What Texas does and doesn't tax
Texas does not tax wages, salaries, tips, interest, dividends, pensions or Social Security, and it has no state income tax withholding. Texas voters added an outright ban on a personal income tax to the state constitution in 2019.
Federal income tax still applies in full — the 2026 federal brackets run from 10% to 37% — and Social Security (6.2%) and Medicare (1.45%) come out of every paycheck. If you earn wages in a state that taxes income, for example by commuting across a border, that state can tax the wages earned there.
Income tax you avoid at common incomes
What a single filer would owe Oklahoma, the nearby state with the highest tax at $75,000, compared with $0 in Texas:
| Income | Texas | Oklahoma |
|---|---|---|
| $30,000 | $0 | $805 |
| $50,000 | $0 | $1,705 |
| $75,000 | $0 | $2,830 |
| $100,000 | $0 | $3,955 |
| $150,000 | $0 | $6,205 |
| $250,000 | $0 | $10,705 |
Texas compared with nearby states
At $75,000 (single), Texas ranks 43 (tied with 8 others) of 51 for state income tax, where 1 is the highest; 9 jurisdictions charge nothing at this income.
| State | Tax on $75,000 | Effective rate | Top rate |
|---|---|---|---|
| Texas | $0 | 0% | none |
| New Mexico | $2,359 | 3.15% | 5.9% |
| Oklahoma | $2,830 | 3.77% | 4.5% |
| Arkansas | $2,287 | 3.05% | 3.7% |
| Louisiana | $1,864 | 2.48% | 3% |
More about taxes in Texas
- Texas businesses pay a franchise (margin) tax instead — 0.75% for most, 0.375% for retailers and wholesalers — with no tax due below $2.65 million of revenue on 2026 reports.
Frequently asked questions
Does Texas have a state income tax?
No. Texas voters added an outright ban on a personal income tax to the state constitution in 2019. Wages, salaries, interest, dividends and retirement income are not taxed by the state.
How much does living in Texas save on income tax?
On $75,000 of income, a single filer pays $0 to Texas; 9 of 51 jurisdictions charge nothing at that income. Nearby, Oklahoma would charge about $2,830.
Do I still pay federal income tax in Texas?
Yes. Federal income tax, Social Security and Medicare apply in every state. Texas residents who earn wages in a state that does tax income can also owe that state tax on those wages.
What other taxes do Texas residents pay?
Texas businesses pay a franchise (margin) tax instead — 0.75% for most, 0.375% for retailers and wholesalers — with no tax due below $2.65 million of revenue on 2026 reports.
Estimates only — not tax advice. Texas figures: Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 (as of Jan. 1, 2026). Checked October 2026. Your return may include income, deductions and credits this estimate leaves out.