Taxes in Allen
Texas has no state personal income tax -- a statewide fact that applies fully to Allen -- and Allen's combined sales tax rate is 8.25% (6.25% state plus 2% local add-ons), the maximum combined rate Texas law allows any jurisdiction to reach. As in the rest of Texas, property tax is where the real state-and-local tax weight lands for an Allen household; see the buying-a-home topic page for the specific overlapping city/ISD/county/college rate detail.
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Learn moreNo State Income Tax
Texas is one of a small number of states with no state personal income tax, applying statewide and not specific to Allen. It's the single largest driver of Allen's overall tax competitiveness relative to income-tax states, and it matters directly when comparing take-home pay for a job offer in the DFW area against one in an income-tax state.
Allen's Combined Sales Tax Rate
The combined sales tax rate in Allen is 8.25% as of 2026, per Avalara rate data reviewed August 2026: Texas's 6.25% base state rate plus 2% in city and special-purpose-district add-ons. This is at the statutory ceiling -- Texas law caps combined local sales tax add-ons at 2%, so 8.25% is the maximum any Texas jurisdiction can reach, the same rate cited for Dallas in this site's Dallas-stack research rather than an Allen-specific outlier.
Property Taxes: The Real Weight (See Full Detail on the Buying-a-Home Page)
Property tax is the tax that actually carries the structural weight Texas's lack of an income tax leaves behind. A City of Allen homeowner's bill layers the city's own $0.41540 per $100 rate (FY 2025-2026), Allen ISD's $1.1258 per $100 rate, and additional Collin County and Collin College levies -- combined annual bills commonly run $5,796-$8,350 depending on the specific taxing-district overlap, per Ownwell's 2026 aggregated data. See the buying-a-home topic page for the full breakdown; this page intentionally does not repeat all of it.
2026 Homestead Exemption Increase (Statewide, Applies to Allen)
Texas's general homestead exemption for school-district property taxes rose to $140,000 in 2026 (up from $100,000), with an additional $60,000 exemption for homeowners 65 or older or with a qualifying disability (a combined $200,000 for seniors), per property-tax guides reviewed August 2026 and consistent with this site's Dallas-stack research on the same statewide change. This applies fully to an owner-occupied Allen home the same as anywhere else in Texas -- new buyers generally need to file their own homestead exemption application rather than assuming it transfers from the prior owner.
Key takeaways
- No Texas state income tax -- applies statewide, the single biggest driver of overall tax competitiveness, not an Allen-specific advantage.
- Allen's combined sales tax rate is 8.25% (6.25% state + 2% local), the statutory maximum any Texas jurisdiction can reach.
- Property tax is the real local tax weight -- a typical combined Allen bill (city + Allen ISD + Collin County + Collin College) runs roughly $5,796-$8,350/year; see the buying-a-home page for the full rate breakdown.
- Texas's 2026 homestead exemption increase ($140,000 general, $200,000 combined for seniors 65+) applies fully to Allen owner-occupants -- file your own application; it doesn't transfer automatically from a prior owner.
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