Pennsylvania has a flat 3.07% income tax that applies to all taxable income, while Texas has zero state income tax protected by its constitution. A $100,000 earner pays $3,070 annually in Pennsylvania state income tax vs $0 in Texas. However, Texas has significantly higher property taxes (1.68% vs PA's 1.53%), which can offset some savings for homeowners. Pennsylvania also taxes retirement income at the full 3.07% rate, while Texas exempts all retirement income. The Pennsylvania to Texas migration has accelerated as remote work enables East Coasters to keep their salaries while eliminating state income tax.

By CountryTaxCalc Research Team

Last Updated: April 2026

The Big Picture

🔔 Pennsylvania

3.07%

Flat Rate

Flat 3.07% state income tax on all taxable income

⭐ Texas

0%

No Income Tax

Constitutional prohibition on state income tax

Typical Annual Savings

At $100,000 income:

$3,070

That is $256/month back in your pocket!

Tax Savings by Income Level

IncomePA TaxTX TaxSavings10-Year
$50,000 $1,535$0$1,535$15,350
$75,000 $2,303$0$2,303$23,030
$100,000 $3,070$0$3,070$30,700
$150,000 $4,605$0$4,605$46,050
$250,000 $7,675$0$7,675$76,750
$80K retirement $2,456$0 (retirees)$2,456$24,560 (retirees)

Pennsylvania Pros and Cons

✅ Pros

  • Lower property tax rates (1.53% vs TX's 1.68%)
  • Proximity to major East Coast cities (NYC, DC, Boston)
  • No sales tax on groceries or clothing
  • Four seasons with beautiful fall foliage
  • Strong healthcare and education sectors (hospitals, universities)

❌ Cons

  • Flat 3.07% income tax on all income including retirement
  • Local income taxes in many cities (Philadelphia 3.75%, Pittsburgh 3%)
  • Cold winters with heating costs
  • Vehicle personal property tax (annual car tax)
  • Higher overall tax burden when combining state, local, and property

Texas Pros and Cons

✅ Pros

  • 0% state income tax (constitutional protection)
  • No tax on retirement income (Social Security, pensions, 401k)
  • No state estate or inheritance tax
  • Strong job market (Austin tech, Houston energy, Dallas business)
  • Lower cost of living outside major metros

❌ Cons

  • Higher property tax (1.68% average—4th highest in US)
  • Sales tax 6.25% state + up to 2% local (8.25% max)
  • Hot summers (100°F+ for months in most areas)
  • Limited public transportation outside Austin/Dallas cores
  • Hurricane risk along Gulf Coast (Houston area)
💡

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Frequently Asked Questions

Q: How much will I save moving from Pennsylvania to Texas?

At $100,000 income, you save $3,070 per year ($256/month) on state income tax. Pennsylvania charges 3.07%; Texas charges 0%. Philadelphia residents save even more—$6,820/year with the city's 3.75% tax eliminated. After accounting for Texas's higher property taxes, net savings are typically $2,500-6,000/year depending on home value and location.

Q: Doesn't Texas have higher property taxes?

Yes, Texas averages 1.68% (4th highest) vs Pennsylvania's 1.53%. On a $400K home: Texas charges ~$5,040/year (with exemptions) vs PA's ~$6,120. The difference is ~$1,000/year—far less than the $3,070+ income tax savings. For most earners, Texas still wins overall.

Q: Does Pennsylvania tax retirement income?

Yes, Pennsylvania taxes 401(k) withdrawals, IRA distributions, and pension income at the full 3.07% rate. Social Security is exempt. Texas taxes no retirement income. A retiree with $80K retirement income saves ~$2,456/year in Texas vs Pennsylvania.

Q: What about local income taxes in Pennsylvania?

Philadelphia charges 3.75% city income tax on top of PA's 3.07% state tax—totaling 6.82%. Pittsburgh charges 3% (6.07% total). Many suburbs charge 1-2%. Texas has no local income taxes anywhere. Philadelphia residents save $6,820/year at $100K by moving to Texas.

Q: How do sales taxes compare?

Pennsylvania: 6-8% (clothing and groceries exempt). Texas: 6.25-8.25% (groceries exempt, clothing taxed). Pennsylvania's clothing exemption saves families $200-500/year. Overall sales tax burden is similar.

Q: Is Texas or Pennsylvania better for retirees?

Texas wins clearly. Texas has no tax on any retirement income and offers 65+ property tax benefits (additional exemptions, tax freezes). Pennsylvania taxes retirement income at 3.07% and offers no special retiree property tax benefits. A $90K retirement income saves ~$1,900/year in Texas.

Q: What about Pennsylvania's vehicle tax?

Pennsylvania charges personal property tax on vehicles (varies by county, often ~$200-500/year). Texas has no annual vehicle property tax—just registration fees. This adds to Texas's advantage, especially for households with multiple vehicles.

Q: Which Texas cities attract Pennsylvania residents?

Austin attracts tech workers and young professionals. Dallas/Fort Worth attracts corporate relocations and families. Houston attracts energy sector workers and offers diversity. San Antonio is the most affordable and attracts retirees and military families. All offer dramatically lower taxes than Philadelphia or Pittsburgh.

Q: How do I establish Texas residency?

To establish Texas residency: (1) Spend 183+ days/year in Texas, (2) Get Texas driver's license within 30 days, (3) Register vehicles in Texas, (4) Register to vote in Texas, (5) Update address with banks, employer, IRS. Pennsylvania may audit high earners who claim to relocate.

Q: What are the trade-offs beyond taxes?

Pennsylvania offers proximity to East Coast cities, four seasons, established healthcare/education sectors, and cooler summers. Texas offers zero income tax, larger/faster-growing job markets (especially tech), warmer winters, but hotter summers and higher property taxes. Remote workers get the best of both—East Coast salary, Texas tax benefits.

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