Texas property tax law changes every few years. See the latest posts for the most up-to-date information.
With the cost of everything on the rise, it’s important to recognize that you’re likely paying more in property taxes than you should. And in a state like Texas, which has one of the highest property tax rates in the country, if you don’t take advantage of the multiple avenues to reduce your property tax bill, owning property can feel like a burden.
In this post, we will take you through the avenues you can take advantage of to reduce your property tax bill. But first, you need to understand how your tax bill is calculated.
How Is the Tax Bill Calculated?
If you feel that you are paying too much in taxes, the first step is to determine how much you should pay, which is only possible if you understand how to calculate property taxes. It can be challenging because most counties have their own way of calculating property taxes.
When calculating your tax bill, the two important figures are the tax rate and your property’s value. Property tax rates in Texas are recalculated every year after appraisers have appraised all the property in the county. The rate depends on the total property value and how much revenue they need to fund local services. However, these rates don’t change much from year to year.
The tax office multiplies your property value with the tax rate to come up with your tax bill. For instance, if you have property worth $100,000, and the tax rate is 5%, your tax bill is $5,000.
How Can You Lower Your Property Tax Bill in Texas?
Property owners in Texas have two options to reduce their property tax bills. The first is taking advantage of property tax exemptions available to Texas residents, and the second is to contest the property’s appraised value.
Using Exemptions
Using exemptions is the easiest and most reliable way to lower your burden.
Most Texans qualify for one or more exemptions based on certain requirements. These requirements differ from county to county and can be found in Chapter 11 of the Texas Tax Code. Here is a breakdown of the exemptions available to Texas residents to help you understand which you qualify for and which you don’t.
Related: What You Need to Know About Your Texas Property Tax Protest
Basic Homestead Exemption
School districts must offer a $40,000 basic homestead exemption on residences in 2022. The counties also have to offer an additional exemption of up to 20% of the property’s appraised value, but not less than $5,000. However, the property has to be the owner’s primary residence. The Texas tax code contains more information.
If you qualify for the homestead exemption, you can apply any time. Download the homestead exemption form to apply.
Senior Citizens and Disabled People Exemption
If you are 65 years and above or are disabled, you are entitled to a $10,000 exemption from property taxes in Texas. Some counties have additional exemptions for these parties. For more information, check out the Texas tax code.
Download the disability exemption form or the senior citizen exemption form to apply.
Disabled Veterans’ Exemption
The amount of exemption for disabled veterans depends on their disability rating and age. The highest exemption is $12,000, which applies to veterans with a disability rating of 70%, 65 or older with a disability rating of 10% and above, have lost one or two limbs, or are blind in one or both eyes. The Texas tax code has more information.
Download the exemption form to apply.
Veteran’s Surviving Spouse Exemption
As long as a veteran’s surviving spouse has not remarried, they are entitled to the same exemption that the veteran received at the time of death. It is also available for the veteran’s children.
Once you have filled out the application form, you must submit it to your county appraisal district. It is free and only needs to be done once.
Protesting the Property’s Appraised Value
Once you’ve made sure you’re taking advantage of all possible exemptions you’re eligible for, you may notice your tax bill is still too high. This could be because the appraised value of your property is higher than its actual value.
Appraisers have hundreds or thousands of properties to appraise every year, so they can’t do it physically visit every property. That is why they rely on computer-generated facts and figures to conduct mass appraisals, which are, by their nature, unlikely to be 100% accurate.
And even if they appraise physically, some of these assessors don’t have all the information needed for an accurate appraisal, which could lead to a wrong appraisal value.
So, if you feel like you are paying too much in taxes, it could be because the assessor or the computer program misjudged the value of your property, leading to a taxable value that is higher than it should be. This can be resolved through appealing or protesting the appraisal, which you have the right to do.
But before we look into how you can protest the appraisal; how do you check whether your property has been evaluated accurately?
Check Your Property Tax Card
Not many property owners realize they can just head to the town hall and request a copy of their property tax cards.
A property tax card contains all the information about your property that the district has gathered over time. Some of the details it contains include:
- Its precise dimensions.
- Fixtures within the property.
- The size of the lot.
- Notes about any improvements made to the structure.
If they don’t have the tax card, you can ask the appraiser for the data they used to value your property.
Check all the details carefully, and if you notice any discrepancies or mistakes that raise the value of your property, you’ll want to initiate a property tax protest with the County Appraisal District (CAD). They are obligated to correct them or conduct a reassessment to lower the value.
Research Similar Property in the Area
Look for similar properties in the area your property is located. Assemble a list of the properties alongside their assessed values. The county appraisal district maintains these records.
If there are any differences between the properties, such as age, size, improvements, and land size, make adjustments. But it’s best if you use comparable properties that don’t require many adjustments. If, after evaluating, you conclude that your property is overvalued, you can appeal.
Consider the Inside of Your Property
Appraisers rarely go inside the house for assessment, and the outside of the house doesn’t really represent the inside. If your house has a lot of problems or outdated features that need money to fix or replace, they could devalue your home.
Take pictures of these issues, such as cracked walls, electrical and plumbing problems, and the roof or foundation that needs repair. Get estimates of the amount it would take to fix these issues and document them before appealing.
Related: Are you looking for professional help to protest your Texas property taxes?
How to Protest the Appraised Property Value
Once you have a good idea of the situation for your particular home, it’s time to begin the protest.
To avoid the various processes such as collecting evidence and presenting it physically to your county’s appraisal district, the first step is checking whether your county allows automated protests. If it does, you only need to create an account, log in to the appraisal district website, and enter your proposed value.
In response to your request, the appraisal district gives you an offer, which you can accept if you are satisfied. If you aren’t, the next step is to move to an informal protest.
Before starting the informal protest, you need to collect as much evidence as possible that shows the current value is overstated. Such evidence includes pictures and documents, and other records.
It is easy to miss a detail or two or not know what to look for, and that is why many homeowners choose to work with professional property tax services to do this work for them and represent them at the hearing. Property tax services will handle these requirements and processes, saving you time and effort.
When you collect all the evidence, the next step is to meet an appraiser in the appraisal district office.
If you are not happy with the outcome of the informal hearing, you can move forward to a formal protest. If you don’t have a formal protest application form, you can request it at the appraisal office.
Fill out the form, or have your property tax protest service do it for you, then submit it to begin the formal protest process. Most counties will notify you of the formal protest date 15 days in advance. The formal protest involves meeting with a review board, where you will present the facts about why you believe your property is overvalued to the appraisal district representatives.
The representatives review it and present their side. The panel then discusses the information from both parties and decides the property’s value.
If you are still not satisfied with the outcome, you don’t have to accept the offer. Instead, you can appeal their decision.
Need Help Lowering your Taxes? Consider Property Tax Protest Services
If you feel that your tax bill is too high even after using all the exemptions you qualify for, the only way to lower it is to protest the appraised value of your property.
But the whole process is a lot of work, and since it is unchartered territory for most property owners, many choose to work with property tax experts who know the ins and outs of property tax laws. Also, since you can do it yearly to keep your taxes as low as possible, a property tax protest company can ensure the process is timely, streamlined, and effective.
Home Tax Shield can take the burden of protesting your property tax bill off your shoulders. We’ll walk through the entire process for you, and with our AI-powered technology, we’ll make sure your taxes are accurate and fair year after year.
Sign up today and let us handle the rest.