Texas vs North Carolina Taxes
Compare the total tax burden between Texas (no income tax) and North Carolina (3.99% flat). Enter your income to see which state saves you more.
| Tax Component | Texas | North Carolina |
|---|---|---|
| Federal Tax | $13,170 | $13,170 |
| State Tax | $0 | $3,481 |
| FICA | $7,650 | $7,650 |
| Total Tax | $20,820 | $24,301 |
| Take-Home | $79,180 | $75,699 |
| Effective Rate | 20.82% | 24.30% |
| Annual Difference | $3,481 less | $3,481 more |
The $3,481 difference is primarily because North Carolina has a flat 4.3% income tax, while Texas has no state income tax. At your income level, North Carolina's marginal rate is 4.0%.
Why the difference
You'd pay $3,481/year ($290/month) more in North Carolina vs Texas.
Tax structure
Texas has no state income tax, while North Carolina has a flat 4.3% state income tax.
Effective rate at your income
At $100,000, Texas's effective state rate is 0.0% vs 3.5% in North Carolina — a 3.5 percentage point gap.
Tip: While you save on income tax, Texas property taxes can exceed $5,000-$10,000/year on a median-priced home. Factor in property tax when comparing total tax burden against income-tax states where property taxes may be lower.
Tip: With a flat tax rate, your effective state rate is predictable and consistent. Focus tax reduction on pre-tax contributions (401k, HSA) and any state-specific deductions or credits available.
Texas Total Tax
$20,82020.82% effective rate
North Carolina Total Tax
$24,30124.30% effective rate
Annual Savings
$3,481by living in Texas
Tax at Different Income Levels
| Income | Texas Total Tax | North Carolina Total Tax | Annual Savings |
|---|---|---|---|
| $75,000 | $13,408 | $15,891 | +$2,484 |
| $100,000 | $20,820 | $24,301 | +$3,481 |
| $150,000 | $36,209 | $41,685 | +$5,476 |
| $200,000 | $51,073 | $58,544 | +$7,471 |
Based on single filer, standard deduction, 2026 tax year. Includes federal income tax, state income tax, and FICA.
Why the difference
You'd pay $3,481/year ($290/month) more in North Carolina vs Texas.
Tax structure
Texas has no state income tax, while North Carolina has a flat 4.3% state income tax.
Effective rate at your income
At $100,000, Texas's effective state rate is 0.0% vs 3.5% in North Carolina — a 3.5 percentage point gap.
Tip: While you save on income tax, Texas property taxes can exceed $5,000-$10,000/year on a median-priced home. Factor in property tax when comparing total tax burden against income-tax states where property taxes may be lower.
Tip: With a flat tax rate, your effective state rate is predictable and consistent. Focus tax reduction on pre-tax contributions (401k, HSA) and any state-specific deductions or credits available.
Understanding Each State
Texas
Texas has no state income tax, relying instead on property taxes (among the highest in the US at ~1.6-1.8% of home value) and an 8.25% combined sales tax in most areas. For wage earners, the absence of income tax is a major advantage, but property owners face a significant ongoing cost.
Tip: While you save on income tax, Texas property taxes can exceed $5,000-$10,000/year on a median-priced home. Factor in property tax when comparing total tax burden against income-tax states where property taxes may be lower.
North Carolina
This state uses a flat income tax rate, meaning the same percentage applies to all taxable income regardless of how much you earn. This simplifies tax planning but means there is no bracket benefit for lower earners. The effective rate is very close to the headline rate after deductions.
Tip: With a flat tax rate, your effective state rate is predictable and consistent. Focus tax reduction on pre-tax contributions (401k, HSA) and any state-specific deductions or credits available.
Key Comparison Points
Income tax structure: Texas has no state income tax, while North Carolina has a flat income tax (3.99% flat).
Beyond income tax: State tax comparisons should also consider property tax rates, sales tax, and cost of living. A state with no income tax may have higher property or sales taxes that offset the savings.
SALT deduction cap: Under OBBBA, the 2026 federal SALT cap is $40,400, phasing out above $505,000 MAGI toward a $10,000 floor. This limits the federal tax benefit of living in a high-tax state, so the gross state tax difference remains close to the net difference for most earners — especially high earners inside the phaseout.
Frequently asked questions
Is it cheaper to live in Texas or North Carolina?
Based on income tax alone, Texas has a lower tax burden. At $100K income, you'd save $3,481 annually in Texas compared to North Carolina. However, total cost of living also depends on property taxes, sales taxes, and housing costs.
How much would I save moving from North Carolina to Texas?
A single filer earning $100,000 would save approximately $3,481 per year in total taxes by living in Texas instead of North Carolina. At $150,000 income, the savings change to $5,476 per year.
What is the income tax rate in Texas?
Texas has no state income tax.
What is the income tax rate in North Carolina?
North Carolina has a flat income tax with rates of 3.99% flat.
Does Texas have income tax?
No, Texas does not levy a state income tax. Residents pay only federal income tax and FICA. However, Texas may have higher property taxes or sales taxes to compensate.