Texas Payroll Tax Calculator

How to Use the Texas Payroll Tax Calculator:

Country and State Selection:
- The calculator is preset to “United States” and “Texas.” Please verify these selections to ensure calculations are based on Texas-specific tax laws. Remember, Texas has no state income tax, which significantly impacts your net pay!
Federal Filing Status and Allowances:
- Enter your federal filing status (e.g., Single, Married, Head of Household) and the number of allowances you’re claiming. This information is found on your W-4 form. Accurate entry is crucial for determining the correct amount of federal income tax to withhold.
Annual Pay Periods:
- Select the frequency with which you are paid (e.g., weekly, bi-weekly, semi-monthly, monthly). This determines how your annual salary is divided for per-pay-period withholding calculations.
Gross Wage / Pay Period:
- Input your total earnings for the current pay period before any deductions or taxes. Include your base salary, overtime, bonuses, or any other taxable income received during that period.
Pay Date:
- Specify the date you will receive your paycheck. While Texas has no state income tax, aligning the calculation with your specific payroll cycle can be important for other date-sensitive deductions.
Calculation:
- Once all information is entered, click the “Calculate” button. The calculator will process your data and provide a detailed breakdown of your estimated net pay, including:
- Gross Pay: Your total earnings before deductions.
- Federal Taxes: The amount withheld for federal income tax.
- Social Security and Medicare Taxes (FICA): These federal taxes fund Social Security and Medicare programs.
- Other Deductions: This will include deductions like health insurance premiums, retirement contributions (401(k), etc.), and any other pre-tax or post-tax deductions.

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Payroll Due Dates and Direct Deposit Schedule

Month	Payroll Type	Payroll Due Date	Last Day to Process & Cancel Direct Deposit	Paydates	Workdays & Hours per Month
September 2024	1st TM	Thursday 09/05/24	Tuesday 09/10/24	Monday 09/16/24	168 hours, 21 days
September 2024	2nd TM & Monthly	Friday 09/20/24	Wednesday 09/25/24	Tuesday 10/01/24	168 hours, 21 days
October 2024	1st TM	Friday 10/04/24	Wednesday 10/09/24	Tuesday 10/15/24	184 hours, 23 days
October 2024	2nd TM & Monthly	Wednesday 10/23/24	Monday 10/28/24	Friday 11/01/24	184 hours, 23 days
November 2024	1st TM	Tuesday 11/05/24	Friday 11/08/24	Friday 11/15/24	168 hours, 21 days
November 2024	2nd TM & Monthly	Wednesday 11/20/24	Monday 11/25/24	Monday 12/02/24	168 hours, 21 days
December 2024	1st TM	Thursday 12/05/24	Tuesday 12/10/24	Monday 12/16/24	176 hours, 22 days
December 2024	2nd TM & Monthly	Friday 12/20/24	Thursday 12/26/24	Thursday 01/02/25	176 hours, 22 days
January 2025	1st TM	Monday 01/06/25	Thursday 01/09/25	Wednesday 01/15/25	184 hours, 23 days
January 2025	2nd TM & Monthly	Thursday 01/23/25	Tuesday 01/28/25	Monday 02/03/25	184 hours, 23 days
February 2025	1st TM	Thursday 02/06/25	Tuesday 02/11/25	Tuesday 02/18/25	160 hours, 20 days
February 2025	2nd TM & Monthly	Thursday 02/20/25	Tuesday 02/25/25	Monday 03/03/25	160 hours, 20 days
March 2025	1st TM	Thursday 03/06/25	Tuesday 03/11/25	Monday 03/17/25	168 hours, 21 days
March 2025	2nd TM & Monthly	Friday 03/21/25	Wednesday 03/26/25	Tuesday 04/01/25	168 hours, 21 days
April 2025	1st TM	Friday 04/04/25	Wednesday 04/09/25	Tuesday 04/15/25	176 hours, 22 days
April 2025	2nd TM & Monthly	Tuesday 04/22/25	Friday 04/25/25	Thursday 05/01/25	176 hours, 22 days
May 2025	1st TM	Tuesday 05/06/25	Friday 05/09/25	Thursday 05/15/25	176 hours, 22 days
May 2025	2nd TM & Monthly	Wednesday 05/21/25	Tuesday 05/27/25	Monday 06/02/25	176 hours, 22 days
June 2025	1st TM	Thursday 06/05/25	Tuesday 06/10/25	Monday 06/16/25	168 hours, 21 days
June 2025	2nd TM & Monthly	Friday 06/20/25	Wednesday 06/25/25	Tuesday 07/01/25	168 hours, 21 days
July 2025	1st TM	Thursday 07/03/25	Wednesday 07/09/25	Tuesday 07/15/25	184 hours, 23 days
July 2025	2nd TM & Monthly	Wednesday 07/23/25	Monday 07/28/25	Friday 08/01/25	184 hours, 23 days
August 2025	1st TM	Wednesday 08/06/25	Monday 08/11/25	Friday 08/15/25	168 hours, 21 days
August 2025	2nd TM & Monthly	Thursday 08/21/25	Tuesday 08/26/25	Tuesday 09/02/25	168 hours, 21 days

