No, Texas does not require you to file a state income tax return. The state has no personal income tax, so wages, investment gains, retirement distributions, and other personal income are never reported to a Texas tax agency. You still file a federal return with the IRS if your income meets the federal threshold, and if you own property or run a business in Texas, separate state and local filings may apply.
Why There Is No State Return to File
Texas is one of a handful of states with no tax on personal income. The protection sits in Article 8, Section 24 of the Texas Constitution. The provision does not outright ban an income tax; it says the legislature cannot impose one unless a majority of voters approve it in a statewide referendum, and the ballot must specify the rate. Any income tax that did pass would also have to fund school district property tax relief and give taxpayers a credit for school property taxes on their home.1State of Texas. Texas Constitution Article 8 – Taxation and Revenue
The practical result for residents: there is no state form, no state deadline, and no state withholding on your paycheck.
You Still Owe a Federal Return
No state income tax does not mean no income tax. Every Texas resident who earns above the federal filing threshold must file with the IRS, same as a resident of any other state. You just file one return instead of two.
Whether you need to file depends on your gross income, filing status, and age. For the 2026 tax year, the standard deduction is $16,100 for single filers, $32,200 for married couples filing jointly, and $24,150 for heads of household. If your gross income falls below your standard deduction, you generally do not have to file, though doing so anyway makes sense when you had taxes withheld and want a refund.2Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026
Self-employed Texans face a lower bar. If you earn $400 or more in net self-employment income, you must file a federal return regardless of your total income, because you owe self-employment tax on those earnings. This catches a lot of freelancers and gig workers who assume their income is too low to trigger a filing requirement.
Other situations force a return no matter your income: owing the alternative minimum tax, receiving advance premium tax credits through the Health Insurance Marketplace, or owing tax on a health savings account distribution. The IRS runs an interactive tool at irs.gov that walks through your situation.3Internal Revenue Service. Check if You Need to File a Tax Return
Property Taxes: What a Homeowner Actually Files
The tradeoff for having no income tax is a heavier property tax. The state’s average effective property tax rate is roughly 1.40%, among the highest in the country. School districts, cities, counties, and special districts each set their own rates, so the bill depends entirely on where the property sits.
Property taxes become delinquent on February 1 of the year following the tax year. Miss that date and a 6% penalty applies in the first month, with interest and additional penalties stacking on from there.4Texas Comptroller of Public Accounts. Penalty Tax Bills There is no annual “property tax return” the way an income tax return works; the appraisal district values your property, taxing units set rates, and you pay the bill. But two filings are worth knowing about.
Homestead Exemption
If you own and live in your home, a residence homestead exemption removes $100,000 of the home’s appraised value from school district taxes. Owners 65 or older or disabled qualify for an additional $10,000 school district exemption, and local taxing units may offer further optional exemptions.5State of Texas. Texas Tax Code TAX 11.13 – Residence Homestead You apply once with your county appraisal district, and the exemption carries forward as long as you keep living in the home.
Protesting Your Appraisal
If the appraised value looks too high, file a protest with your local appraisal review board. The deadline is May 15 or 30 days after the appraisal district mails your notice, whichever is later.6Texas Comptroller of Public Accounts. Appraisal Protests and Appeals Most county appraisal districts accept protests through their websites, and you can file one yourself without an attorney or tax consultant.
Use Tax on Untaxed Purchases
One state filing can reach individuals without any business at all. When you buy something from a seller who does not charge Texas sales tax, you owe use tax at the state rate of 6.25% plus any local rate. This commonly applies to online purchases from out-of-state retailers with no Texas tax obligation. Individuals without a sales tax permit file a separate Texas Use Tax Return. If you owe less than $1,000 in use tax for the year, the return is due January 20 of the following year. If you owe $1,000 or more, you must file by the 20th of the month after you cross that threshold.7Texas Comptroller of Public Accounts. Use Tax
If You Own a Business in Texas
Business owners file more. The absence of a personal income tax does not carry over to legal entities, and sales activity and payroll each trigger their own obligations.
Franchise Tax
The franchise tax applies to most legal entities, including corporations, LLCs, partnerships, banks, and trusts. Sole proprietorships and general partnerships owned entirely by individuals are exempt.8Texas Comptroller of Public Accounts. Taxable Entities – Franchise Tax Frequently Asked Questions The annual report is due May 15, shifting to the next business day if the date falls on a weekend or holiday.9Texas Comptroller of Public Accounts. Franchise Tax
For reports due in 2026 and 2027, entities with total revenue of $2.65 million or less owe no franchise tax. You still have to file a Public Information Report or Ownership Information Report even below that threshold. Skipping the report leads to penalties and can eventually cause the state to forfeit your right to do business in Texas.10Texas Comptroller. 2026 Texas Franchise Tax Report Information and Instructions
Sales and Use Tax
Businesses selling taxable goods or services must get a Texas Sales and Use Tax Permit before making taxable sales.11Texas Comptroller of Public Accounts. Texas Sales and Use Tax Frequently Asked Questions – Obtaining a Sales Tax Permit The state rate is 6.25%, with local jurisdictions allowed to add up to 2% more. Most unprepared groceries, prescription medications, and certain medical devices are exempt. Filing frequency is monthly, quarterly, or annual depending on how much tax you collect, with the Comptroller assigning the schedule. Monthly filers submit by the 20th of the following month; quarterly deadlines are April 20, July 20, October 20, and January 20.12Texas Comptroller of Public Accounts. Sales and Use Tax
Out-of-state sellers are not automatically exempt. If your total Texas revenue (taxable and nontaxable combined) exceeds $500,000 in the prior 12 calendar months, you must get a permit and start collecting. You have until the first day of the fourth month after crossing the threshold to begin.13Texas Comptroller of Public Accounts. Remote Sellers
Employment Taxes
Texas employers do not withhold state income tax, but they do owe state unemployment insurance tax to the Texas Workforce Commission. For 2026, rates run from 0.32% to 6.32% of the first $9,000 in wages paid to each employee per year. New employers receive a default rate until they build enough history for an experience-based rate.14Texas Workforce Commission. Your 2026 Tax Rates
Every Texas employer must report new hires and rehires to the Texas Workforce Commission within 20 calendar days of the hire date. Employers reporting electronically submit approximately twice a month, spaced 12 to 16 days apart.15Texas Workforce Commission. New Hire Reporting
Federal payroll still applies in full. Even without state withholding, Texas employers must withhold federal income tax, Social Security tax (6.2% each for employer and employee), and Medicare tax (1.45% each), typically reported to the IRS quarterly on Form 941.