Why Texas attracts high earners
Zero state income tax means a $200K Austin engineer keeps roughly $11,000–$13,000 more annually than the same person in California, even before considering RSU and bonus differentials. The trade-off is property tax — Texas averages 1.6–2.2% of assessed value vs. California's Prop 13 cap.
The Austin / Houston salary gap
Big Tech in Austin pays 10–15% less than Bay Area at the senior level, but the tax + cost-of-living arbitrage usually nets positive above $180K base. Below that, the gap narrows fast.
Sales tax reality check
Texas combined sales tax averages 8.25%. On a typical household spending $50K/year on taxable goods, that's $4,125 — meaningful but still less than what CA income tax would charge at the same income.
FAQ
Does Texas tax bonuses or RSUs?
No state income tax means no state tax on bonuses or RSU income either. Federal supplemental withholding (22% under $1M, 37% above) still applies.
What about Texas property tax?
Texas property tax averages 1.6–2.2% of assessed value annually — among the highest in the US. Factor this into your effective tax burden if you own.
Do I owe Texas tax if I work remotely for a CA company?
If you're a Texas resident working remotely, you owe Texas (nothing) on wages — not California. Make sure your employer's payroll is set to TX, not CA, to avoid double withholding.
How this calculator is built
Independently maintained
Written by Sam Doshi and the RevenueLab editorial team. We don't sell the data feeds this tool is built on.
Sourced from primary data
Benchmarks come from public AdSense / Stripe / IRS disclosures and reader-submitted data — never third-party "$X per view" claims. Full methodology.
Last reviewed
June 2026. We re-check every figure on the platform on a rolling quarterly cycle.
Editorial standards
See our editorial policy and disclaimer. Results are estimates, not advice.