Taxes in Austin
Texas has no state personal income tax -- already established at the state level and restated briefly here -- and Austin/Travis County residents pay a combined sales tax rate of 8.25% (6.25% state plus 2% in local add-ons), the maximum combined rate allowed under Texas law. Beyond income and sales tax, property tax (covered in depth on its own topic page) is where most of an Austin household's real state-and-local tax burden actually lands.
Exploring the idea of moving?
We can connect you with a local real estate professional who knows the area -- no pressure, just a starting point.
Learn moreNo State Income Tax (Briefly Restated)
Texas is one of a small number of U.S. states with no state personal income tax, a structural fact that applies statewide and is not Austin-specific -- see the Texas state page for the full context. It is the single largest driver of Austin's overall tax competitiveness relative to income-tax states, and matters directly when comparing take-home pay for a job offer in Austin against one in a state that does levy income tax.
Austin's Combined Sales Tax Rate
The combined sales tax rate in Austin is 8.25% as of 2026, per multiple sales-tax rate aggregators (Avalara, SalesTaxHandbook, TaxCloud) reviewed August 2026: 6.25% Texas state sales tax plus 2% in local add-ons (1% City of Austin, plus 1% for special districts, which commonly includes a dedicated Capital Metro transit tax in the transit authority's service area). This is the maximum combined state-and-local sales tax rate allowed anywhere in Texas -- local jurisdictions cannot exceed 2% in combined local add-ons on top of the 6.25% state rate, so Austin is already at the statutory ceiling, not an outlier city pushing rates unusually high.
Property Taxes (Summary -- See Full Topic Page)
Property taxes are the other major state-and-local tax an Austin homeowner pays, and they vary meaningfully depending on the exact combination of overlapping taxing entities (county, city, school district, community college, and other special districts), and on whether the property carries a homestead exemption and Texas's 10% appraisal cap. See the property-taxes topic page for millage rates, the recently expanded homestead exemption, and how the appraisal cap affects long-term owners differently than new buyers -- that page has the real numbers this summary intentionally does not repeat.
No Real Estate Transfer Tax
Texas is one of the states that levies no real estate transfer tax on property sales -- a genuine, if modest, cost advantage at closing relative to most other states, which do charge some form of deed/transfer tax. See the buying-a-home topic page for the fuller closing-cost picture.
Key takeaways
- No Texas state income tax -- applies statewide, not an Austin-specific advantage, but the single biggest driver of overall tax competitiveness.
- Austin's combined sales tax rate is 8.25% (6.25% state + 2% local: 1% city + 1% special district, commonly including a dedicated Capital Metro transit tax) -- the maximum combined rate allowed under Texas law.
- Property taxes are the other major local tax exposure -- see the property-taxes topic page for rates, the 2026 homestead exemption increase, and the 10% appraisal cap.
- Texas levies no real estate transfer tax on property sales, a real if modest closing-cost advantage versus many other states.
Want to know what your budget actually buys here?
Tell us a bit about what you're looking for and we'll connect you with someone local who can walk you through real numbers.
Get local guidanceRead the full Austin overview for the complete picture -- housing, taxes, climate, and who this place genuinely fits.
Planning a move?
Tell us what you're looking for and we'll connect you with a local expert who can help you make it happen.
Talk to a local expert