Texas state taxes at a glance
| Individual income tax | No broad individual income tax on wages |
|---|---|
| Rate structure | No individual income tax on wages or other personal income. The state constitution requires voter approval for a personal income tax. |
| Tax agency | Texas Comptroller of Public Accounts |
| Main individual return | None for individuals (federal return only). Businesses may owe a franchise tax report. |
| Local income taxes | No local income taxes. |
| Sales tax | A state rate plus local rates that can bring the combined rate to a statutory maximum. Collected by the Comptroller. |
| Property tax | No state property tax; school districts, counties, cities and special districts set local rates and appraisal districts value property. Homestead exemptions exist; amounts have changed in recent years. |
| Retirement & Social Security | No state income tax, so retirement income and Social Security are not taxed by Texas. |
Verify current-year figures: state rates, brackets, credits and filing rules change. Treat this page as a starting orientation and confirm details on the Texas Comptroller of Public Accounts website.
How Texas income tax works
Texas does not tax individual income, and the Texas Constitution requires voter approval before a personal income tax could be adopted. For a typical employee that means your paycheck shows federal income tax, Social Security and Medicare, but no Texas income tax line. You will still file a federal Form 1040 (see our complete filing guide).
The state raises revenue mainly from sales taxes and from local property taxes, which are among the more significant costs of living in Texas for homeowners. Businesses are subject to the Texas franchise tax (often called the margins tax), which applies to many entities, including LLCs and corporations, based on revenue and margin calculations; entities below a revenue threshold generally owe no tax but may still need to file a report. Because thresholds and rules change, consult the Comptroller’s franchise tax pages rather than relying on a number from any third-party site.
If you are self-employed as a sole proprietor, you generally do not owe Texas franchise tax, but you still owe federal income tax and self-employment tax.
Filing your Texas return and free options
With no state individual income tax return, your free-filing question is purely federal: see free tax filing options. When comparing software, you can often skip any paid “state” add-on for Texas. If you moved to or from Texas during the year, you may still owe a return to your other state for income earned while living there.
For property taxes, the main action items are your county appraisal district’s notice of appraised value (you can protest it within the published deadline) and applying for a homestead exemption, which the appraisal district administers. Sales tax matters if you sell goods or taxable services; sellers apply for a permit with the Comptroller.
For the federal side, see our guides to free federal filing options and the complete guide to filing taxes.
Things Texas residents often ask about
- No Texas state refund status: there is no individual state return, so “Texas tax refund” searches usually refer to your federal refund — use the IRS refund tool.
- Remote workers living in Texas but working for an employer in another state may still have that state’s tax withheld in some cases; check where the work is physically performed.
- Homestead exemption applications go to the county appraisal district, not the state.
- Small business owners should check franchise tax filing requirements and annual report deadlines with the Comptroller.
Official Texas links
- Texas Comptroller: taxes
- Texas Comptroller: franchise tax
- Texas Comptroller: sales tax
- Federation of Tax Administrators: State tax agencies
Frequently asked questions
Does Texas have a state income tax?
No. Texas does not tax individual income, and its constitution requires voter approval for a personal income tax.
Do I still need to file taxes in Texas?
You file a federal return if you meet the federal filing requirements. There is no Texas individual income tax return. Businesses may have franchise tax reporting duties.
Why are Texas property taxes high if there is no income tax?
Local governments rely heavily on property taxes. Rates and exemptions differ by taxing unit, so check your county appraisal district and tax assessor.
General information only — not tax, legal or financial advice. Tax figures change every year; verify the current numbers at IRS.gov or with a qualified professional. Read the full disclaimer.