Texas Income Tax Calculator 2026
Texas has NO state income tax. Calculate your tax savings compared to high-tax states.
Income Information
Why Texas Has No Income Tax
Texas is one of nine states with no state income tax. The state funds government services primarily through sales tax, property tax, and business franchise taxes.
States with No Income Tax (2026)
- Alaska
- Florida
- Nevada
- New Hampshire (wages only; dividends/interest taxed)
- South Dakota
- Tennessee
- Texas
- Washington
- Wyoming
Tax Advantages of Living in Texas
- No state income tax: Keep 100% of your income (after federal taxes)
- No corporate income tax: Business-friendly environment
- No franchise tax for small businesses: Under $1.23M revenue exempt
- Competitive cost of living: Lower than many high-tax states
Other Texas Taxes to Consider
- Sales tax: 6.25% state + up to 2% local = 8.25% combined max
- Property tax: Average 1.60% (varies by county)
- Federal income tax: Still applies (same nationwide)
Moving to Texas? Key Considerations
While Texas offers significant income tax savings, consider these factors:
- Property taxes are higher than many states (average 1.60% of home value)
- Sales tax on most purchases (8.25% combined rate)
- No state income tax deduction on federal returns
- Housing costs vary widely (Austin/Dallas expensive, rural areas affordable)
Who Benefits Most from Texas' No Income Tax?
- High earners ($150K+): Save $5K-$15K+ annually vs. California
- Retirees: Social Security and retirement income not taxed by state
- Business owners: No corporate income tax, lower franchise tax
- Remote workers: Keep California salary without California taxes