My Appraisal Increased 30% – Do My Taxes Increase 30%? The Answer is No.

You are well aware that property tax appraisals are arriving across the eight counties of Senate District 10.   
It is important to remember:

1. Because of laws passed by the legislature, without voter approval local governments and jurisdictions are prohibited from increasing their total tax revenue – over the previous year – by more than 2.5% for school districts and 3.5% for all other taxing entities.
2. Only 10% of the increase in your homestead property value can be used in determining your actual tax. If you are over 65, your taxes are frozen at the school district level.   When you qualify for an Over 65 or Disabled Person homestead exemption, your property taxes are actually frozen and can never go up; however, this applies only to the school districts, which constitute the overwhelming majority of your property tax bill.   This is sometimes referred to as the “senior freeze” or “homestead tax ceiling”.  However, for the other jurisdictions such as city and county, it is up to each local entity to decide whether or not to freeze your taxes.  Check with your local appraisal district to see which of your local entities have provided this freeze.   

More explanation on this is included below.

In the final month of the current legislative session which ends on May 29th, you will be hearing a lot more about various proposals to reduce the property tax burden in Texas. Rest assured, I am committed to using a substantial portion of the current Texas budget surplus for that purpose.

Below, I’ve outlined some common questions I receive concerning the appraisal process, along with some information I hope will be helpful.

How does the appraisal process work, and how does it impact my
property tax bill?

• First, know that Texas has no state property tax. Local governments are authorized by the Texas Constitution and statutory law to collect local property taxes. The state does not set tax rates, collect taxes or settle disputes between taxpayers and local governments.
• An appraisal notice is NOT a bill; rather, receiving your appraisal is the first step in the process. The actual property tax you pay will be determined after the tax rate is set by your local government entities in the coming months.  

My homestead appraisal went up over 30%. So is my property tax bill going up 30%?

• No. Even though an appraisal may have gone up substantially, taxing districts are limited to using no more than a 10% increase in your homestead property value. Here’s an example:

Previous Assessed Value:        $400,000
New Assessed Valued:             $520,000

In this example, you might think you will be taxed on the new assessment of $520,000 – a 30% increase. However, local taxing districts can use no more than $440,000 ($400,000 x 10% = $40,000) as the taxable value used in calculating the taxes on your homestead.

• As a reminder, don’t forget to confirm that you have filed your personal homestead exemption on your primary residence. Because of changes made in the last legislative session and approved by voters in a statewide election last May, the homestead exemption was raised from $25,000 to $40,000. That means that $40,000 of your appraisal value is removed, thus lowering what your tax bill would have been. (Last month, the Texas Senate passed a plan to increase that the homestead exemption from $40,000 to an historic $70,000, plus an additional $30,000 for seniors.)
• If you are over 65, make sure to file your exemption to freeze your taxes.
• More specific questions concerning your homestead exemption can be found here: https://comptroller.texas.gov/taxes/property-tax/exemptions/residence-faq.php

How does the appraisal process work?  Who sets the tax rates that determine my property tax bill?

• The appraisal value you received was determined by your local Appraisal District. State law requires that properties be appraised at fair market value, using standard methodology outlined by the Texas Comptroller.
• Appraisal Districts are governed by a board of directors selected by the local taxing units outlined below.
• In the coming months, a tax rate will be set by the various taxing jurisdictions in your particular county. These jurisdictions will always include your local school district and county government. Then, depending on where you live, this could also include a city (municipal) tax and potentially others such as a hospital district, water district, community college/junior college district or other special purpose districts. Your local school district taxes constitute the overwhelming portion of your local property tax bill. 

If I disagree with the appraised value of my home, what can I do?   

• If you feel your appraised value is too high, you can appeal. Visit the web site of your county appraisal office, the entity responsible for determining the property value assessment you have received.Links to each county appraisal office are listed at the end of this email.Your appeal will be heard by an appraisal review board (ARB), a panel of your fellow citizens who will then decide if your appraisal should be reduced.
• Important: if you plan an appeal, make sure you pay attention to the upcoming deadlines for appealing your assessment. Those deadlines will be listed on your county’s appraisal district web site.  

What Has the Legislature Done? 

As previously noted, there is no state property tax, but we have still taken aggressive measures over recent legislative sessions to impact the process with the goal of lowering the tax burden.

• Major property tax reforms passed in 2019 forced local governments to seek and obtain voter approval before increasing revenue from the previous year above 2.5% (for school districts – HB 3) or 3.5% for most other taxing units (like cities – SB 2). These pro-taxpayer reforms give homeowners a needed voice during a time when values are growing; without those reforms, tax bills would grow unchecked.
• In 2019, we were able to significantly reduce a huge penalty on landowners when they would change the use of their open space land from agricultural, for example, to another purpose such as building a home or opening a business. For decades, the rollback tax held back land development and penalized family property owners. For example, let’s say you bought or inherited land that had been out in the country. Years later you decided to convert it to a business purpose or maybe just build your new home. At that point, on whatever acreage you converted from “ag exempt” you’d pay five years back property taxes, at full market value, with interest compounded at 7%! In 2019, Texas passed legislation to reduce that five year “claw back” to three years and the interest from 7% to 5%. That was a good start but not enough. 
• That’s why in the 2021 legislative session, I authored and passed HB 3833. By eliminating the interest on rollback property taxes, it was estimated that property taxes will be reduced by $472 million over the next five years.   
• As referenced earlier, last legislative session I supported increasing the residential homestead exemption from $25,000 to $40,000. 

What is the Legislature Doing Right Now to Help Lower the Property Tax Burden?

The current legislative session ends on May 29th. We are working to use the budget surplus to provide more funding for public education in order to “buy down” the local school property tax rates.

Though approaches differ between the House and Senate, there is general agreement that at least $16 billion will be used to provide property tax relief.

I hope this background and information is helpful. If you intend on appealing your appraisal, see the links below.

An appraisal notice is NOT a bill; rather, receiving your appraisal is the first step in the process. The actual property tax you pay will be determined after the tax rate is set by your local government entities in the coming months.

If you feel your appraised value is too high, you can appeal. Visit the web site of your county appraisal office, the entity responsible for determining the property value assessment you have received. 
 

Here are direct links to your county appraisal office:
 
Brown County

Callahan County

Johnson County

Palo Pinto County

Parker County

Shackelford County

Stephens County

Tarrant County