Property taxes have been steeply increasing for years. In 2012, the mean property taxes paid per household was $2,790. However, in recent years, the typical property tax bill climbed all the way up to $3,797. While this is a hard price for most households across the state to pay, staggering property tax increases can jeopardize the finances of seniors in particular.
Many seniors live on fixed incomes, face higher medical bills, and have fewer avenues for increasing their household incomes. To resolve some of the hardships that homeowners over 65 face, Texas created the over 65 exemption. This provision supplements the standard homestead exemption to give seniors additional savings opportunities on their school district taxes and other property tax obligations.
For seniors who are eligible, the over 65 exemption can reduce their property tax bills by hundreds of dollars each year. Combining the exemption with property tax protests and other tax relief strategies can help even more.
What Is the Texas Property Tax Over 65 Exemption?
Texas property taxes are managed and calculated via local governments. However, the state government has established the rules for calculating taxes and a handful of tax relief mechanisms. Homeowners can use these tax relief strategies to reduce both the appraisal and taxable values of their homes.
Eligible homeowners can apply for exemptions that lower the taxable value of their properties. Seniors, in particular, have access to advanced tax relief options that can reduce their bills, help stabilize their future bills, and even defer their taxes until death and estate settlement.
Filing a Texas property tax over 65 exemption has no downsides or extra costs, and it’s a recommended strategy for every senior. However, it’s important to know each of the benefits and protections under the exemption so you have a clear idea of what your property tax bill will look like every year.
General Homestead Exemption Supplement
Texas offers a general homestead exemption for eligible homeowners with a primary residence in Texas. Under this general provision, $100,000 is exempted from your home’s value when calculating school district taxes. This mechanism alone saves homeowners approximately $1,000 every year. There are some supplemental exemptions that are attached to it, including:
- Over 65 exemption, which removes another $10,000 from school district tax calculations (and provides a host of other savings mechanisms we’ll discuss later on)
- Disabled homeowner exemption, which removes $10,000 from school district tax calculations; however, a household can only have an over 65 exemption or a disabled homeowner exemption, not both
- Disabled veteran exemption, which reduces the total taxable value of the home on a tiered system based on the property owner’s VA disability rating
Related: 2024 Preliminary Values for Texas
As a general rule, applying for a homestead exemption gives homeowners the most savings, and you only need to file it once. Many counties automatically add the over 65 exemption to your property profile once you become eligible. However, it’s best to contact your county’s central appraisal district office or visit their website to make sure it’s in place.
School District Tax Savings: A Detailed Breakdown
On top of the flat $10,000 exemption, seniors over 65 also receive a homestead tax ceiling, or cap, on the school district portion of their taxes. This ceiling comes into effect the year you qualify for the exemption, and school district taxes will not increase in subsequent years. There are only two exceptions in which your school district tax obligations will change:
- If the school district tax rate in your jurisdiction decreases, your taxes will also go down to meet the new amount.
- If you make substantial improvements to your home, such as remodeling the kitchen, installing a pool, or making other changes that drastically change the value of your home, your school district tax ceiling will be adjusted proportionally to those improvements.
This form of tax relief is particularly advantageous for seniors on a fixed income, as it stabilizes property taxes and makes them much more predictable. Since many seniors may have already paid off their homes and are responsible for budgeting for property taxes on their own, it’s extremely important to make your bill as consistently predictable as possible.
How the Exemption Applies to Spouses
Texas property tax over 65 exemptions can transfer to a surviving spouse in most circumstances. The two main requirements are that (i) the spouse has the same primary address and (ii) the spouse is at least 55. If those two conditions are met, surviving spouses can access the benefits of the over 65 exemption.
Conventionally, the over 65 exemption’s main advantages apply solely to school district taxes. However, some counties extend the benefits to county, city, and junior college levies. In those particular counties, surviving spouses also qualify for those benefits.
How the Texas Property Tax Over 65 Exemption Applies If You Move
If seniors over the age of 65 move to a new home, they can bring many of their benefits with them. While the clock on general homestead exemption caps may “start over,” you will continue to access the $100,000 general exemption and $10,000 over 65 exemption amounts. You can also bring the school district tax ceiling with you as a percentage rather than a flat savings amount.
To illustrate, your current property may have a tax ceiling of $300 where you would otherwise pay $1,000, or a tax ceiling of 30% on school district taxes. If you move to a home that would require a $1,500 school district tax payment, you will only be required to pay 30% of that amount, or $450. Similarly, if you downsize to a home with a $500 payment obligation, your new obligation would be $150.
The process of transferring your tax ceiling is simple. Request a certificate from the chief appraiser over your former home and give it to the chief appraiser in your new tax jurisdiction.
How to Defer Your Property Taxes
Under the Texas Property Tax Code, over 65 homeowners don’t just qualify for annual tax savings. They can also defer their property taxes by filing a tax deferral affidavit, at which point the taxes will be deferred until the primary residence is sold or it transfers ownership. However, there are some considerations to keep in mind:
- Deferred taxes will accrue an interest rate of 5%, which also becomes due at the same time as the total deferred taxes.
- The taxes will be recorded as delinquent taxes.
- Some mortgage lenders don’t allow this option. If you have an escrow account through your lender, they may require property taxes to be paid every year.
Related: 5 Strategies for an Effective Property Tax Protest in Texas
There are pros and cons to this tax relief strategy, but every eligible homeowner can choose to file the affidavit based on their unique needs and preferences.
How to Get the Over 65 Exemption
Receiving the Texas property tax over 65 exemption is simple. If you don’t yet have a homestead exemption, you can file Form 50-114 along with Supplemental Affidavit Form 50-144-A with your local authorities. If you do already have your exemption, you simply refile with the basic form and the supplement. Some tax jurisdictions may also automatically enroll you for the exemption once you qualify. Check your CAD website to see if your property has an over 65 exemption in place, or contact your office directly to confirm.
Property Tax Protests: Another Property Tax Saving Strategy You Should Use
Homeowners in Texas have two primary tools to reduce their property tax burden: exemptions and the right to protest. To maximize your tax savings, you should take advantage of both.
Protesting your property taxes involves challenging the appraised value of your home determined by the county appraisal district. If you believe that your home’s appraised value is too high, you have the right to file a protest with the appraisal review board (ARB).
During the protest process, you’ll present evidence to support your case, such as recent sales data of comparable properties, property condition issues, or discrepancies in the appraisal district’s records. If your protest is successful, the ARB will lower your home’s appraised value, resulting in a lower property tax bill.
A two-step approach gives homeowners the most control over their bills and ensures that property tax obligations are as fair as possible. Seniors especially benefit from protesting their taxes and minimizing the effect of real estate market trends on their long-term homes.
Without protesting, you might see your home values rise 15% or 20% every year based on market factors. Wichita Falls, for example, saw home prices climb by 41.5% in just three years. But protests can help keep those turbulent increases in check.
Choose Tax Experts to Help You Get a Fair Property Tax Bill Every Year
The Texas property tax over 65 exemption is a good start for protecting your house and personal finances. Let Home Tax Shield help with the rest. We offer property tax protest services, and our team will fight to lower your home’s appraised value every year so your tax bills stay predictable and fair.
From filing paperwork to meeting deadlines and presenting arguments at formal meetings, we’ll conduct annual property tax protests on your behalf. Sign up today to be ready for 2025 tax protests, and we’ll continue to represent you every year.