Data Retrieved From: https://fmx.cpa.texas.gov/

Understanding Your Texas Paycheck

Texas Paycheck Quick Facts

Texas income tax rate: 0%
Median household income: $75,780 (U.S. Census Bureau)
Number of cities that have local income taxes: 0

How Your Texas Paycheck Works

Understanding your paycheck involves more than just your hourly wage or annual salary. Your employer withholds taxes and deductions, significantly impacting your take-home pay.

FICA Taxes

You and your employer each contribute 6.2% of your earnings for Social Security taxes and 1.45% for Medicare taxes. These combined taxes are known as FICA taxes.
FICA taxes are mandatory regardless of your state of residence.
Earnings exceeding $200,000 (single filers), $250,000 (joint filers), or $125,000 (married filing separately) are subject to an additional 0.9% Medicare surtax, which your employer does not match.

Other Deductions

Premiums for employer-sponsored health insurance and other benefits are deducted from your paycheck.
Contributions to retirement accounts like 401(k)s or medical expense accounts like Health Savings Accounts (HSAs) are also deducted. These are typically pre-tax deductions, reducing your taxable income.

Factors Affecting Your Paycheck

Marital status
Pay frequency
Wages
Federal Withholding (W-4)

Adjusting Your Withholding (W-4)

If you believe too much or too little is being withheld, you can file a new W-4 with your employer at any time.
Indicate any additional withholding to avoid a tax bill in April.
The W-4 has been updated, eliminating allowances and using a five-step process to enter dollar amounts for tax credits, non-wage income, deductions, and taxable wages.

Financial Guidance

A financial advisor can help you understand how taxes align with your financial goals.
SmartAsset’s free tool can match you with up to three vetted financial advisors in your area.
You can have a free introductory call with your advisor matches to decide which one you feel is right for you.
If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Texas Payroll Tax Advantages

Texas offers a unique advantage with its absence of state and local income taxes. This simplifies payroll for both employees and employers.

Simplified Tax Withholding: No state or local income tax withholding streamlines the payroll process.
Benefits for Self-Employed and Business Owners: Reduced tax withholding burden for entrepreneurs.
Advantage for Out-of-State Workers: Individuals living in income tax states but working in Texas enjoy a financial benefit compared to those working in their state of residence.

Important Tax Considerations Beyond Payroll

While Texas boasts no income tax, it’s crucial to consider other taxes that impact household budgets:

Sales Tax: Texas generally has higher sales tax rates to compensate for the lack of income tax.
Property Tax: Property taxes in Texas tend to be higher than in many other states. This can significantly affect homeowners’ finances.

Financial Planning

Comprehensive Budgeting: Factor in sales and property taxes when planning your household budget.
Relocation Considerations: If you’re considering moving to Texas, review our Texas mortgage guide for information on mortgage rates and details about each county.

