2023/24 Texas Income Tax Calculator

To use the Texas income tax calculator, simply input your desired salary and filing status to begin.

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💡What Is the Average Salary in Texas?

In Texas, the average salary as of December 2023 is approximately $52,393 per year, equating to about $25.19 an hour. However, this figure can vary widely, with entry-level positions starting at $32,143 per year, and the most experienced workers earning up to $119,933 per year. These variations reflect the diverse range of industries and job roles within the state.

The average salary in Texas by city also differs significantly, with cities like Flower Mound, Frisco, and The Woodlands offering average earnings well above the state average.

💡What Is the Minimum Wage in Texas?

The minimum wage in Texas is aligned with the federal minimum wage, which is $7.25 per hour as of 2023. This rate is applicable across the state, irrespective of the city or county.

While this is the minimum set by law, actual wages can vary based on the industry, employer, and region within Texas.

Texas is known for its tax advantages, chiefly its lack of state income tax. However, a thorough assessment must also consider property and sales taxes. This analysis delivers a comprehensive review of Texas’ tax landscape.

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State Income Tax

Absence of State Income Tax

• Unique Selling Proposition: Texas is among the seven U.S. states that do not levy a state income tax.
• Impact on Business: While appealing for entrepreneurs, wealthy individuals, and corporations, some argue that the absence of income tax merely redistributes the tax burden onto other avenues.

Property Taxes

Rate Variability

• Average Rates: The state’s average property tax rate stands at around 1.69%, which is well above the national average of 1.08%.
• County Differences: This rate can vary considerably depending on the county, ranging from about 1.5% to upwards of 2%.

Homestead Exemption

• Impact: A $15,000 homestead exemption on a $300,000 home in a district with a 1.54% school tax rate would yield annual tax savings of around $231.

Sales Tax

State and Local Variations

• Base Rate: Texas imposes a base state sales tax of 6.25%.
• Local Taxes: Cities, counties, and transit authorities can add up to an additional 2%, potentially raising the overall sales tax rate to 8.25%.

Exceptions

• Groceries and Medicine: Essential items like food and prescription drugs are generally exempt from sales tax.

Previous Texas Income Taxes

Federal Income Tax: A Constant

Just like every other state in the U.S., Texas residents are obligated to pay federal income taxes. There’s no escape from this federal imposition, irrespective of the state’s own income tax policies.

Changing Federal Tax Brackets

Federal income tax brackets have undergone numerous changes over time, influenced by various administrations and Congressional actions. These changes are often enacted to account for economic factors such as inflation.

2012 and 2002 Texas Income Tax Calculator

Related

• California Historical Cost of Living Report
• California Income Tax Calculator
• Florida Income Tax Calculator
• Florida Historical Cost of Living Report
• Texas Historical Cost of Living Report

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