Texas Paycheck Calculator 2024 vs 2025 Changes
Texas Paycheck Calculator 2024 vs 2025 Changes
Introduction
A good deal of your paycheck calculus when you live and work in Texas is about federal tax regulations, since there is none whatsoever of a state income tax in Texas. However federal withholding tables, Social Security provisions, Medicare regulations and new federal laws can alter the appearance of take-home pay every year.
In this article, you’ll learn:
- Texas paycheck assumptions.
- The major differences are between 2024 and 2025 (federal / payroll).
- Comparisons of practical examples.
- Some points and frequently asked questions on how to ensure your paycheck is correct.
Let’s dive in.
1. The Baseline: What Doesn’t Change Between 2024 and 2025
| Factor | Texas State Income Tax | Local Income Tax | State Withholding | State Payroll Tax on Wages |
|---|---|---|---|---|
| 2024 | None | None | None (no state income tax) | None for employee; employer pays SUTA |
| 2025 | None | None | None | Same principle — employees still don’t pay state income withholding |
- Since no individual income tax exists in Texas, the paycheck calculator of Texas never takes into account state income tax withholding.
- In Texas, local income taxes levied on wages are not observed in cities or counties.
- Both year calculations revolve around federal income tax withholding, Social Security, Medicare, potential extra Medicare surtax, and any pre-tax / post-tax deductions (401 (k), health insurance, HSA, etc.).
In this way, the 2024 2025 game changers are virtually all federal or payroll-based changes.
2. Key Changes from 2024 → 2025 (That Affect Net Pay)
The following are the key changes to be aware of when comparing the calculation of paycheck in 2024 and 2025:
a. Federal Withholding Tables & Standard Deductions
-
The IRS regularly increases and decreases tax brackets and amounts of standard deductions to compensate taxes according to inflation. Those thresholds change to an upward one in 2025.
- Indicatively, some sources show that the standard deduction of a single filer in 2025 will be 15,000.
- Due to this, at the same gross salary and deduction structure, less federal tax will be taken in 2025 than in 2024 (other things being equal).
b. Social Security Wage Base Limit
- Only a certain wage base limit is subject to social security (OASDI) withholding. This limit will increase in 2025 but not in 2024, so a higher proportion of the wages of a high earner can be taxed by Social Security.
- As an example, according to the sources, the wage base of the Social Security (6.2%) reaches 176,100 in 2025 when it ceases to apply.
c. Medicare & Additional Medicare Surtax
- Under Medicare, the lowest rate of tax is 1.45% imposed on the entire wages.
- There is also another surtax (0.9) on over income above a threshold (e.g. > 200,000) to high earners under Medicare.
- That rule holds in 2025 as well.
d. New Overtime Deduction (Federal) — 2025 Legislation
These changes are somewhat more recent than in 2025, and are also a result of the One Big Beautiful Bill Act (OBBBA) which was signed July 4, 2025. Under this law:
- Any employees can use qualified overtime payments of up to 12,500 (or 25,000 in the case of joint filers) to offset their natural taxable income on the federal level.
- It will include that working overtime will have a new potential federal tax benefit in 2025 that it will not have in 2024.
- Notable caveats: this is limited to overtime income exceeding the ordinary rate, some amounts of modified adjusted gross income can be used to render some taxpayers ineligible, and this deduction does not exclude the overtime as a subject of the Social Security or Medicare tax.
Therefore, when an individual works a lot of overtime on a regular basis, his or her net paycheck in 2025 could be better than it was in 2024 due to this new deduction (to that amount of overtime).
e. Unemployment / SUTA (Employer-Side)
This does not directly decrease the amount of take-home pay paid to employees, but it is an element in the pay computation and in some cases, employer contributions or cost-plans:
- State unemployment insurance (SUTA / SUI) is paid by employers. Taxable wage base of SUTA in Texas is revised (such as PaycheckCity shows the wage base and rates of 2025).
- According to some sources, the new employer (new hire) rate of Texas SUI increases to approximately 2.7 per cent in 2025.
- These reforms can be indirectly related to employer choices, benefits, or plans of cost-sharing.
3. Example Comparison: 2024 vs 2025 for Same Gross Income
Let’s run a hypothetical:
-
Gross Salary: $60,000 per year
-
Filing Status: Single
-
No other extraordinary pre-tax deductions
-
No overtime (just base salary)
| Component | 2024 Estimate | 2025 Estimate | Explanation of Difference |
|---|---|---|---|
| Federal Income Tax Withholding | (Higher) | (Somewhat lower) | Because the standard deduction, brackets, and inflation adjustments shift in favor of the taxpayer, withholding may drop. |
| Social Security (6.2%) | Applied up to 2024 wage base | Applied up to 2025 wage base | If $60,000 < both wage bases, same 6.2% applies in both years |
| Medicare (1.45%) + Additional Surtax | 1.45% (no surtax, under thresholds) | 1.45% (same) | No change unless income exceeds the surtax threshold |
| Net (Take-home) | Baseline | Slightly higher | With lower federal withholding and no state tax, 2025 net may be somewhat higher |
When no changes are applied in the same year of both years, then the primary difference is due to changes in federal withholding, and probably the overtime deduction (where applicable).
Also, an employee working an overtime in 2025 may receive an additional increase in net compensation (on top of what would have been achieved in 2024) as a result of the new overtime deduction under OBBBA.
4. Tips to Ensure Your 2025 Paycheck Is Accurate
- File a new W-4 - file a new W-4 after any life event (marriage, kids), to be withheld properly.
- Record overtime earnings — when you work overtime, make certain that your employer acknowledges and uses the new federal deduction (when necessary).
- Check your benefits / pre-tax deductions - 401(k), HSA, etc, as it lowers the taxable income.
- Verify IRS changes halfway through the year- Congress occasionally makes changes.
- Enter into a 2025-specific calculator of paychecks - most websites have replaced the calculation tools with 2025 withholding, Social Security base, etc.
Frequently Asked Questions (FAQ)
Q1: Texas Will Texas ever tax income on wages?
A1: Texas has not indicated that it will establish state wage income tax by the year 2025. The fact that it is one of the features that make Texas stand out.
Q 2: Will the new overtime deduction be that my overtime is not taxed at all?
A2: No. It lowers federal taxable income on overtime wages which qualify, though Social Security and Medicare taxes are still in force.
Q3: Does the overtime deduction count in on contract or supplemental pay?
A3: Wages that qualify as a fair labor standard act (FLSA) as overtime only count. Voluntary overtime pay that is not subject to FLSA can be disqualified, even though it appears as bonus payments.
Q4 What happens when my earnings are higher than the Social Security wage base.
A4: At that point, you cease to pay Social Security tax when you reach the 2025 wage base (e.g. $176,100). Further earnings are still subject to only Medicare and Federal income tax.
Q5: Does Texas tax (city/county) payroll?
A5: No. The Texas cities / counties do not have local wage income tax.
Q6: Is it possible that there will be mid year tax reforms in 2025?
A6: Yes -- changes in legislation or IRS rules can take place. In the case of IRS notices, and employer communications, always take notice.
Conclusion
In Texas, state income tax will still not be included in your paycheck in 2024 and 2025. These changes are primarily at the federal level, including changes to withholding tables, standard deductions, Social Security wage base and a new overtime deduction, which will be introduced in 2025.