The No-Income-Tax Mirage
Texas has no state income tax — but among the highest property taxes in the country. For a household earning $200,000, we calculated the home price at which Texas’s property tax erases the no-income-tax advantage, by the state you’re moving from. The surprise: people leaving Florida and Washington pay more in Texas at any home price.
Key findings
- From Florida or Washington, Texas costs more. Both already have no income tax and a lower property-tax rate than Texas — so a $200K household pays more total state-and-local tax in Texas at any home price. The “no-income-tax” pitch is a mirage for these movers.
- From Illinois, Texas wins on both counts. Illinois has a higher effective property-tax rate (1.88%) and a 4.95% income tax — so an Illinois transplant saves on property tax and income tax simultaneously.
- From California, the break-even is about a $1 million home. Below ~$1M, the income-tax savings win; above it, California’s rock-bottom 0.70% property-tax rate makes Texas more expensive.
- From New York, Texas is cheaper for nearly everyone — the break-even sits north of $2 million.
Break-even home value, by origin state
Scenario: a married-filing-jointly household with $200,000 taxable income, moving to a Texas metro. “Break-even” = the home value where Texas’s property tax exactly cancels the income tax you stop paying. Modeled at a 1.80% Texas effective property-tax rate (see the range in methodology).
| Moving from | Income tax saved | Their property-tax rate | Break-even home (TX @1.8%) | Verdict |
|---|---|---|---|---|
| Illinois | $9,900 | 1.88% | Always cheaper in TX | Texas wins on both |
| New York | $10,864 | 1.30% | ~$2.17M home | TX cheaper for nearly all |
| California | $11,477 | 0.70% | ~$1.04M home | Break-even ~$1M home |
| Florida | $0 | 0.78% | No break-even | Texas costs MORE |
| Washington | $0 | 0.75% | No break-even | Texas costs MORE |
Texas income tax: $0 (no state income tax). Download the full dataset: CSV · JSON.
Methodology
The scenario. A married-filing-jointly household with $200,000 of taxable income. One income level was chosen so the figures are comparable across states; the direction of the result holds across incomes, the exact break-even shifts.
The formula. Break-even home value = (state income tax you stop paying by moving to Texas) ÷ (Texas effective property-tax rate − origin-state effective property-tax rate). When the origin state has no income tax and a lower property-tax rate, there is no break-even — Texas costs more at any home value.
Sources & dates. Effective property-tax rates (tax paid as a share of owner-occupied home value): Tax Foundation, 2024 — California 0.70%, New York 1.30%, Illinois 1.88%, Florida 0.78%, Washington 0.75%, Texas statewide 1.40%. State income tax computed from 2025 state brackets (Illinois flat 4.95% = $9,900; California and New York progressive ≈ $11,477 and $10,864). Texas levies no state income tax.
The Texas property-tax rate range. Texas rates are highly local. We modeled a 1.40%–2.00% effective owner-occupied range: 1.40% is the Tax Foundation statewide figure; ~1.6–1.7% reflects a Dallas-Fort Worth new buyer’s effective rate after the $140,000 homestead exemption; ~2.0% reflects higher-tax urban counties. The headline table uses 1.80%. (We explicitly excluded an erroneous “4.5%” Houston figure that surfaced in research — Houston’s effective owner-occupied rate is ~1.8–2.2%, not 4.5%.)
Limitations. This compares state income tax and property tax only. It does not model sales tax, federal SALT-cap interactions, deductions beyond the scenario, insurance, or differences in home prices between states. Texas county and metro rates vary widely. This is an illustration of tax dynamics, not individualized tax advice — consult a CPA for your situation.
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By the RelocateMeTX Editorial Team · Reviewed June 2026 How we verify →
Facts on this page are checked against primary sources. This guide is for informational purposes only and does not constitute professional financial, legal, or medical advice.