Texas Income Tax Calculator - SmartAsset (2024)

Taxes in Texas

Texas State Tax Quick Facts

• Income tax: None
• Sales tax: 6.25% (local tax: 0% - 2%)
• Property tax: 1.74% average effective rate
• Gas tax: 20 cents per gallon of regular gasoline and diesel

The Lone Star State is one of only a few states that collect no income taxes of any kind. For that reason, it often ranks high on lists of the most tax-friendly states, but its sales and property taxes aren’t quite as kind to the average taxpayer’s wallet. In fact, the maximum sales tax rate in a county is 8.25%. The 1.74% average effective property tax rate in Texas is higher than all but five states.

A financial advisor can help you understand how taxes fit into your overall financial goals. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you canhave a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Texas Income Taxes

Don’t mess with Texas. And once you’re there, you won't have to mess with a state income tax return, either. It is one of a handful states that do not levy taxes on income of any kind. Of course, you’ll still need to pay federal income taxes and file a federal income tax return.

Texas Sales Tax

While Texas’ statewide sales tax rate is a relatively modest 6.25%, total sales taxes (including county and city taxes) of up to 8.25% are levied. To make matters worse, rates in most major cities reach this limit. Dallas, Houston and San Antonio all have combined state and local sales tax rates of 8.25%, for example. Below are the rates for every county in Texas.

Texas also charges a number of additional fees and taxes on the sales of certain goods. Notable examples include its hotel occupancy tax, which is 6% of the cost of a hotel room, and a manufactured housing tax that equals 5% of a home's sale price.

Some services are also subject to sales tax in Texas. Among the types of services for which you might have to pay sales tax are entertainment like live music or movie tickets, television service (whether cable or satellite) and any kind of automobile parking or storage services. Texas did, however, stop charging sales taxes on internet access services as of July 1, 2020.

Texas Alcohol and Tobacco Taxes

Texas taxes liquor at $2.40 per gallon. The Lone Star State also taxes a pack of 20 cigarettes totals $1.41.

Texas Property Tax

Property taxes in Texas are among the highest in the country. Effective property tax rates average 1.74%, meaning Texan households pay an average of $3,520 in property taxes each year.

Property tax rates have become a contentious issue between local governments and the state. Some state representatives want to cap rates, while cities and counties oppose that measure. That’s because, in most areas, property taxes are the primary source of local revenue.

In Dallas County, for example, the average effective rate is 1.81%. In Harris County, where Houston is located, the average effective property tax rate is 1.91%. That means thousands of dollars a year in property taxes for the typical Texas homeowner.

But high property taxes don’t necessarily mean you should be a renter for life. If you are thinking about purchasing a home in Texas, take a look at our mortgage guide for rates and other information about getting a mortgage in Texas.

Texas Gasoline Tax

The Texas excise taxes on regular and diesel gasoline total 20 cents per gallon.

Texas Estate Tax

As of Jan. 1, 2005, there is no estate tax in Texas.

Other Notable Taxes in Texas

Texas has an oyster sales fee. Shellfish dealers in Texas are required to pay a tax of $1 per 300 pounds of oysters taken from Texas waters.

• Cameron County, Texas is located at 26.15° North, and contains the most southern point along the US-Mexico border.
• Four of the 10-most populous cities in the country are in Texas. These include Houston, San Antonio, Dallas and Austin.
• Texas is the largest oil producer in the U.S. In 2014, it produced more oil than any country in the world except Saudi Arabia.