Texas property taxes haven’t just been top of mind for homeowners statewide because of May’s protest deadline. They’ve also been featured regularly in local news stories, political analyses, and speeches throughout the House and Senate. Both Congress bodies are focused on separate plans for dividing the $12.3 billion that the state has allocated for property tax relief, with one goal prioritizing more significant exemptions for homeowners and the other providing a tight cap on property tax increases.
While this conversation won’t impact individual homeowners’ steps to protest and pay their property taxes, it will drastically affect the numbers your local tax appraisal district records in its appraisal district roll or the history of taxable property values within its jurisdiction.
Read on to learn more about the appraisal district roll, how tax appraisal districts arrive at each property’s valuation, and some common myths and misconceptions about the entire process. After you read this, you’ll have more precise insight into property tax mechanics on a district-wide level so you can follow developing news and fight for fair property taxes.
What Is the Appraisal District Roll?
Tax appraisal districts must create and certify an appraisal district roll each year, whether on the city or county level. This record functions as a list of all the applicable taxable property within the local district’s jurisdiction. It also records the property’s value for taxation purposes, and this number may go through several revisions before the final number is recorded on the official appraisal district roll. Once the record is finished, the district’s chief appraiser affirms and certifies the roll. (The Schulenburg, Texas, 2021 certification document looked like this.) It then goes to the local tax assessor’s office, which will begin calculating property tax bills based on the certified property values.
What Do the Values Mean, and How Are They Determined?
The property value recorded in the appraisal district roll is the number from which your tax obligations are calculated, so the number must be accurate. Not only do cities and counties need the funds corresponding to each property’s value (and any increase in value over the past year), but property owners need that number to be as small and reasonable as possible so they aren’t paying more than their fair share in taxes. So, how do appraisal districts get those numbers?
The chief appraiser—or professional representatives of the appraisal district under them—must appraise every taxable property within their jurisdiction at least once every three years. In the intervening years, officials may calculate increases in property values by considering increases in neighboring properties, changes in the neighborhood or levels of demand, the property’s age, and other factors. This process tries to carefully counterbalance efficiency (by not appraising every property yearly) and accuracy (but not overgeneralizing data). However, sometimes the values are inaccurate, and property owners can protest the value they receive notice of in the spring. While this process is colloquially referred to as “protesting property taxes,” it means protesting the property value taxes will be based on.
A Quick Recap
Property tax assessments and calculations are complex processes with many moving parts and different entities. Here’s a quick recap:
- Your local appraisal district appraises properties within their jurisdiction to calculate property values for the current tax year.
- Those numbers may be protested by individual property owners and adjusted. The final values are then entered into the appraisal district roll.
- That record then moves to the corresponding county tax office. Your actual property tax bill is calculated based on the value, tax rates in your area, and any applicable exemptions.
If you want to protest your tax obligations and ensure your bill isn’t unfairly high, that takes place before the appraisal district roll is certified—before property tax calculations start.
Related: The Future of Property Tax Relief Laws in Texas
5 Common Myths and Misunderstandings About Appraisal District Roll Values
Because the process of managing and completing appraisal district rolls doesn’t directly involve taxpayers or property owners, the process can feel very opaque, and there are a lot of myths and misconceptions about the roll values and the district’s method of determining them. Whether you want to pay fair taxes for the current tax year or simply want to ensure you understand the process better, here are five common misunderstandings you may encounter.
1. Your Home’s Value on the Appraisal District Roll Is the Market Value
‘Property value,’ ‘appraised value,’ and ‘home value’ are often used interchangeably in discussions about property taxes and buying or selling a home. That can get confusing quickly. There are two main types of ‘home value’ that property owners and prospective buyers will want to keep an eye on:
- Property values to calculate property taxes: This is the number determined by your local appraisal district. While it is loosely based on market value, the value is also affected by historical records, if you have a homestead exemption (which caps increases on the assessed taxable property value each year), and other factors.
- Property values on the market: This is the amount of money a home will get purchased for on the market. Not only is it based on the area and the features of the house itself, but it’s also based on primary market factors, emotions, and the negotiations between a buyer and seller. The taxable property value has next to no impact on this value.
This can confuse many people, as it sounds like a lowered property tax value may reduce your home’s selling price on the market – but this isn’t the case. While buyers may look up your tax history, it’s only useful as a tool for determining their potential tax bills in the future—not for negotiating down the sales price.
2. That Your Appraisal District Roll Value—And Your Taxes—Will Always Go Up
Especially in today’s market, many people are concerned that property taxes and home values will continue to skyrocket. They worry about being priced out of their homes and, especially for older homeowners, paying a property tax rate that outstrips their mortgage payments and fixed budgets.
But the value of a property on the appraisal district roll won’t always go up. Your property value could hold steady if there are no new developments in the area. It may even fall if there’s a decrease in demand—especially as the market starts to return to normal after the surge throughout the pandemic.
Also, your property tax will not necessarily increase with your property value. If your city or county has yet to approve a budget increase or there’s less planned spending, you may see your property tax rate fall, resulting in a lower total bill. Additionally, becoming eligible for certain exemptions can lower your effective property tax rate and the bill.
Related: 7 Key Things You Should Know About Homeowner Taxes in Texas
3. It’s Not Worth Hiring Help From Property Tax Professionals
Protesting property taxes can be extremely challenging, tedious, and time-consuming. This means many homeowners simply accept the value they see on their Notice of Appraised Value, as they don’t think they’ll get a reduction worth the amount of time and effort required. Many people also don’t consider having a property tax service manage the protest process very valuable.
However, choosing the right service provider can ensure the process is handled correctly and requires minimal work from the property owner. By selecting a company with high ratings and one that receives a percentage of your savings (rather than simply a hefty flat fee), you can find services that result in savings opportunities.
4. Protesting Your Property Taxes Hurts Your Home Value
This is an often believed corollary to the confusion between property values for tax calculations and property values for market purposes. Many homeowners are concerned that protesting hurts their property’s value. After all, some of the documentation you may use to counter the tax appraiser’s number includes:
- The (lower) property values of similar homes in your neighborhood
- Factors that negatively impact the sellability of your home
- Elements of disrepair or outdated features in your home
However, this evidence won’t become a black mark on your home’s record. It simply justifies lowering your property taxes. In fact, it can make it more attractive to buyers.
5. You Should Protest Your Property Tax Bill, Not the Appraised Value
A common misconception is tied to the protest process itself. While it’s called ‘protesting your property taxes,’ that’s only true to a degree. You won’t be protesting your property tax bill, which comes out in the fall—at that point, it’s too late to make adjustments for the current tax year. Instead, property owners protest in the spring when the appraised property values come out. Countering and opposing at this stage—before the numbers are set in stone in the appraisal district roll—is essential.
Home Tax Shield Is Here to Help You Fight for Fair Property Values and Property Taxes
Knowing the broad tax valuation and assessment process can make the yearly cycle a little more straightforward but doesn’t make protesting your property taxes any easier. If you’d like help fighting for fair property taxes, the team at Home Tax Shield is here to help. Our professional property tax experts can assess your home’s value, determine if your county’s numbers are inaccurate, and then manage the protest process so you get the fairest possible property value entered into the appraisal district roll. Sign up today to get started.