The New Texas Law That Could Bankrupt Your Small Business With One Text Message

The New Texas Law That Could Bankrupt Your Small Business With One Text Message

November 23, 20254 min read

And why SMS might be the worst marketing channel to gamble on right now.

Small businesses love texting customers because it feels personal and direct. Get their name, email, phone number, send a quick reminder or offer — easy. But with the new Texas SB 140 update, one innocent message can turn into a five-figure mistake you never saw coming.

And the worst part?
You can violate the law accidentally, even if you had no idea where the person lived.

Let’s start right where the danger is loudest.


🔥 Texas SB 140: The Law That Can Nail You Even If You Didn’t Mean To Break It

Texas expanded its telephone-solicitation law to include text messaging.
Your marketing SMS is now treated exactly like a telemarketing call.

That means strict rules, required registration, and lawsuits on the table — even for tiny local businesses.

Here’s how easily it can happen:

Accidental violation scenario

  • Someone fills out your form.

  • You collect name, email, phone number.

  • You send a simple promo text.

  • They happen to be a Texas resident.

  • Their area code is from another state.

  • You had no clue.

  • You’re now in violation of Texas law.

That’s how fast this goes wrong.

CRMs don’t verify where someone lives.
Phone numbers don’t reveal residency anymore.
Intent doesn’t matter — compliance does.


📜 Full Outline of Texas SB 140 (In Plain English)

Texas now treats marketing texts as formal telemarketing. Here’s what that means for businesses:


1. Marketing SMS = Telemarketing

Any message that promotes, sells, or encourages a booking is telemarketing under Texas law.

Appointment reminders or receipts are safe only if they contain zero promotions.


2. You need express written consent

This must be:

  • Separate

  • Clear

  • Voluntary

  • Documented

  • Not bundled into a purchase or hidden in terms

Just having their phone number is NOT consent.


3. Telemarketer registration may be required

If you send marketing texts to Texas residents, you may need to:

  • Register with the Texas Secretary of State

  • Pay the fee

  • Post a $10,000 bond

  • Renew when required

  • Keep documentation

Most small businesses don’t know this step exists.


4. Restricted texting hours

Marketing texts can only be sent:

  • Mon–Sat: 9am–9pm

  • Sunday: Noon–9pm

One automated text outside that window = violation.


5. You must identify your business in every message

If your identity isn’t clear, it’s illegal.

No vague promos. No mystery texts.


6. You must honor opt-outs immediately

“STOP” must stop all marketing instantly.

You need suppression lists to guarantee it.


7. Texas customers can sue you directly

This is the part that hits hardest.

SB 140 opens the door to private lawsuits under the Texas Deceptive Trade Practices Act.

Penalty: up to $5,000 per violation + attorney fees.

One wrong message can wipe out a month of revenue.


8. You need airtight records

You must keep:

  • Proof of consent

  • Exact message logs

  • Opt-out logs

  • Registration proof

  • Time/date of every message

  • Copies of the consent language they agreed to

If you can’t prove compliance, you lose by default.


🌎 Other States Are Already Doing This Too

Texas isn’t alone — it’s just one of the most aggressive.

Arizona

HB 2312 bans unsolicited text ads entirely.
No consent = illegal. No wiggle room.

Florida

Their Mini-TCPA is notorious for lawsuits targeting small businesses.

California, Colorado, Connecticut, New Jersey

They all enforce extra rules around:

  • Consent

  • Message timing

  • Do-Not-Call lists

  • Marketing vs transactional wording

More states are drafting copycat bills

Legislators love “consumer protection” wins.
These laws are multiplying, not going away.


⚠️ The Real Risk: You Don’t Know Where Someone Lives

This is why SMS is so dangerous now.

  • People move between states

  • Many keep old area codes

  • CRMs don’t track residency

  • The law treats “I didn’t know” as irrelevant

A simple form that collects name, email, phone?
That’s not enough anymore.

The days of “just text them” are over.


Should Small Businesses Even Do SMS Marketing Now?

Unless you have:

  • Verified state of residence

  • Clear written consent

  • Time-zone control

  • Suppression lists

  • Compliance tracking

  • Stored legal documentation

  • Telemarketer registration where required

…SMS marketing is a legal gamble.

A single message can cost you more than a full year of profit.

For many small businesses, SMS isn’t worth the risk.


✔️ There Are Safer, Smarter Ways to Follow Up

You can still get great results without inviting legal trouble:

  • Email

  • Voicemail drops

  • Retargeting ads

  • Fast lead follow-up

  • Appointment nurture sequences

  • Google Business Profile optimization

  • On-site conversion systems

All of these can outperform SMS without the legal dynamite strapped to them.

Want a safer way to grow without stepping on legal landmines? Book a quick call and I’ll walk you through what actually works.

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