Texas homeowners have welcomed recent property tax cuts as a much-needed break from rising housing costs. With property values climbing across the state, many families hoped these changes would signif...
Property Taxes
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3 min read
Texas homeowners have welcomed recent property tax cuts as a much-needed break from rising housing costs. With property values climbing across the state, many families hoped these changes would significantly reduce their tax burden. However, while the new law offers relief, it also contains loopholes that could limit the savings you expect. Understanding these details is critical for homeowners who want to make informed financial decisions.
The challenge is that property taxes are tied to market values, and Texas has seen some of the fastest home price growth in the country. Even with exemptions and rate caps, rising valuations can push tax bills higher. This blog explains what the new law promises, where loopholes exist, and what steps you can take to protect your wallet.
What the New Law Promises
The Texas Legislature passed measures to increase the homestead exemption from $100,000 to $140,000, with seniors and disabled homeowners eligible for up to $200,000 in exemptions. These changes aim to lower taxable property values and reduce overall property taxes. Additionally, caps on property appraisals for non-homestead properties were introduced to curb rapid tax increases.
Lawmakers promoted these changes as historic relief, but the reality is more nuanced. While exemptions reduce taxable value, they don’t freeze your tax bill. If your home’s market value rises significantly, even a higher exemption may not offset the increase. This is especially true in urban areas where housing demand continues to surge.
For many homeowners, the promise of lower taxes may not match the actual outcome.
Another important detail: the law does not automatically apply exemptions. Homeowners must ensure their homestead status is correctly filed with their appraisal district. Missing this step could mean losing hundreds, or even thousands, of dollars in potential savings.
Where Loopholes Come In
Despite these recent tax cuts, appraisal districts and local government entities still have tools to offset reductions. Appraisal districts can reassess properties aggressively, especially in neighborhoods experiencing rapid growth. This means your taxable value could rise even as exemptions increase.
Local governments also play a role. Cities and counties rely heavily on property tax revenue for essential services like schools, emergency response, and infrastructure. When exemptions reduce taxable values, they may adjust tax rates upward to maintain budgets. In some cases, this adjustment can nearly cancel out the savings homeowners expect from the new law.
Timing is another loophole. Appraisal notices often arrive before homeowners fully understand new exemptions. If you miss deadlines to protest valuations or apply for exemptions, you could lose out on savings entirely. These timing issues make it easy for homeowners to assume they’re benefiting when, in reality, they’re paying more than necessary.
Finally, the complexity of overlapping jurisdictions—school districts, counties, and municipalities—creates opportunities for rate adjustments that homeowners may not anticipate. While the state promotes relief, local entities often find ways to maintain revenue streams.
What Homeowners Can Do
To protect yourself, start by reviewing your appraisal notice carefully. Compare your home’s assessed value to recent sales in your area. If it seems inflated, consider filing a protest. Many homeowners successfully reduce their taxable value by presenting evidence of comparable sales or property condition issues.
Also, confirm that your homestead exemption is applied correctly. Seniors and disabled homeowners should verify they’re receiving the enhanced exemption amounts. If you’ve recently purchased a home, double-check that your exemption transferred properly. Missing this step could cost you significant savings.
Staying informed about local government decisions is equally important. Attend city council or county meetings where tax rates are discussed. These meetings often reveal whether officials plan to offset exemptions with higher rates. Understanding these dynamics can help you anticipate changes before they impact your bill.
Finally, consult a property tax professional. Experts can help you navigate deadlines, identify errors, and maximize savings. With rising housing costs and complex appraisal rules, professional guidance can make a significant difference. SWBC’s team of tax advisors specialize in helping Texas homeowners understand these changes and take proactive steps to protect their finances.
Stay Informed and Protected
Property tax laws are complex, and loopholes can erode the benefits of new legislation. Don’t assume relief is automatic—knowledge and timing are key. Contact SWBC’s property tax experts today to review your property tax situation and ensure you’re taking full advantage of available exemptions. Staying informed is your best defense against unexpected costs.
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