Texas Self-Employment Tax for Freelancers 2026

Texas Constitution Article VIII, Section 24-a bars a tax on individual net income (added Nov. 5, 2019). There is no Texas state income tax return, no state withholding on wages, and no state estimated-tax voucher for individuals comparable to what other states require. This applies equally to W-2 employees and self-employed residents. What it does not do is cancel any federal tax obligation tied to self-employment income.

Three federal layers apply to every Texas freelancer regardless of state residency:

• Self-employment tax on net Schedule C profit, covering Social Security and Medicare
• Federal income tax on taxable income after deductions
• IRS quarterly estimated payments, since no employer withholds tax from 1099 income

The federal Self-Employment Tax Calculator on FreelanceMath computes the first layer. Federal income tax on the remaining taxable income and the quarterly schedule are handled separately, and both apply the same way to a Texas resident as they would to a resident of any other state. Schedule SE is federal, including for Texas residents.

Texas franchise (margin) tax is a separate matter from personal income tax, and freelancers sometimes confuse the two. The tax applies to formally organized entities such as LLCs, corporations, and limited partnerships. It does not apply to an individual operating as an unincorporated sole proprietorship. See the Texas Comptroller Franchise Tax overview.

For 2026-27 report years, the no-tax-due threshold is $2,650,000 in annualized total revenue, and reports are due May 15, 2026. A freelancer earning $61,275 as a sole proprietor sits far below any relevant threshold and, more importantly, is not the type of entity the tax targets at all.

The Houston copywriter's federal SE tax follows the standard Schedule SE sequence:

Texas personal income tax on this profit is $0.00, under the constitutional no-PIT provision described above. As a sole proprietor with no LLC or corporation formed, this freelancer has no Texas franchise-tax filing obligation. What remains is federal income tax on adjusted gross income after the standard deduction, plus the SE tax already calculated.

Run the Houston example through the federal SE Tax Calculator to see these numbers reproduced. That tool computes federal SE tax only. It does not calculate franchise tax, since franchise tax is a separate entity-level tax rather than an individual income tax.

There is no Texas estimated-tax coupon for individuals. IRS Form 1040-ES is the only estimated-payment calendar that applies, with 2026 due dates of April 15, June 15, and September 15, 2026, and January 15, 2027. The Quarterly Tax Estimator covers this federal schedule. June 15 Q2 and how to pay the IRS walks through payment methods.

See how SE, federal income, and (where it exists) state tax stack and sole proprietor filing basics. How FreelanceMath sources tax constants is on the methodology page.

1. Texas Constitution, Article VIII, Section 24-aIndividual income tax prohibited; added Nov. 5, 2019.Last checked: 2026-09-06
2. Texas Comptroller, Franchise Tax2026-27 no-tax-due threshold $2,650,000; annual reports due May 15.Last checked: 2026-09-06
3. IRS 2026 Form 1040-ESLast checked: 2026-09-06
4. IRS Instructions for Form 8959Last checked: 2026-09-06
5. SSA Contribution and Benefit Base$184,500 for 2026.Last checked: 2026-09-06
6. IRS Rev. Proc. 2025-32Last checked: 2026-09-06