1. Texas State Tax Overview

Texas is one of nine U.S. states that does not levy a state income tax on individuals. The state generates revenue through other means like sales taxes, property taxes, and various fees.

2. How This Calculator Works

The calculator confirms that Texas has no state income tax, regardless of income level. Your state income tax obligation will always be $0.

3. Understanding Texas Tax Structure

Details: While Texas doesn't have an income tax, it has one of the highest combined state and local sales tax rates in the U.S. (average 8.20%). Property taxes are also relatively high compared to other states.

4. Other Taxes in Texas

Important Notes: Texas residents still pay:

• Federal income tax
• Sales tax (6.25% state rate + local additions)
• Property taxes (among highest in nation)
• Special district taxes
• Excise taxes on specific goods

5. Frequently Asked Questions (FAQ)

Q1: Do I need to file a state income tax return in Texas?
A: No, Texas does not require state income tax returns since there is no state income tax.

Q2: Are there any exceptions to the no income tax rule?
A: Texas does tax corporate income (franchise tax) and has a limited tax on certain partnerships.

Q3: How does Texas compare to other no-income-tax states?
A: Texas makes up for no income tax with higher property and sales taxes. The overall tax burden is about average nationally.

Q4: Do I still pay federal taxes in Texas?
A: Yes, all U.S. residents must pay federal income taxes regardless of which state they live in.

Q5: Are retirement accounts taxed in Texas?
A: No state taxes on retirement account withdrawals, though federal taxes still apply.