Texas paycheck guide
Why Texas paychecks carry no state income tax
Texas does not levy a personal income tax, and a constitutional amendment approved by voters in 2019 prohibits one. Creating a wage tax would take a new amendment and another statewide vote. Houston, Dallas, San Antonio, Austin, and Fort Worth do not tax wages either, so a Texas pay stub has no state or city income tax line at all.
There is also no state withholding certificate to fill out, no state return to file for wage income, and no state disability or paid family leave deduction. Texas unemployment insurance exists, but employers pay it to the Texas Workforce Commission; none of it comes out of your check.
The state still has to raise money. Texas leans heavily on sales tax at the state level, while school districts, counties, and cities fund themselves largely through property taxes. Those bills never touch payroll, which is why a Texas paycheck looks better than the household budget it has to cover.
Worked example: a $75,000 salary in Texas
Start with $75,000 of wages and subtract the $16,100 federal standard deduction, which leaves $58,900 of taxable income. The first $12,400 is taxed at 10% ($1,240), the next $38,000 at 12% ($4,560), and the final $8,500 at 22% ($1,870), for $7,670 of federal income tax.
FICA comes next: $4,650 for Social Security at 6.2% and $1,088 for Medicare at 1.45%. Texas adds nothing, so a single filer keeps $61,592, which is $5,133 a month or $2,369 on each of 26 biweekly paychecks. The Texas $75,000 salary breakdown shows weekly and semimonthly amounts.
With no state bracket in the way, your marginal cost on a raise is just the federal bracket plus FICA: at this salary, 22% plus 7.65%. A married couple earning the same $75,000 and filing jointly keeps $64,622, because the $32,200 joint standard deduction keeps all of their taxable income in the 10% and 12% brackets.
Withholding in Texas: the federal W-4 is the only form
Texas employers withhold federal income tax and FICA and nothing else, so Form W-4 is the only certificate that controls your take-home. Revisit it after a marriage, a second job, or a big raise. Two-earner households often need the Step 2 checkbox or an extra amount in Step 4(c) to avoid a balance due in April.
A bonus in Texas is usually withheld at the 22% federal supplemental rate plus FICA, with no state percentage stacked on top. The bonus tax calculator shows what a lump sum nets after that withholding.
Work done outside Texas is a different matter. If you commute from Orange into Louisiana or from Denison into Oklahoma, the state where you do the work taxes those wages, and you file a nonresident return there. Texas has no reciprocity agreements because it has no income tax to trade.
How Texas compares with its neighbors
Texas ties with the other no-income-tax states for first place in our ranking at both $75,000 and $150,000. Every bordering state taxes wages. At $75,000, Louisiana's flat 3% takes $1,864, Arkansas, with a 3.7% top rate, takes $2,287, New Mexico's six brackets take $2,359, and Oklahoma's top bracket of 4.5% helps push its bill to $2,830.
In take-home terms, a single filer on $75,000 keeps $61,592 in Dallas and $58,762 in Oklahoma City. See Oklahoma vs Texas or New Mexico vs Texas for any salary. The gap with high-tax states farther away grows with income; California vs Texas shows how quickly.
Where Texas collects instead: property and sales tax
Texas property taxes are among the higher ones in the country, and homeowners pay them through mortgage escrow or a yearly bill from the county tax office. Renters pay them too, built into rent. A residence homestead exemption lowers the taxable value of a home you own and live in; you apply for it through your county appraisal district.
Sales tax combines the state rate with city, county, and transit levies, so the rate at the register depends on where you shop. If you itemize on your federal return, you can deduct state and local sales tax in place of income tax, along with property tax, up to the federal cap. Most single filers at $75,000 still come out ahead with the $16,100 standard deduction.
What to expect at your income
Earning under $50,000
Under $50,000, a Texas paycheck is federal tax and FICA and nothing more. A single filer earning $30,000 takes home $26,285, or $1,011 every two weeks, and at $50,000 keeps $42,355, about $3,530 a month. A full-time job paying $31,200 a year nets $27,249, or about $13.10 for each hour on the clock. Texas has no state earned income credit, so the federal earned income tax credit is the main break to check at this income.
Earning $50,000 to $150,000
Between $50,000 and $150,000, only the federal brackets move your Texas take-home. A single filer at $100,000 keeps $79,180, or $6,598 a month, and at $150,000 keeps $113,791 after $24,734 of federal tax. A traditional 401(k) contribution saves federal tax alone here, at 22% or 24% in this range. If you expect to retire in a state that taxes income, a Roth 401(k) deserves a look, since Texas offers no state deduction for pre-tax saving now.
Earning over $150,000
Above $150,000 Texas still takes nothing, so the steps up come from the 24% and 32% federal brackets and the 0.9% Additional Medicare Tax on wages over $200,000. At $250,000 a single filer keeps $183,182. Social Security stops at $11,439 because wages above the $184,500 wage base are not taxed, so paychecks grow late in the year once you pass the cap. Plan bonus timing and 401(k) catch-up contributions around the 32% bracket, which starts above $201,775 of taxable income.
Texas paycheck tips
Make the federal W-4 do all the work
Texas has no state certificate, so the W-4 is your only withholding lever. If you hold two jobs or both spouses work, complete Step 2 or use the IRS estimator so the 22% and higher brackets are withheld correctly.
File for the homestead exemption
After you buy the home you live in, apply with your county appraisal district for the residence homestead exemption. It lowers the property tax bill, which is where Texas collects much of what other states take through payroll.
Report tip and overtime deductions on Step 4(b)
Texas restaurant, hospitality, and hourly workers who expect the new federal deductions for qualified tips or overtime can enter an estimate on W-4 Step 4(b). That lowers federal withholding during the year instead of waiting for a refund.
Save receipts for a car or boat purchase
If you itemize and deduct sales tax on your federal return, the IRS lets you add the sales tax paid on a vehicle or boat to the table amount. In Texas, with no income tax to deduct, that can tip the choice toward itemizing.
Log days worked in Louisiana, Oklahoma, or New Mexico
Field and energy jobs often send Texans across the border for weeks at a time. Those states tax wages earned there, and a simple day log makes the nonresident return and any employer withholding easier to get right.
Common mistakes
Forgetting the final return in your old state
Moving to Texas midyear does not erase the state you left. Wages earned there before the move go on a part-year resident return, and some states watch closely for people who claim a Texas move but keep a home behind.
Comparing offers on paycheck alone
A $75,000 Texas salary keeps more than the same pay in any neighboring state, but property tax, homeowners insurance, and housing costs vary widely between Austin, Houston, and smaller cities. Run the relocation calculator before counting the paycheck gap as savings.
Ignoring an out-of-state employer's withholding
If your employer is based elsewhere and your assigned office is in a state such as New York, that state may treat remote days as taxable and withhold from your pay. Check each pay stub for a state line you did not expect.
Moving to or from Texas
Moving to Texas
Moving to Texas ends state income tax withholding with your first Texas paycheck. For a single filer earning $75,000, that is $1,864 more a year than in Louisiana and $2,830 more than in Oklahoma. File a part-year return in the state you left for wages earned before the move. Then budget for what Texas charges instead: property taxes, which a homestead exemption trims, and combined state and local sales tax.
Leaving Texas
Leaving Texas adds a state tax line to every paycheck. At $75,000, a single filer keeps $61,592 in Texas but $59,728 in Louisiana, $59,233 in New Mexico, and $58,762 in Oklahoma. Most states with an income tax have their own withholding certificate, so fill it out on your first day. Expect a part-year resident return in the new state for the year you arrive.