Texas Tax Brackets: Federal Rates, Sales, and Property Tax

Texas tax brackets for personal income don’t exist. The Texas Constitution bars the legislature from imposing a tax on personal net income unless voters approve one in a statewide referendum, and no such vote has ever been held.¹ The only income tax brackets that apply to your paycheck in Texas are the federal ones set by the IRS. You don’t file a state income tax return, you don’t calculate state withholding, and there is no state rate chart to look up.

Why Texas Has No Income Tax Brackets

Article VIII, Section 24 of the Texas Constitution blocks a state personal income tax unless a majority of registered voters approve it at the ballot box.¹ The same provision caps any such tax at 8% and directs the revenue toward reducing school district property taxes. Because no referendum has ever happened, Texas remains one of the handful of states with no personal income tax of any kind. The state funds itself through sales taxes, property taxes, business taxes, and targeted levies instead.

Federal Income Tax Brackets for 2026

Federal income tax is progressive. Your income gets taxed in layers, each with its own rate, starting at 10% and topping out at 37%. You pay the top rate only on the dollars that fall inside the top bracket, not on your whole income.

For tax year 2026, the brackets for single filers are:²

10% on income up to $12,400
12% on income from $12,401 to $50,400
22% on income from $50,401 to $105,700
24% on income from $105,701 to $201,775
32% on income from $201,776 to $256,225
35% on income from $256,226 to $640,600
37% on income above $640,600

Married couples filing jointly get wider bands. The 10% rate covers the first $24,800, the 12% rate runs up to $100,800, and the thresholds continue scaling until the 37% rate takes over above $768,700.²

How the Layered Math Actually Works

A single Texas resident with $80,000 in taxable income for 2026 does not pay 22% on the whole amount. The first $12,400 is taxed at 10% ($1,240), the next slice up to $50,400 at 12% ($4,560), and only the remaining $29,600 at 22% ($6,512). Total federal tax: about $12,312, an effective rate near 15.4%. This is where people routinely overestimate what they owe.

Standard Deduction

Brackets apply to taxable income, not gross pay. You first subtract the standard deduction or your itemized deductions. For 2026, the standard deduction is $16,100 for single filers, $32,200 for married couples filing jointly, and $24,150 for heads of household.² Traditional retirement contributions, student loan interest, and similar adjustments can shave the number down further before any bracket applies.

The Taxes Texas Does Charge

With no income tax, Texas pulls revenue from other sources. These are the ones most residents will actually encounter.

Sales and Use Tax

The state sales tax rate is 6.25% on most goods and many services.³ Cities, counties, and special districts can add up to 2% on top, bringing the combined ceiling to 8.25%.⁴ Most urban areas sit near that cap.

Grocery staples like cereals, dairy, meat, produce, and eggs are exempt from sales tax.⁵ Prepared food from restaurants and delis is not. Prescription medications dispensed by a licensed practitioner are also exempt.⁶ If you buy taxable goods from an out-of-state seller who doesn’t collect Texas sales tax, you owe use tax at the same rate.

Property Tax

Property tax is where Texans feel the biggest bite. The state itself collects no property tax and sets no rate. Each local taxing unit (school districts, counties, cities, and special districts) sets its own rate and applies it to the appraised value of your property. Rates vary widely depending on which jurisdictions overlap at your address, and Texas consistently ranks among the higher-property-tax states nationally.

Owner-occupants can claim a homestead exemption that reduces taxable value by $140,000 for school district taxes.⁷ Some cities and counties layer on additional exemptions. Homeowners 65 or older and those with disabilities get extra exemptions and a ceiling that freezes their school district taxes at the amount owed in the qualifying year.⁸

If your appraisal looks too high, you can file a formal protest with your local appraisal district. The deadline is May 15 or 30 days after you receive your appraisal notice, whichever is later. There’s no filing fee and no lawyer required.

Franchise Tax on Businesses

Texas taxes most businesses through the franchise tax, sometimes called the margin tax. It applies to corporations, LLCs, partnerships, and similar entities. Sole proprietorships and general partnerships owned entirely by natural persons are generally exempt. The standard rate is 0.75% of taxable margin; retail and wholesale businesses pay 0.375%. For the 2026 report year, businesses with total revenue at or below $2,650,000 owe no franchise tax, though they still need to file a “no tax due” report by May 15.⁹

Motor Vehicle and Hotel Taxes

When you buy a vehicle in Texas, the state charges 6.25% of the purchase price minus any trade-in allowance. Bring a vehicle in from another state and you owe the same 6.25%, less any sales tax you already paid to the other state.¹⁰ The state also charges 6% on hotel rooms costing $15 or more per night, with city and county hotel taxes stacked on top.¹¹

No State Estate or Inheritance Tax

Texas imposes no estate tax and no inheritance tax. Heirs owe nothing to the state on what they receive. Federal estate tax still applies to very large estates, but the federal exemption is high enough that it reaches very few families.

1
State of Texas. Texas Constitution Article VIII – Taxation and Revenue
2
Internal Revenue Service. IRS Releases Tax Inflation Adjustments for Tax Year 2026
3
State of Texas. Texas Tax Code Section 151.051 – Sales Tax Imposed
4
Texas Comptroller of Public Accounts. Local Sales and Use Tax Collection – A Guide for Sellers
5
Texas.Public.Law. Texas Tax Code Section 151.314 – Food and Food Products
6
Texas.Public.Law. Texas Tax Code Section 151.313 – Health Care Supplies
7
State of Texas. Texas Tax Code Section 11.13 – Residence Homestead
8
Texas Comptroller of Public Accounts. Property Tax Exemptions
9
Texas Comptroller of Public Accounts. Franchise Tax
10
Texas Comptroller of Public Accounts. Motor Vehicle – Sales and Use Tax
11
Texas Comptroller of Public Accounts. Hotel Occupancy Tax