Texas payroll taxes
Every tax withheld from a Texas paycheck or paid by the employer in 2026, with rates and wage limits.
Last verified November 2, 2026. Sources: twc.texas.gov, taxfoundation.org, oregon.gov.
| Tax | Employee pays | Employer pays | Wage limit |
|---|---|---|---|
| Social Security | 6.2% | 6.2% | $184,500 |
| Medicare | 1.45%* | 1.45% | No limit |
| FUTA | — | 0.6% | $7,000 |
| Texas SUTA | — | 2.7% (new) | $9,000 |
| Texas income tax | None | — | — |
*Plus 0.9% Additional Medicare Tax withheld on wages over $200,000. FUTA rate shown is net of the state credit.
State unemployment insurance
Texas charges new employers 2.7% on the first $9,000 each employee earns in a year. After a few years, the rate is based on the employer's layoff history and ranges from 0.32% to 6.32%. The new employer rate is the greater of 2.7% or the industry average. Wage base fixed by statute.
Replenishment tax 0.21% (reduced 0.10% to offset ETIA), Obligation Assessment 0.01%, and Employment and Training Investment Assessment (ETIA) 0.10%, all included in the effective rates
Register and file with the Texas unemployment tax agency.
Income tax withholding
Texas does not tax wages, so there is no state income tax withheld from paychecks.
Frequently asked questions
- What payroll taxes do employers pay in Texas?
- Social Security, Medicare, federal unemployment (FUTA) and Texas unemployment insurance (SUTA).
- What is the Texas SUTA wage base for 2026?
- $9,000 per employee.
- Does Texas require state income tax withholding?
- No. Texas has no tax on wages.