Retirement planning for Texas.
No state income tax. Start with your situation
Start with your situationTexas at a glance (2026)
- Top combined rate
- 37%
- State tax model
- None
- Standard deduction
- $16,100
- RMD start age
- 73
No state income tax
Texas does not levy a state income tax. Your 401(k)/IRA withdrawals, Roth conversions, Social Security, and investment gains are taxed only at federal rates (10-37%).
Texas retirement planning insights
- Texas has no state income tax. Your combined top rate is the federal 37%, making it one of the most tax-efficient states for retirement withdrawals
- With no state tax, Roth conversions in Texas cost only the federal rate. Converting during low-income early retirement years can lock in 10-22% total tax on money that would otherwise be taxed at higher rates in the future
- Texas retirees keep 100% of Social Security, pension income, and investment gains at the state level. Withdrawal sequencing still matters for federal tax, but the state component is zero
- The trade-off: Texas has higher property taxes (averaging 1.6-1.8% of home value) which offsets some of the income tax savings, especially for homeowners
Frequently asked questions
Is Texas a good state to retire in for taxes?
For income tax purposes, Texas is among the best. Zero state income tax means 401(k)/IRA withdrawals, Roth conversions, Social Security, and investment gains are taxed only at federal rates. The trade-off is higher property taxes (averaging 1.6-1.8%) and sales tax (6.25% state + local).
Should I do Roth conversions in Texas?
Texas is one of the best states for Roth conversions because you pay only federal tax on the conversion, with no state tax on top. If you're in low-income early retirement years, converting at 10-22% federal can save tens of thousands compared to later RMD-forced withdrawals at higher rates.
How does no state tax affect withdrawal strategy?
Without state tax, your withdrawal strategy focuses on federal bracket management: staying under the 22% bracket ($98,900 MFJ), managing Social Security taxation thresholds ($32K/$44K combined income), and avoiding the 3.8% NIIT above $250K MFJ.
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Start with a Texas situation.
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