Our firm is based in Naperville, Illinois, and we work with Austin-area clients remotely; we have no Texas office. Austin has a distinct tax profile from the rest of Texas because so many residents work for, or found, technology companies. That means the common questions are less about Texas rules and more about what happens when income comes from somewhere else.
Working in Austin for an out-of-state employer
When you live in Texas but your paycheck comes from a company headquartered in California, New York or another income tax state, the question is whether that state can tax you. The answer turns on where you physically work and on that state's own rules. New York, for example, says a nonresident whose primary office is in New York State owes New York tax on telecommuting days unless the employer has established a bona fide employer office at the telecommuting location. Not every state follows that approach, and some states tax only the days you work inside their borders.
Mismatches also show up on the payroll side: an employer may withhold for the wrong state, or fail to withhold for Texas-based work at all. Our multi-state tax work looks at your work-day records, employer withholding and the credit rules, so you do not overpay or file late. See our Texas page and state income tax withholding guide for the basics.
Founders, equity and the Texas franchise report
Founders often form a Delaware C corporation or an LLC and then register in Texas. A company doing business in Texas files a franchise tax report each May 15. For report years 2026 and 2027 the no-tax-due threshold is $2,650,000 of revenue, so a young company typically owes no tax, but it still has to file a Public Information Report. Missing that filing can lead to penalties and possible forfeiture of the right to transact business in Texas.
Equity compensation is the other big topic. ISOs, NSOs and RSUs bring timing choices, alternative minimum tax issues and sometimes a Section 83(b) decision for founders. The rules for stock options are federal, but moving to or from Texas, or exercising while living elsewhere, can add state questions. Our equity planning and management work helps founders and employees plan before they exercise or sell.
Property tax around Austin
Travis and Williamson County homeowners can use the same Texas exemptions as everyone in the state. School districts must give a $140,000 residence homestead exemption and an extra $60,000 for owners who are 65 or older or disabled, and local units may add more. Our job is to help you read your notice and find missing exemptions, not to promise a lower value.
The community
The Austin metro area has about 79,000 residents who identify as Asian Indian alone or in combination (roughly 3.2%), and Williamson County, which includes Round Rock and Cedar Park, is about 5.4% (American Community Survey, 2020 to 2024). If you hold H-1B or green-card status, see our pages for H-1B and visa holders and for IT consultants and tech professionals.
How we can help
We prepare federal and multi-state individual returns, handle business returns and Texas franchise reports, and set up payroll for startups. Talk with a qualified professional about your own equity or residency situation.
Frequently asked questions
Does working from home in Austin make my income free of other states' tax?
Not automatically. Texas has no income tax, but your employer's state may still tax some wages under its own rules, so review it before you file.
Is my startup exempt from the Texas franchise tax?
A company at or below the no-tax-due threshold owes no tax but usually still files a report. Check the Comptroller's requirements for your entity.
Do I owe sales tax if I sell software from Austin?
It depends on what you sell and to whom. Texas taxes certain services and some software, so confirm before you start collecting or skipping tax.
What else does a new Austin company have to file?
Federal and state returns, plus payroll filings and Texas unemployment tax registration once you have employees.
Official sources
- Texas Comptroller: franchise tax
- Texas Comptroller: property tax exemptions
- Texas Comptroller: local sales tax rates by city
- New York State: filing requirements, residency and telecommuting FAQ
- U.S. Census Bureau: ACS 2020-2024 5-year, Table B02018 (Austin metro area and Williamson County)
This page is a plain-language summary. The official source controls if there is any difference.
General information only, not tax, legal or accounting advice for your situation. Rules, limits and deadlines change; confirm the current rules with the official source or a qualified professional before you act. Reading this page does not create a professional relationship with CPA Tax Payroll and Accounting Corp.