business days of receipt. If the math reconciles and the tax is paid in full, you will not receive any follow-up correspondence; if not, the TWC mails a Statement of Account showing the deficiency, interest accruing daily, and any penalty.

Your filed C-3 data also feeds your annual experience rating computed each fall under §204.041, and is used to certify state UI tax paid for your federal Form 940 FUTA filing — preserving the 5.4% FUTA credit that drops the federal rate from 6.0% to 0.6% on the first $7,000 of each employee’s wages. If you filed late or unpaid, FUTA certification is denied, and you owe the IRS the full 6.0% federal rate.

If you discover an error after filing, file Form C-7 Adjustment Report within four years of the original due date under §213.075. Refunds for overpayments are issued automatically by ACH, but credits can also be applied to future quarters at your election.

Mistakes to Avoid When Filling Out the Form

Using your FEIN in Item 1 instead of your TWC account number — the filing routes to suspense and is treated as unfiled.
Restarting the $9,000 wage base each quarter — taxable wages are inflated and you overpay tax all year.
Reporting wages by earned date instead of paid date — wages land in the wrong quarter and trigger reconciliation.
Leaving Items 11–13 blank when wages exist — the TWC issues a BLS data inquiry and may delay processing.
Photocopying the pre-printed paper C-3 — the barcode is single-use and the copy is rejected.
Using a stale tax rate from a prior year — Item 18 underpays, generating interest and penalty.
Subtracting Section 125 contributions from Item 14 — Texas does not exempt cafeteria-plan contributions.
Forgetting to file when no wages were paid — a zero report is still required; failure-to-file penalty applies.
Skipping the signature block on paper C-3 — the form is returned and treated as not filed.
Mailing the check separately from the form — payment posts to suspense without the C-3 voucher.
Dumping multi-quarter corrections into Item 16 — use Form C-7 instead to avoid an audit flag.
Checking “Final Report” while still in business — closes the account and forces re-registration.

Do’s and Don’ts

Do file through UTS to auto-validate the wage base and your tax rate.
Do keep year-to-date wage records by employee so the $9,000 cap is applied correctly.
Do verify your tax rate from the most recent Form C-69 every January.
Do save your UTS confirmation number for at least four years per §213.075.
Do file even if you owe nothing — a zero report is mandatory.
Do update your address through Form C-26 before each quarter ends.
Don’t mix up total and taxable wages between Items 14 and 15.
Don’t mail photocopies of the pre-printed paper form.
Don’t sign in pencil or use white-out on a paper C-3.
Don’t wait until the due date to register a UTS user ID — activation can take 48 hours.
Don’t report independent contractors who receive a 1099-NEC; they are not “covered workers.”
Don’t assume the IRS will share an address change with TWC; they do not.

Pros and Cons of Filing on Your Own vs. With Help

Filing on Your Own	Filing With a Payroll Service or CPA
Pro: Free through UTS — no professional fees.	Pro: The provider tracks the $9,000 base across all clients.
Pro: Real-time control over filing dates and payments.	Pro: EDI bulk filing through QuickFile for many entities at once.
Pro: Direct visibility into TWC notices in your UTS inbox.	Pro: Audit defense and rate-protest support are usually included.
Con: You bear all penalty and interest risk for math errors.	Con: Monthly fees of $25–$100 per entity.
Con: You must self-track rate changes and wage-base updates.	Con: You still sign — provider liability is limited.
Con: Limited recourse if a TWC notice is missed.	Con: Switching providers mid-year can disrupt YTD wage records.

FAQs

Is filing Form C-3 mandatory if I had no employees this quarter?

Yes. A zero report is still required for every quarter your TWC account is open; failing to file triggers a $15 minimum penalty and may close your account.

Can I file Form C-3 without filing Form C-4?

No. C-3 reports summary tax; C-4 reports per-employee wage detail, and TWC requires both unless you e-file through UTS, which combines them.

Do I write my FEIN or my TWC account number in Item 1?

No — Item 1 is only the TWC nine-digit tax account number. The FEIN goes in Item 2; switching them sends your filing to suspense.

In Item 15, do I include bonuses and commissions?

Yes. All cash and non-cash compensation counts toward the $9,000 taxable wage base under §201.082, including bonuses, tips, and commissions.

Should I report wages by the date earned or the date paid?

No to earned date — Texas reports wages by the date paid, so a December-earned check paid in January belongs in Q1.

Do I count independent contractors in Items 11, 12, and 13?

No. Only “covered workers” — those receiving W-2 wages — are counted; 1099-NEC contractors are excluded.

Is the $9,000 wage base reset each quarter?

No. The wage base is annual per employee per employer; once a worker hits $9,000 YTD with you, additional wages are non-taxable for the rest of the year.

Can I file Form C-3 late if I include the penalty?

Yes, but you still owe interest at 1.5% per month plus the penalty under §213.022; late filing also jeopardizes your FUTA 5.4% credit.

Does the TWC accept credit card payments for C-3 tax?

Yes, through the UTS portal via a third-party processor charging about 2.25%; ACH debit and TEXNET are free.

Is the C-3 filing deadline extended if it falls on a weekend?

Yes. Under §213.021, the deadline rolls to the next business day if the due date is a weekend or state holiday.

Should I check Item 5 “Final Report” if I have no employees this quarter but might rehire?

No. Check Final only if you have permanently closed; otherwise file a zero report and keep the account open.

Can a CPA sign the C-3 on my behalf?

Yes, if a Form C-42 Power of Attorney is on file with TWC; otherwise the owner or officer must sign personally.

Related reading