Estimate your take-home pay in Texas. Texas does not levy a state income tax, so your paycheck is only subject to federal income tax, Social Security, and Medicare withholdings. This can result in significantly higher take-home pay compared to states with income taxes.
Disclaimer: All figures on this page are estimates for general informational purposes only and are not financial, tax, or legal advice. Tax rates, brackets, and withholding rules change and vary by locality and personal circumstances. Verify current rates with the Texas Department of Revenue or the IRS, and consult a qualified tax professional before making financial decisions.
Where Texas Stands: One of 9 States With No Income Tax
Texas is one of only 9 states that collect no tax on wage income, alongside Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Washington, and Wyoming. Everywhere else, state income tax takes a bite out of each paycheck — the median top rate across the 42 states and jurisdictions that do tax wages is 5.25%.
Skipping the income tax does not make Texas tax-free. Its combined average sales tax is 8.2%, above the national median of 7%, and its average property tax rate of 1.68% is above the median of 0.87%.
For comparison, nearby states line up like this: Arkansas (top rate 3.9%); Louisiana (top rate 3%); New Mexico (top rate 5.9%); Oklahoma (top rate 4.5%).
Texas Tax Snapshot
- State Income Tax
- None
- Sales Tax (state + local avg)
- 8.20%
- Avg Property Tax Rate
- 1.68%
- Median Home Value
- $301,600
- State Minimum Wage
- $7.25/hr
Did You Know?
Texas prohibits a state income tax but has some of the highest property tax rates.
What Comes Out of a Texas Paycheck
Since Texas has no state income tax, your paycheck deductions are limited to federal income tax, Social Security (6.2%), and Medicare (1.45%). This tax advantage means workers in Texas typically take home more of their gross pay. The state minimum wage is $7.25 per hour, and the average property tax rate is 1.68% on homes valued around $301,600.
Texas also levies a combined state and average local sales tax of 8.20%, which affects your overall purchasing power. Factor this into your budget when calculating how far your paycheck stretches.
Where You Live vs. Where You Work in Texas
Because Texas does not tax wage income, there is nothing for it to reciprocate. If you live in Texas but work in a state that does tax wages, that state normally taxes the income you earn there — and Texas offers no credit to offset it, because it collects nothing to credit against.