Texas loves to brag about having no state income tax, and that part is absolutely true.

But as with most things in politics, the full story lives in the fine print. If the state isn’t reaching into your front pocket, it may be digging around in the back one instead — and that’s where property taxes come in.

💰 Texas Doesn’t Have Income Tax — But Here’s The Catch

According to the latest WalletHub analysis, Texas ranks 7th highest in the nation for real estate property taxes. The breakdown looks at several factors, including:

Effective real estate tax rate
Annual taxes on a $322,700 home
State median home value
Annual taxes on a home priced at the state median value

But you can simplify all of that down to one number: 1.49%. That effective property tax rate is what lands Texas in the seventh spot nationally.

Now, none of this means the system is “wrong.” States have to fund roads, schools, law enforcement, and infrastructure somehow. Texas simply chose not to rely on income tax revenue. Instead, local governments lean heavily on property taxes to balance the books.

Still, there’s something that rubs people the wrong way about paying taxes year after year on a home you already bought and paid for. For many homeowners, it can feel like you’re renting your own property from the government indefinitely.