Texas Paycheck Calculator & Income Tax Rates (2026)

Texas does not levy a personal income tax, so there are no brackets, no standard deduction and no state withholding from your paycheck. Federal income tax, Social Security (6.2% up to $184,500) and Medicare (1.45%, plus 0.9% above $200,000) are the only payroll taxes you pay.

With no state tax, the effective rate in Texas rises only because federal brackets are progressive and the 0.9% additional Medicare tax kicks in above $200,000.

Filing status only changes the federal side in Texas. A married couple filing jointly on $100,000 keeps $84,710 versus $79,125 for a single filer — the difference comes entirely from the doubled federal standard deduction ($32,200 vs $16,100) and wider federal brackets.

Texas has no personal income tax, and since 2019 the state constitution flatly forbids one: Proposition 4 replaced an older rule that merely required voter approval with an outright ban on taxing an individual's income, including income from a partnership or other unincorporated business. No Texas wage, salary, capital gain, dividend or retirement dollar is taxed at the state or local level for 2026, and no local government can create such a tax. The state funds itself through a 6.25% sales tax, oil and gas severance taxes, and a franchise tax on businesses, while school districts, cities and counties lean on property taxes that rank among the highest in the country. That trade-off is the whole story of Texas taxation: a high-income household saves five figures against California or New York, but a homeowner in a Dallas or Austin suburb can pay 2% of market value every year. Voters approved another increase in the school homestead exemption in November 2025, the second in two years.

With no income tax there is no state return, standard deduction, personal exemption, earned income credit or child credit; the federal standard deduction and credits apply on their own, and Texans who itemize can deduct sales tax paid on federal Schedule A. Businesses file the franchise or "margin" tax instead, though entities with roughly $2.5 million or less in annual revenue owe nothing, and sole proprietors and general partnerships made up of individuals are exempt entirely.

No Texas city, county or school district levies an income or wage tax, and the 2019 constitutional amendment removes any authority to create one. Local budgets rest on property taxes and the 2% local share of the sales tax; Houston, Dallas and San Antonio all collect the maximum 8.25% combined rate.

The state sales tax is 6.25%, and local governments — cities, counties, transit authorities and special districts — can stack up to 2% more, so the combined rate is 8.25% in Houston, Dallas, San Antonio, Austin and virtually every other city of size. Groceries, prescription and over-the-counter drugs are exempt. The August back-to-school holiday waives tax on clothing and school supplies under $100 an item. Motor vehicles pay a separate 6.25% tax with no local add-on.

Texas has no state property tax, but local rates are among the highest anywhere: the effective rate averages about 1.6% of market value after the 2023 cuts and often exceeds 2% in suburban school districts. The school homestead exemption, raised from $40,000 to $100,000 in 2023, rose again to $140,000 under a November 2025 amendment, with a further $60,000 for homeowners 65 or older or disabled, who also get a ceiling on their school taxes. Homestead appraisals can rise no more than 10% a year.

No retirement income of any kind is taxed: Social Security, private and public pensions, military retirement, 401(k) and IRA withdrawals, annuities and investment income are all untouched, and Texas has no estate or inheritance tax. What retirees get instead is the property tax code's best deal: at 65 the school district portion of the homestead bill freezes, the extra $60,000 senior exemption applies on top of the $140,000 standard homestead exemption, and taxes can be deferred outright until the home is sold. The one caveat is homeowners' insurance, which along the Gulf Coast can cost more than a modest state income tax would.

High W-2 earners and business owners are the clearest winners: a $500,000 household relocating from California saves close to $40,000 a year in state income tax, and a founder selling a company owes Texas nothing on the gain. Retirees pay no tax on any income source and get frozen school taxes at 65. Renters in Houston or San Antonio, where rents are moderate, come out ahead too. The losers are middle-income homeowners in high-value suburbs — a $450,000 house in Collin or Travis County can generate a property tax bill larger than what the same family would owe in income tax in Georgia or North Carolina. Remote workers keep wages tax-free unless the employer's state applies a convenience-of-the-employer rule.

The median household income in Texas is $62,000, which is $51,997 a year ($4,333 a month) after all taxes. That is close to the national median. After adjusting for cost of living, the purchasing power of that take-home is equivalent to $55,911 in an average-cost area.

Texas ranks #7 of 50 for raw take-home pay and #11 for cost-adjusted purchasing power at $100,000. The 4-place gap between the two reflects a below-average cost of living that boosts real purchasing power. The best state (Alaska) leaves $79,125; the worst (Oregon) leaves $70,932. Texas is $0 behind the leader.

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