Louisiana taxes its residents on worldwide income, regardless of where it is earned. Your state of residence determines your tax obligation, not your state of employment. Working in Texas (or any no-income-tax state) does not create an exemption from your home state's tax. Louisiana's graduated brackets apply to all your earned income.
| Tax layer | Owed? | Details |
|---|---|---|
| Federal income tax | Yes | IRS Form 1040 |
| Texas income tax | No | TX has no income tax |
| Louisiana income tax | Yes (all income) | LA Form IT-540 (resident) |
How do I handle withholding with my Texas employer?
Texas employers have no state income tax withholding system. Your employer will not withhold any state tax from your paycheck. This means you need to handle Louisiana tax payments yourself:
- Make quarterly estimated payments to Louisiana using Form IT-540ES throughout the year.
- File LA Form IT-540 at year-end, reporting all income including Texas wages.
- Pay any remaining balance or claim a refund if you overpaid through estimates.
Failing to make estimated payments can result in underpayment penalties from Louisiana. Budget for this — without automatic withholding, it is easy to fall behind.
(Current LA brackets at revenue.louisiana.gov.)
Is it worth moving to Texas to avoid Louisiana income tax?
If you genuinely move your domicile to Texas, you become a Texas resident and owe no state income tax on any income (since TX has none). But the move must be real — Louisiana can audit your residency claim. Maintain Texas domicile documentation: TX driver's license, voter registration, primary home in TX. Louisiana may argue you are still a LA resident if you maintain significant ties to the state.
Does Louisiana give a credit for taxes paid to Texas?
No, because Texas charges zero income tax. Louisiana's credit for taxes paid to other states only applies when you actually pay tax to another state. Since TX takes nothing, there is nothing to credit. Your full Louisiana tax obligation stands.
What about remote work — does working from home in LA for a TX employer change anything?
No. Whether you commute to Texas or work remotely from Louisiana, the result is the same: you owe Louisiana income tax on all your wages. The location of work does not matter because Louisiana taxes residents on worldwide income regardless. Remote work from Louisiana for a Texas employer has no tax advantage — it simply means TX continues to not withhold, and you continue to owe LA.
Compare take-home estimates using the TX salary calculator and LA salary calculator. For other cross-border arrangements, see the reciprocity hub.
What about other no-income-tax states — is this the same pattern?
Yes. The TX-LA arrangement follows the same pattern as any situation where a state with income tax borders a state without it. Similar pairings include:
- Florida: FL residents working in GA or AL follow the reverse — they pay the work state's nonresident tax. (FL has no income tax.)
- Nevada: NV residents working in California pay CA nonresident tax.
- Washington: WA residents working in Oregon pay OR nonresident tax.
In all cases, the no-income-tax state provides zero offset, so you pay the taxing state's full rate with no credit.
What if I moved from Louisiana to Texas mid-year?
File Louisiana Form IT-540 as a part-year resident. Louisiana taxes all income during your LA residency period. After you become a Texas resident, Louisiana taxes only LA-source income (if any) as a nonresident. If you continue working in Texas, those wages are not LA-source, so they drop off Louisiana's return entirely. Texas has no return to file.
The key advantage of moving: after establishing TX residency, non-LA income (investments, savings, TX wages) is completely untaxed at the state level. But the move must be genuine — maintain TX domicile documentation (TX driver's license, voter registration, primary home).
What about Louisiana's local taxes — do parishes levy income taxes?
Louisiana does not have a widespread local income tax system like Ohio or Kentucky. Louisiana parishes do not levy their own income tax on wages. Your Louisiana obligation is solely the state income tax. This makes the TX-LA crossing cleaner from a local-tax perspective than many other border crossings.
For take-home estimates, use the TX salary calculator and LA salary calculator. For the complete list of state-pair guides, visit the reciprocity hub.
Questions
Frequently asked questions
Why do I still owe Louisiana tax if Texas has no income tax?
Louisiana taxes its residents on worldwide income, regardless of where it is earned. Your state of residence determines your tax obligation, not your state of employment. Working in Texas (or any no-income-tax state) does not create an exemption from your home state's tax. Louisiana's graduated brackets apply to all your earned income.
How do I handle withholding with my Texas employer?
Texas employers have no state income tax withholding system. Your employer will not withhold any state tax from your paycheck. This means you need to handle Louisiana tax payments yourself:
Is it worth moving to Texas to avoid Louisiana income tax?
If you genuinely move your domicile to Texas, you become a Texas resident and owe no state income tax on any income (since TX has none). But the move must be real — Louisiana can audit your residency claim. Maintain Texas domicile documentation: TX driver's license, voter registration, primary home in TX. Louisiana may argue you are still a LA resident if you maintain significant ties to the state.
Does Louisiana give a credit for taxes paid to Texas?
No, because Texas charges zero income tax. Louisiana's credit for taxes paid to other states only applies when you actually pay tax to another state. Since TX takes nothing, there is nothing to credit. Your full Louisiana tax obligation stands.
What about remote work — does working from home in LA for a TX employer change anything?
No. Whether you commute to Texas or work remotely from Louisiana, the result is the same: you owe Louisiana income tax on all your wages. The location of work does not matter because Louisiana taxes residents on worldwide income regardless. Remote work from Louisiana for a Texas employer has no tax advantage — it simply means TX continues to not withhold, and you continue to owe LA.
- 🔄 Last updated July 31, 2026 · Tax year 2026
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