Maximizing Your Texas Paycheck

In Texas, you can increase your paycheck by pursuing supplemental wages. These include:

Overtime pay
Bonuses
Commissions
Awards
Prizes
Retroactive salary increases

Texas Tax Advantage:

Since Texas has no state income tax, these supplemental wages are not subject to state taxation.

Federal Tax Considerations:

Supplemental wages are subject to federal income taxes.
The federal tax rate depends on how your employer handles these payments:
- Combined with Regular Wages: Taxed at your regular federal income tax rate.
- Disbursed Separately: Can be taxed at a flat rate of 22%.

Tax Strategy:

If your regular federal income tax rate is higher than 22%, it may be beneficial to request that your employer identify and tax your supplemental wages separately at the 22% flat rate.

Texas Payroll Taxes

Understanding payroll taxes is crucial for both employers and employees in Texas. Here’s a breakdown of essential information:

Texas-Specific Payroll Taxes

Form W-4: Employees must complete Form W-4 to determine federal tax withholding. If not completed, withhold as if no exemptions are claimed. Update the form for significant life events.
No State Income Tax: Texas does not have a state income tax.
No Reciprocity: Texas does not have income tax reciprocity with other states.
Additional Forms:
- Employer’s Quarterly Report (C-3)
- New Hire Report
Texas Unemployment Tax:
- Employers pay unemployment insurance tax to the Texas Workforce Commission.
- Tax applies to the first $9,000 of an employee’s wages.
- New employers: 2.7% rate.
- Experienced employers: 0.23%–6.23% rate.
- Payments are made quarterly.
Texas Minimum Wage: $7.25 per hour (2023).
Texas Overtime Pay: Federal rules under the Fair Labor Standards Act apply (time-and-a-half for hours over 40 per week).

Federal Payroll Taxes

Federal Income Tax:
- Withheld from employee pay based on Form W-4.
- Form W-4 is for employer records, not sent to the IRS.
FICA Taxes (Social Security and Medicare):
- Employer and employee each contribute:
  - 6.2% of wages for Social Security (up to $2,600 in 2023).
  - 1.45% of all wages for Medicare.
- Refer to the IRS for details on maximum thresholds.
FUTA (Federal Unemployment Tax):
- Employer-paid annual tax on the first $7,000 of each employee’s wages.
- 2023 rate: 6.0% (potential for 5.4% with tax credits).
- Form 940 is used for filing (annual or quarterly if over $500 owed).
Additional Medicare Tax:
- 0.9% withheld from employees earning over $200,000 annually.
- Filing status may affect applicability.

Federal Tax Payment Schedule

Federal Withholding, Additional Medicare, and FICA:
- Semi-weekly or monthly payments.
- Quarterly summary via Form 941.
FUTA:
- Annual or quarterly (if over $500 owed) via Form 940.

Additional Employer Responsibilities

Workers’ Compensation: Requirements vary; consult state guidelines.
New Hire Reporting:
- Report to the Texas New Hire Center within 20 days.
Payroll Stubs:
- Provide stubs with required information (company name, employee details, pay period, wages, deductions).
Final Paychecks:
- Due by the next scheduled payday for voluntary resignations.
- Due within six days for layoffs/terminations.
Time Off:
- Jury duty and voting leave (paid time off for voting if polls are not open for two hours outside of work).

Disclaimer: The content provided on this webpage is for informational purposes only and is not intended to be a substitute for professional advice. While we strive to ensure the accuracy and timeliness of the information presented here, the details may change over time or vary in different jurisdictions. Therefore, we do not guarantee the completeness, reliability, or absolute accuracy of this information. The information on this page should not be used as a basis for making legal, financial, or any other key decisions. We strongly advise consulting with a qualified professional or expert in the relevant field for specific advice, guidance, or services. By using this webpage, you acknowledge that the information is offered “as is” and that we are not liable for any errors, omissions, or inaccuracies in the content, nor for any actions taken based on the information provided. We shall not be held liable for any direct, indirect, incidental, consequential, or punitive damages arising out of your access to, use of, or reliance on any content on this page.

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