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Does Texas Tax Capital Gains? No, Texas Has No Income Tax

Updated October 4, 2026. Quick answer: No. The Texas Comptroller states “Texas has no state income tax”, so a sale of stocks, funds or real estate adds no Texas income tax for an individual.

Selling your home? How the state taxes the profit, from its own tax documents: Does Texas tax the profit from selling your home?.

The same question for dividends and interest: does Texas tax dividends and interest.

How Texas treats capital gains

ItemWhat the documents say
TreatmentNot taxed by the state
Where it is writtenTexas Comptroller of Public Accounts, Fiscal Notes (2025)
Short-term and long-term gainsNo distinction: the state has no individual income tax

A $50,000 long-term gain

A $50,000 long-term gain adds $0 of Texas income tax. Federal tax on the gain still applies.

What changes in 2026

The latest document read prints no 2026 change to the way gains are taxed.

Federal rules

The state’s treatment sits on top of the federal one. The IRS explains the federal tax on gains in Topic no. 409, Capital Gains and Losses and Publication 550, Investment Income and Expenses.

Related: whether Texas taxes pensions, how Texas taxes retirement income, the capital gains tax by state table, and the federal capital gains tax calculator.

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Sources

Sources: the primary documents linked above, read on October 4, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.

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