Colorado vs Texas Property Tax Comparison (2026)

OVERVIEW

Colorado has dramatically lower property taxes than Texas — 0.51% average effective rate versus Texas at 1.60%. On a $600,000 home, Colorado saves approximately $6,540/year compared to Texas. This difference stems from Colorado's TABOR (Taxpayer's Bill of Rights) amendment and the legacy of the Gall…

Section 01

The Big Picture

Top-line rates and effective take-home for a typical earner — including income tax, social contributions, and applicable surcharges.

⛰️

COUNTRY A

Colorado

TAX RATE

0.51%

Avg Effective Rate

Among the lowest in the US; TABOR and Gallagher legacy keep rates low

🤠

COUNTRY B

Texas

TAX RATE

1.60%

Avg Effective Rate

No income tax; high property tax funds local services and schools

Section 02

Tax Savings by Income Level

Net take-home after all income tax, social contributions, and surcharges — for a single employee with no dependents.

GROSS INCOME

⛰️ CO TAX

🤠 TX TAX

SAVINGS

10-YEAR

$400,000 home

$2,040

$6,400

$4,360

$43,600

$600,000 home

$3,060

$9,600

$6,540

$65,400

$800,000 home

$4,080

$12,800

$8,720

$87,200

$1,000,000 home

$5,100

$16,000

$10,900

$109,000

$1,500,000 home

$7,650

$24,000

$16,350

$163,500

$2,000,000 home

$10,200

$32,000

$21,800

$218,000

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⛰️

Colorado Pros & Cons

+ PROS

Among the lowest property tax rates in the United States
TABOR limits government revenue growth — property taxes stay constrained
Low flat income tax (4.40%) and declining
Denver/Boulder home values appreciate strongly — low rate means low bills

− CONS

State income tax at 4.40% (Texas has none)
Denver and Front Range have very high home prices
Senior homestead exemption recently adjusted — check current thresholds
Property tax funded services (schools, roads) can be constrained by TABOR

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Texas Pros & Cons

+ PROS

No state income tax — saves $4,400–$22,000+ depending on income
Lower home prices than Colorado in most markets
Homestead exemption: $100,000 off school taxable value
Over-65 school tax freeze

− CONS

Property tax rate 3× Colorado average
On expensive homes, property tax bill 3× more than Colorado
High homeowners insurance in some areas
MUD districts can push effective rates above 2% in some suburbs

FAQ

Frequently Asked Questions

Why is Colorado's property tax so much lower than Texas?

Colorado's low property tax stems from two historical mechanisms: (1) The Gallagher Amendment (1982–2020) required residential assessment ratios to stay at ~7.2% of actual value — meaning tax was levied on only 7.2% of market value. Though Gallagher was repealed in 2020, assessment ratios have since been set by legislature, generally staying at 6.765% for residential property. (2) TABOR (Taxpayer's Bill of Rights, 1992) limits growth in government spending and revenue, constraining millage rate increases. Texas has no such structural constraints and relies heavily on property tax to fund education with no income tax alternative.

Who pays less in total taxes — Colorado or Texas?

It depends on income and home value. For a household earning $100,000 with a $600,000 home: Colorado property tax ~$3,060 + income tax ~$4,400 (4.40% flat) = ~$7,460. Texas property tax ~$9,600 + income tax $0 = $9,600. Colorado wins by ~$2,140. For the same household with a $300,000 home: Colorado ~$1,530 + $4,400 = $5,930. Texas ~$4,800 + $0 = $4,800. Texas wins by ~$1,130. The crossover typically occurs around $400,000–$500,000 in home value for middle-income earners — above that, Colorado's dramatically lower property tax generally wins.

How does Colorado's property tax affect the Denver real estate market?

Colorado's low property tax rate significantly reduces the ongoing cost of Denver homeownership relative to the purchase price — making expensive homes more affordable on an annual basis than in Texas or Illinois. A $1M Denver home costs approximately $5,100/year in property tax; the same value home in Houston would cost $16,000/year. This low annual burden partly explains why Denver home prices have risen significantly relative to incomes — buyers can afford higher purchase prices when carrying costs are low. However, rising home values mean higher absolute dollar tax bills even at the low rate.

Is Colorado or Texas better for tech workers and remote employees?

Both states attract tech workers, but for different reasons. Colorado (Denver/Boulder): lower property tax on expensive homes; excellent outdoor lifestyle; strong tech/startup scene; 4.40% flat income tax; home to many aerospace, clean energy, and tech companies. Texas (Austin/Dallas): no income tax is a major draw for high earners; Austin's tech scene (Apple, Tesla, Oracle, Dell); lower home prices in suburban areas; but high property tax on homes. For a remote tech worker earning $200,000 with a $900,000 home: Colorado owes ~$8,800 income tax + ~$4,590 property tax = $13,390. Texas: $0 income tax + $14,400 property tax = $14,400. Colorado is marginally cheaper overall at this income and home value combination.

⛰️ COUNTRY A Colorado VS 🤠 COUNTRY B Texas