The State Fare of Taxes
Courtney Leffall, CFP®
Living in McKinney, Texas, is like attending to The State Fair of Texas—there’s plenty to do, but we must pay a “fare” before we can enter the fair grounds and enjoy all of the festivities. That “fare” is taxes—the hidden cost of calling this thriving Collin County city home. From city, county, and school taxes to sales tax, HOA fees, and lesser-known MUD and PID assessments, our tax mix in McKinney is as varied as the fair’s food stalls. Understanding what we pay (and why) keeps our finances steady in a city on the rise.
Our Texas Taxes: The McKinney Menu
We Texans often highlight our lack of a state income tax, but we still face a robust lineup of other levies. Here’s what we’re paying:
- City Taxes: We pay $0.4155 per $100 of assessed value—about $1,454 a year for a $350,000 home. This funds our streets and Downtown’s upkeep.
- County Taxes: Collin County adds $0.149 per $100, or $522 on that same home, covering courts, roads, and county services.
- School Taxes: McKinney ISD’s rate is $1.259 per $100 (post-2023 relief), totaling $4,407 annually for our $350,000 example. Education remains a priority.
- Sales Tax: When we shop at District 121 or dine near Tupps Brewery, we encounter an 8.25% rate—6.25% state, plus 2% local (1% city, 1% county). A $500 weekend spend means $41.25 in tax.
- MUD Taxes (Municipal Utility Districts): In newer areas like Trinity Falls, MUDs fund water, sewer, and drainage—rates of $1.00-$1.40 per $100, or $3,500-$4,900 a year on a $350,000 home. These decrease as bonds are paid.
- PID Taxes (Public Improvement Districts): In places like Craig Ranch, PIDs add $0.15-$0.50 per $100 ($525-$1,750 annually) for parks and sidewalks, lasting 20-40 years.
- HOA Fees: Not a tax, but a recurring cost. In Stonebridge Ranch, we pay $500-$2,000 a year for pools and trails—required in HOA zones.
Our Recent Tax Relief in McKinney
We’ve seen some tax relief lately. In September 2024, our McKinney City Council lowered the property tax rate to $0.415513 per $100 valuation for FY 2024-25—down over $0.01 from $0.427513 the prior year. It’s our lowest rate in years, cutting about $42 off the city portion of a $350,000 home’s bill. Combined with our 2023 Proposition 4 relief—raising homestead exemptions to $100,000 for school taxes and reducing school rates—we could save $500 or more overall. McKinney ISD also dropped its rate by 6.3 cents in 2022-23 with federal ESSER funds, part of a 35.7-cent decline over seven years. Rising home values (up 6-8% in Collin County from 2023-2024) offset some of this, though.
Our State of Taxes in 2025
Taxes remain a key issue as our McKinney population exceeds 214,000. Our Proposition 4 relief continues into 2025, but higher home values erode some savings. Our sales tax is strong—statewide, we collected $41 billion in 2024—driven by McKinney’s retail growth along U.S. 380 and Highway 5. MUD and PID taxes expand with new developments like Trinity Falls (MUD) and Tucker Hill (PID), while HOA fees in Stonebridge Ranch climb toward $2,000+ as amenities improve.
Why It Matters: Taxes Are Our Lifelong Commitment
Our McKinney tax tally adds up. That $350,000 home might face $6,383 in base property taxes (city, county, school), $2,000 in sales tax, $3,500-$4,900 in MUD (if applicable), $525-$1,750 in PID (ditto), and $1,000 in HOA fees. Total? $10,000-$15,000 a year before federal taxes. Over 30 years, that’s $300,000-$450,000—a major lifetime expense. Smart planning helps us: retirement accounts reduce federal taxes, homestead exemptions lower property bills, and MUD/PID costs may be deductible if we itemize. We assess HOA benefits versus costs and plan purchases for tax-free weekends.
Plan Smart, Save More
Our tax mix varies, so we recommend consulting a local CPA or tax advisor, we have several we can recommend. They’ll customize a plan for our McKinney lifestyle—whether we’re in Trinity Falls’ MUD zone or near Downtown’s revitalized East Side. Need an advisor? We can connect you with experts who understand our Texas taxes thoroughly. At lxparker.com, we’re here to navigate our state fare of taxes—city, county, school, sales, MUD, PID, HOA, and beyond. Ready to stabilize our finances in McKinney? Schedule and appointment to meet me at our office at 300 East Davis Street, Suite 112 McKinney, TX 75069.
Disclosures:
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Investing involves risk including loss of principal. No strategy assures success or protects against loss.
