No state income tax: What DFW residents actually save (and what we pay instead)

Everyone knows Texas has no state income tax. But what does that actually mean for your wallet?

The savings (compared to other states):

| Salary | TX Tax | CA Tax | NY Tax | Savings vs CA | Savings vs NY | |--------|--------|--------|--------|---------------|---------------| | $60K | $0 | $2,700 | $3,200 | $2,700 | $3,200 | | $100K | $0 | $6,100 | $5,800 | $6,100 | $5,800 | | $150K | $0 | $11,200 | $9,400 | $11,200 | $9,400 | | $200K | $0 | $17,400 | $13,200 | $17,400 | $13,200 |

Source: Tax Foundation state income tax calculators, 2026 rates.

What we pay INSTEAD:

• Property tax: DFW average 2.0-2.2% (national average ~1.1%). On a $400K home: $8,000-8,800/year.
• Sales tax: 8.25% in most DFW cities (6.25% state + 2% local). Source: Texas Comptroller.
• Vehicle registration: $50-75/year base + county fees.
• Toll roads: $150-250/month average for toll commuters.

The real comparison ($100K salary, $400K home):

| Category | Texas (DFW) | California | New York | |----------|------------|------------|----------| | State income tax | $0 | $6,100 | $5,800 | | Property tax | $8,400 | $4,800 | $8,000 | | Sales tax impact | $2,500 | $2,100 | $2,400 | | Total state/local tax | $10,900 | $13,000 | $16,200 |

Bottom line: Texas IS cheaper overall, especially at higher incomes. But it's not free. Property taxes and sales taxes close the gap more than most people realize.

Sources:

• Tax Foundation — state tax comparison tools
• Texas Comptroller — sales tax rates
• County appraisal districts — property tax data

Are you actually saving money by being in Texas?