Self-Employed Tax Calculator — Texas (2026)
Self-employed in Texas? Your tax bill has three layers that a W-2 employee never sees in full: 15.3% self-employment tax on 92.35% of net profit, federal income tax, and no Texas income tax at all. This calculator applies all three to your 2026 net profit and shows the quarterly amount you should be setting aside. Texas does not levy a personal state income tax, so the only mandatory withholding on your earnings is federal income tax plus FICA (Social Security and Medicare).
Texas Self-Employed Tax Calculator
Gross 1099 income minus business expenses.
Self-employment tax vs Texas income tax
Self-employment tax is federal and identical in all 50 states: 12.4% Social Security up to $184,500 of net earnings plus 2.9% Medicare with no cap. Half of it is deductible against income tax, which is why the calculator subtracts it before applying brackets.
Because Texas levies no income tax, the same $80,000 of net profit costs about $18,830 in total tax — one of the lighter loads in the country for freelancers.
Texas funds government through high property taxes (avg 1.68% effective rate) and a 6.25% state sales tax (up to 8.25% with local).
Deductions that matter for Texas freelancers
Net profit — not gross revenue — drives every number here. Ordinary and necessary business expenses reduce SE tax, federal tax simultaneously: the 2026 standard mileage rate of $0.67/mile, home-office square footage, software, equipment, professional insurance, and the self-employed health insurance deduction.
Retirement plans go further. A SEP-IRA or solo 401(k) reduces income tax (though not SE tax) and is often the largest single deduction available to a profitable energy contractor in Austin.
Working for yourself in Texas
Texas's economy leans on energy, tech, and healthcare, which shapes the contractor market around Austin — and your fixed costs. With one-bedroom rent near $1,650, a freelancer needs meaningfully more gross revenue than an employee to reach the same lifestyle, because there is no employer paying half of FICA.
Texas is one of nine US states with zero state income tax — your entire paycheck is only reduced by federal taxes and FICA.
Local and payroll taxes Texas adds on top
Texas adds no state-mandated employee payroll deduction beyond FICA, so nothing extra is taken from your gross pay at the state level.
Texas funds government through high property taxes (avg 1.68% effective rate) and a 6.25% state sales tax (up to 8.25% with local).
Nobody withholds these for you when you are self-employed in Texas. Local wage taxes, city business licences and gross-receipts style levies are yours to register for and remit alongside your quarterly federal and state estimates.
Working across a state line from Texas
Texas has no income-tax reciprocity agreements, so if you live here and work across a state line you generally file a nonresident return in the work state and claim a credit at home to avoid double taxation.
Remote and hybrid work complicates this further: most states tax income where the work is physically performed, so a Austin resident spending part of the year at a client site in California may owe a nonresident return there. Keep a day-count log if you split time between states.
The rest of your Texas tax bill
Texas charges a 6.25% state sales tax, homeowners pay an average effective property tax of 1.68% of market value, and the minimum wage in force during 2026 is $7.25 an hour.
Local add-ons cap the combined rate at 8.25%.
Income tax is only one part of a state's take. Texas recovers revenue through sales and property tax as well, which is why headline income tax rates alone are a poor guide to how far a salary really goes. With no state income tax, Social Security, pensions, 401(k) and IRA withdrawals are all free of state tax here.
Texas vs California on the same salary
On a $90,000 salary, a single filer keeps about $72,145 a year in Texas against roughly $67,731 in California — a difference of $4,414, or $368 a month.
Effective combined rates are 19.8% in Texas and 24.7% in California. Set that gap against living costs: index 92 here versus 142 there, with property tax at 1.68% and 0.71% respectively.