H.B. 4765 brings some relief to all small business owners. On May 31, 2009, H.B. 4765 amended Section 171.002 of the Tax Code to increase the small business exemption from the Texas franchise tax to $1 million from the low $300,000 for both tax years of 2010 and 2011. After the increase in the exemption, the margin rate will reduce to $600,000 after 2011. This Bill takes effect in January of 2010.