Property Tax in Texas
Property tax in Texas is a locally assessed and is a locally administered tax. There are no state property taxes. Property tax brings in the most money of all taxes available to local government to pay for schools, roads, police and firemen, emergency response services, libraries, parks, and other services provided by the local government.
Texas offers a variety of partial or total (absolute) exemptions from appraised property values used to determine local property taxes. A partial exemption removes a percentage or a fixed dollar amount of a property’s value from taxation. A total (absolute) exemption excludes the entire property from taxation. Taxing units are mandated by the state to offer certain (mandatory) exemptions and have the option to decide locally on whether or not to offer others (local option).
One tax exemption you can apply for is the Residential Homestead Exemption and it will save you money every year in property taxes.
What is a Homestead?
- A homestead can be a separate structure, condominium or a manufactured home located on owned or leased land, as long as the individual living in the home owns it.
- A homestead can include up to 20 acres if the land is owned by the homeowner and used as a yard or for another purpose related to the residential use of the homestead.
How do homeowners get a tax break from property taxes?
Homeowners may apply for homestead exemptions on their principal residence. Homestead exemptions remove part of the home’s value from taxation, so they lower taxes.
For example, your home is appraised at $100,000, and you qualify for a $25,000 exemption (this is the amount mandated for school districts), you will pay school taxes on the home as if it was worth only $75,000. Taxing units also have the option to offer a separate exemption of up to 20 percent of the total value.
Do all homes qualify for homestead exemptions?
No, only a homeowner’s principal residence qualifies.
To qualify, a home must meet the definition of a residence homestead: The home’s owner must be an individual (for example, not a corporation or other business entity) and use the home as his or her principal residence on January 1 of the tax year. If you are age 65 or older, the January 1 ownership and residency are not required for the age 65 homestead exemption.
What homestead exemptions are available?
There are several types of exemptions you may receive.
- All Texas homeowners may receive a General Residence Homestead Exemption of $25,000 on the value of their property for school taxes. Other taxing entities may also offer exemptions of some percentage of the home’s value.
- County taxes: If a county collects a special tax for farm-to-market roads or flood control, a residence homestead owner may 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 65 and older and/or disabled residence homestead owners may qualify for a $10,000 homestead exemption for school taxes, in addition to the $25,000 exemption for all homeowners. If the owner qualifies for both the $10,000 exemption for 65 and 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.
Exemptions from property tax require applications in most circumstances. Applications for property tax exemptions are filed with appraisal districts.
WHEN SHOULD I FILE THE APPLICATION?
- You should file your regular residential homestead exemption application between January 1 and April 30. Early applications will not be accepted.
- If your application is postmarked by April 30, this will allow the district time to process it before your tax statement comes out in the fall.
If you want to receive a homestead exemption for the taxes on your home, the home must first qualify as a residence homestead on January 1 of the year in which you are applying. There are two requirements:
- You must own your home on January 1.
- If you are over 65, and/or disabled the January 1 ownership and residency are not required.
- You must use the home as your principal residence on January
It’s vital that home buyers update their address on their driver’s license, and with the tax assessor/collector in their area in order to be able to provide the required documentation for the homestead exemption.
WHAT YOU WILL NEED:
- Completed Application For Residential Homestead Exemption
- Copy of DRIVER’S LICENSE or IDENTIFICATION CARD from the Texas Department of Public Safety at www.txdps.state.tx.us
- The address MUST MATCH the homestead address.
- Property information (deed information such as legal description, court record/filing number).
INFORMATION ABOUT NEW BRAUNFELS HOMESTEAD & PROPERTY TAXES
Comal ISD grants residents an additional 20 percent homestead exemption on top of the normal $25,000 homestead exemption granted by the state. https://www.comalisd.org/apps/pages/welcome
By law, the district must set a minimum debt service tax rate to cover its debt obligation for that fiscal year. Tax Code exemption requirements are extensive. Property owners should read applicable statutes carefully.
New Braunfels ISD
On June 24, 2019, the Board held a public hearing to discuss the proposed tax rate of $1.30580 per $100 property valuation for the 2019 tax year. The proposed tax rate includes $0.97 for Maintenance and Operation (M&O) and $0.3358 for Interest and Sinking (I&S) that goes towards paying the bond debt.
An NBISD homeowner will pay an average of $3,069.50 in annual taxes on a home valued at $264,301 – the average market value of residences in NBISD. This equates to an average increase of $85.94 a year. The official order adopting the tax rate will be voted on during the August 19th Board meeting. https://www.nbisd.org/page/article/1058
If you would like any assistance in filling out your Homestead Exemption Application, I’d be happy to help! Call me today (830) 583-7029
**Information in this article is for general educational purposes only and is not offered as legal advice upon which anyone may rely. Please contact your local appraisal district to verify the information contained in this blog post.