State income tax (top rate)
None
Property tax (avg effective)
1.49%
PTET workaround
Not available
Texas tax notes
- No state income tax. Higher property tax and high sales tax (8.2% combined avg) compensate.
- Annual Texas Franchise Tax on businesses with > $2.65M in revenue (2026).
- Homestead exemption + Sec. 25.18 caps annual assessment increases on primary residences.
Sample tax numbers for Texas
Quick orientation — use the full calculator for your actual situation.
State income tax on $100,000 taxable$0
Property tax on $400,000 home (avg)$5,960
SALT deduction usable (capped at $40,400)$5,960
Tax moves that matter most for Texas
No state income tax — focus on federal levers
Texas has no state income tax, so SALT cap concerns are limited to property tax. Optimization focus shifts to federal: 401(k), Mega Backdoor Roth, HSA, S-Corp election for self-employed.
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S-Corp election for self-employed
At net SE income above ~$80k-$100k, electing S-Corp typically saves $5k-$15k/yr in self-employment tax — the math is federal.
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Solo 401(k) for self-employed retirement
If you have 1099 income, Solo 401(k) lets you contribute up to $72,000/yr (2026) — far more than SEP-IRA in most cases. Reduces your federal income tax.
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Run your Texas numbers
Open the full optimizer with Texas pre-selected to see your specific tax picture.
Open the full calculatorMore Texas tools & comparisons
Texas S-corp / self-employment tax calculatorCompare with other states: