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It’s the time of year when the topic of property taxes remains fresh in the minds of Houston homeowners. This is because our property taxes are typically paid in a single annual payment due on or before January 31st. As we launch into a new tax year, and with the recent tax year’s payment completed, you may have some questions around property taxes and how these are determined, if there are exemptions, or even how to dispute the taxes. Keep reading for some answers.
Property taxes are calculated by multiplying the Assessed Value of the property (subtracting any applicable Homestead, Age 65+ and Disability exemption amounts) by the Mil Rates levied by the taxing authorities that have jurisdiction where the property is located. The calculating formula looks like this:
(Assessed Value minus Homestead/Age 65+/Disability Exemption) x Mil Rates = Property Taxes
Texas state law defines the assessed value of real property as the Market Value of a property on January 1, the first day of the tax year. If you’re interested, official property tax exemption information can be found at State of Texas Comptroller property tax exemptions.
Yes. In my blog post, How To Appeal Your Property Tax Assessment, you’ll find information outlining how to start an appeal process.
In summary, it’s possible to trim your property tax bill by appealing the value the tax assessor has assigned to your home if the value is inaccurate. This begins with having a conversation with your real estate agent and asking for some help with determining your home’s value. Your agent can do a bit of research, comparing your home to similar homes in your community, to determine if your home is worth less than the value assessed. If the agent determines it’s less, you can appeal the property tax assessment and save on the amount owed.
Texas Homestead Property Exemption: When it comes to Homestead Exemptions and your property taxes you may have questions and want to learn more. You’ll find the answers you need in my blog post, Understanding a Texas Homestead Property Exemption & How To File.
The Texas Comptroller’s website explains there are several types of exemptions a homeowner may be eligible to receive:
School taxes: All residence homestead owners are allowed a $40,000 residence homestead exemption from their home's value for school taxes.
County taxes: If a county collects a special tax for farm-to-market roads or flood control, a residence homestead is allowed to receive a $3,000 exemption for this tax. If the county grants an optional exemption for homeowners age 65 or older or disabled, the owners will receive only the local-option exemption.
Age 65 or older and disabled exemptions: Individuals age 65 or older or disabled residence homestead owners qualify for a $10,000 residence homestead exemption for school taxes, in addition to the $40,000 exemption for all homeowners. If the owner qualifies for both the $10,000 exemption for age 65 or older homeowners and the $10,000 exemption for disabled homeowners, the owner must choose one or the other for school taxes. The owner cannot receive both exemptions.
Optional percentage exemptions: Any taxing unit, including a city, county, school, or special district, may offer an exemption of up to 20 percent of a home's value. But no matter what the percentage is, the amount of an optional exemption cannot be less than $5,000. Each taxing unit decides if it will offer the exemption and at what percentage. This percentage exemption is added to any other home exemption for which an owner qualifies. The taxing unit must decide before July 1 of the tax year to offer this exemption.
Optional age 65 or older or disabled exemptions: Any taxing unit may offer an additional exemption amount of at least $3,000 for taxpayers age 65 or older and/or disabled.
The Assessed Value is the dollar value assigned to a home or other property for tax purposes. This amount is often lower than the Market Value.
The Market Value is the dollar amount the property could sell for. This amount is based on comparable recently sold properties and is based on average.
Here’s what you need to know about Texas Proposition 4, the Property Tax Changes and State Education Funding Amendment:
The “yes” ballot supported amending the state constitution to:
Disclaimer: This content is not intended as financial/tax advice. Use this topic to start a conversation with your financial/tax advisor.
Since 2004 Sara Lyn Nguyen continues to bring a wealth of knowledge and expertise about buying and selling real estate around the Houston area to those she serves. Sara is a multi-year award winning REALTOR® and relocation specialist where her clients trust her to have up-to-date information on the real estate market. She has been one of Gary Greene’s Multi-Million Dollar Top Producers, and citywide was the #2 Top Producing agent in 2020, #3 in 2021, and #2 in 2022. When it’s time to buy, sell, invest, or relocate speak with a trusted professional knowledgeable in the homes and neighborhoods of Fort Bend/Sugar Land and the surrounding region.
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