NOT LEGAL OR FINANCIAL ADVICE
This content is for educational purposes only. Laws change frequently and vary by circumstance. Always consult a licensed attorney in your state before taking any legal action. We are not responsible for any decisions or actions taken based on this information.
Texas Freelance Invoice Laws
General information about collecting unpaid invoices in Texas
Last Updated: 2025-01-01 • Always verify with a Texas attorney
Late Fee Limit
No statutory limit for B2B contracts
Interest Rate
6% per annum (default); 18% maximum by agreement
Small Claims Limit
$20,000
Statute of Limitations
4 years for written contracts, 4 years for oral
Additional Context
Late Fees: Late fees must be reasonable and agreed upon in writing. Courts may find excessive fees unenforceable.
Interest: Parties can agree to up to 18% in writing. Above 18% may be considered usurious.
Small Claims: Justice of the Peace courts handle small claims. No attorneys required but permitted.
General Best Practices
These are general suggestions, not legal advice. Consult an attorney for your specific situation.
- ✓ Use written contracts specifying payment terms for all projects
- ✓ Include specific late fee percentages in your contract (1-2% monthly is standard)
- ✓ Send invoices immediately upon project completion with clear due dates
- ✓ Document all scope changes and approvals in writing
- ✓ Follow up on overdue invoices at 7, 14, and 30 days
Common Mistakes to Avoid
- ✗ Starting work without a signed contract
- ✗ Not specifying payment terms upfront
- ✗ Waiting too long to pursue collection (4-year limit)
- ✗ Setting late fees above 18% annual rate
- ✗ Not keeping records of client communications
When to Consult an Attorney
For invoices over $10,000 or if the client disputes the quality of work delivered.
Frequently Asked Questions
What is the maximum late fee I can charge in Texas?
Texas has no statutory cap on late fees for B2B contracts, but they must be reasonable and specified in your contract. Courts can reduce excessive fees. Most freelancers use 1.5-2% per month.
How long do I have to sue for an unpaid invoice in Texas?
You have 4 years from the invoice due date to file a lawsuit for both written and oral contracts in Texas. Act promptly for better chances of collecting.
What is the small claims limit in Texas?
Texas small claims courts (Justice of the Peace) handle claims up to $20,000. Filing fees range from $50-$100. You can represent yourself, making it ideal for freelancer disputes.
What interest rate can I charge on overdue invoices in Texas?
The default legal rate is 6% per annum. You can contractually agree to up to 18% annually. Rates above 18% may be considered usury and unenforceable.
Do I need a collection license in Texas?
No, you can collect your own debts without a license. Third-party collection agencies must be licensed with the Texas Secretary of State.
Sources & References
These are reference sources only. Laws change—verify current statutes before taking action.
- Texas Finance Code Chapter 302 (Usury)
- Texas Government Code Chapter 28 (Justice Courts)
- Texas Business & Commerce Code
- Texas Secretary of State - Debt Collection
IMPORTANT LEGAL DISCLAIMER
This is NOT legal or financial advice. The information on this page is provided for general educational and informational purposes only. It is not intended to be, and should not be construed as, legal, financial, or professional advice.
Laws change frequently. State laws, court rules, and regulations are subject to change without notice. The information presented here may not reflect the most current legal developments or may not apply to your specific situation.
Consult a licensed professional. Before taking any action based on the information on this website, you should consult with a licensed attorney in Texas who can provide advice tailored to your specific circumstances.
No attorney-client relationship. Viewing this information does not create an attorney-client relationship between you and Happy Freelance Life or its creators.
No liability. Happy Freelance Life and its creators disclaim all liability for any actions taken or not taken based on any information on this website. You assume full responsibility for any decisions or actions you take based on this content.
If you need legal help, please contact the Texas State Bar Association for attorney referrals or a legal aid organization in your area.
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Take the QuizThis information is for educational purposes only and does not constitute legal advice. Consult a licensed Texas attorney for specific legal guidance. This page was last updated on 2025-01-01. For current legal information, consult the official Texas state statutes or a licensed Texas attorney. Happy Freelance Life is not a law firm and does not provide legal services.