While property taxes in Texas are managed on the local level by county appraisers and tax assessors, they are guided by laws set at the state level. So even though property tax rates in the suburbs of Houston may be significantly different from those in the suburbs of Dallas, they all must adhere to the same core laws, deadlines, and opportunities for homeowners to reduce their property tax obligations.
Last year, Texas legislators approved multiple changes to the property tax code, and voters approved those changes in November. The result presents significant savings opportunities to qualifying homeowners.
Staying on top of property tax processes can help you apply exemptions to your home and lower your property tax bill every year. With a broad understanding of the impact legislation has on your property taxes, as well as the specific mechanisms changed last year, you can more confidently protest your property taxes and stay ready for money-saving opportunities.
A General Overview: How Legislation and Policy Changes Affect Your Property Taxes
When thinking about skyrocketing property tax bills, there’s often one primary cause: rising property values. Especially over the last couple of years, major Texas cities and their suburbs have seen a rapid rise in demand. Rural areas between big cities are also developing, causing property values to climb higher and higher.
However, this isn’t the only reason why property taxes change over the years. Instead, there are two major policy reasons why your property taxes may go up or down:
- The state government approves changes to the tax code. This has happened several times throughout the last few decades, especially regarding homestead exemption amounts. Another relatively recent law change set a ceiling on how much cities can increase property tax revenue collection to meet budget demands.
- Local budgets. Cities and counties can approve higher or lower tax rates within certain parameters each year. The tax rate of different levies multiplied by the taxable value of your home equals the property tax bill you pay each year. As a general rule, as spending goes up, taxes go up.
Related: A Guide to Maximizing Homestead Exemption and Cap Benefits
Homeowners can stay apprised of both categories by following the local news and knowing when the legislature or local governments are planning big changes.
2023 Property Tax Changes: The Biggest Impacts
Recently, one of the biggest changes was the 2023 passing of property tax cuts. The changes retroactively went into effect for 2023. However, whether those changes were reflected on the paper bill you received last autumn differed based on the policies set by each local taxing authority. For 2024, the adjustments should be much more transparent from the start. Look for these four changes, as each one can impact your property taxes.
Higher Homestead Exemptions
Qualifying Texas homeowners who own their primary residence can apply for a homestead exemption. This measure provides two primary benefits:
- Part of your home’s value will be exempted when calculating school district taxes.
- There is a cap on how much your home’s taxable value can increase year over year. Currently, homes protected with a homestead exemption won’t see their property’s taxable value increase by more than 10% each year (unless you’ve made improvements or renovations that increase its value). This is designed to curtail, or at least stabilize, market factors’ effects on your property tax bill.
In 2023, the Texas legislation increased the exemption amount from $40,000 to $100,000. Therefore, if you own a $400,000 house, you’ll pay school district taxes as if it’s a $300,000 house.
Lower School District Tax Obligations for Homeowners
School district taxes themselves are also lower. Measures are in effect to limit increases in school district tax rates, and rather than having property tax revenue pay the balance, Texas is allocating a portion of the surplus from past years to make up for budget shortfalls.
Three-Year Pilot Program Instituting a Cap for Non-Homestead Properties
Previously, only homesteaded properties had a cap against uncontrolled taxable property value increases. Now, non-homestead properties (such as qualifying vacation homes and rental properties) have a 20% cap on increases. However, this program is currently only temporary, so property owners still need to carefully manage their appraisal values.
Voted-In Members of the Appraisal Committee
When homeowners protest their property taxes each year, the process is overseen by a local property appraisal district board. Previously, these members were appointed. Now, three members will be elected, giving homeowners elected representation on matters of property tax calculations and enforcement.
How to Make Use of These New Changes
Each of these changes offers significant savings for homeowners, but you won’t be able to access all of those benefits automatically. Instead, there are a few housekeeping tasks and ongoing strategies you can use to take full advantage of these changes and keep your property tax bills as low as possible in the future. Make sure you complete all three of these tasks this spring.
File Your Homestead Exemption If You Haven’t Already
The recent exemption increase will save most homeowners at least $600 because school district taxes are such a major component of property tax bills. The ongoing effects of the homestead exemption amount and the 10% cap compound each year to save you more and more money the longer you have the exemption in place.
Related: A Texas Homeowners’ Guide to Protesting Taxes: A Step-by-Step Approach
If you think you qualify for a homestead exemption—as well as any supplemental measures like an over-65 or disabled homeowner exemption—check your property record with your central appraisal district to make sure it’s in place. If it’s not, file your exemption as soon as possible.
Protest Your Property Taxes Every Year
This spring, you’ll receive a Notice of Appraised Value if your home’s value changes. It will include your new market value for 2024 as determined by local appraisers, and it’ll also provide instructions for filing a protest notice.
If you believe your appraisal value is too high, you can protest and provide a countervaluation. This process involves presenting your evidence, having formal or informal meetings, and finally, presenting your arguments in front of an appraisal review board (ARB).
By lowering the appraisal value every year, you protect yourself from market increases and a sudden surge in property tax dues if you ever lose your exemption. You can also hire a property tax protest service to represent you throughout the entire process.
Review Your Property Tax Records to Make Sure They’re Fair and Accurate
You don’t have to wait until you receive a notice in the mail. Visit your local central appraisal district’s website and look up your home’s appraisal value, taxable value, and current exemption status. Regularly reviewing these details gives you advance notice if some details are wrong, and you can see the individual cost of each levy that applies to your home.
Experts Can Help You Protest Your Property Taxes Every Year
The recent Texas legislation will have a big impact on homeowners. Home Tax Shield is here to help ensure you can access all the savings opportunities available. Capitalize on the financial benefits of keeping your home’s appraisal value low by protesting every year. Our team can file your protest notice, manage communications, and represent you during the entire process. Best of all, we can repeat it every year so your property value stays fair. Sign up today and we’ll handle the rest.