QSBS Exclusion (Section 1202) in Texas 2026
Calculate your qsbs exclusion (section 1202) tax savings in Texas. Texas has no state income tax, so savings come from the federal level.
Texas Tax Overview
No income tax (constitutionally prohibited). Second-highest property taxes (1.68%). High sales tax.
QSBS Exclusion (Section 1202) Savings Calculator for Texas
Federal Savings
$1,100
22% bracket
Texas State
$0
0% rate
Total Savings
$1,100
22.0% combined
At a 22.0% combined tax rate in Texas, every $1,000 in deductions saves you $220 in taxes.
Savings by Tax Bracket in Texas
Texas has no state income tax — savings are from federal taxes only.
Eligibility Requirements
Investors in qualified small business stock
- 1C-corp with <$50M assets
- 2Held 5+ years
- 3100% exclusion up to $10M
Common Mistakes to Avoid
- !Not meeting C-corp requirement
- !Selling before 5 years
Texas Filing Tips
No income tax saves significantly. High property taxes offset for homeowners. Texas offers homestead exemption and property tax freeze for 65+. Protest assessments annually.
Required Tax Forms
File these forms with your federal tax return to claim the qsbs exclusion (section 1202).
Other Tax Deductions in Texas
Capital Loss Deduction
Investment
Tax-Loss Harvesting
Investment
Investment Interest Expense
Investment
Qualified Dividend Tax Rate
Investment
Opportunity Zone Investment
Investment
1031 Like-Kind Exchange
Investment
Installment Sale
Investment
NIIT Planning (3.8% Surtax)
Investment
QSBS Exclusion (Section 1202) in Neighboring States
Tax Calculators for Texas Cities
Calculate Your Full Tax Savings in Texas
Use our free tax calculators to optimize your entire tax return for Texas.
Frequently Asked Questions
How much can I save with the QSBS Exclusion (Section 1202) in Texas?
In Texas, the qsbs exclusion (section 1202) can save you an estimated $1,100 per year on a $5,000 deduction. This includes $1,100 in federal tax savings. The national average savings is $100,000/year.
What is the Texas state income tax rate?
Texas has no state income tax, which means the qsbs exclusion (section 1202) only provides federal tax savings for Texas residents. No income tax (constitutionally prohibited). Second-highest property taxes (1.68%). High sales tax.
Who qualifies for the QSBS Exclusion (Section 1202) in Texas?
Investors in qualified small business stock. The eligibility requirements are the same whether you live in Texas or another state, as this is a federal tax deduction. However, your total savings will vary based on Texas's lack of state income tax.
What tax forms do I need to claim the QSBS Exclusion (Section 1202) in Texas?
To claim the qsbs exclusion (section 1202), you need to file Form 8949 and Schedule D with your federal return. Filing status affects your deduction limits and tax bracket.
Is the QSBS Exclusion (Section 1202) better in Texas than in states without income tax?
Since Texas has no state income tax, the qsbs exclusion (section 1202) only reduces your federal tax bill. Residents in states with income tax get additional state-level savings. However, Texas residents often benefit from lower overall tax burden.
What is the standard deduction in Texas for 2026?
Texas has no state income tax, so there is no state standard deduction. The federal standard deduction for 2026 is $14,600 for single filers and $29,200 for married filing jointly.
Related Calculators
Capital Loss Deduction in Texas
Avg savings: $660/year
Tax-Loss Harvesting in Texas
Avg savings: $5,000/year
Investment Interest Expense in Texas
Avg savings: $1,500/year
Qualified Dividend Tax Rate in Texas
Avg savings: $3,000/year
Opportunity Zone Investment in Texas
Avg savings: $10,000/year
1031 Like-Kind Exchange in Texas
Avg savings: $30,000/year