March 11, 2021

Property assessment uniformity and tax equity - What does the Texas State Constitution say?

Every property tax owner must pay property tax in the state of Texas. The state has abolished state property taxes and only levies local property taxes on property owners. Numerous local governments may tax your property, such as school districts, cities, counties and various special districts like hospital, junior college or water districts. The state of Texas has over 4,100 local governments that collect and utilize these property taxes. Taxes paid are used to fund local schools, streets, roads, police, fire protection and many other services.

It is important for local taxing units to ensure tax equity, so the tax burden to fund public services is equally shared by all property owners in a local taxing unit's jurisdiction.

All property is taxable. Generally, all property must be taxed based on its current market value. That is the price a property would sell for if both buyer and seller seek the best value when neither is under any pressure to buy nor sell.
Each property in a county must have a single appraised value. This means local governments cannot use different values for the same property; all must use the same value. A single appraisal district for each county ensures that the same valuation is used even when a single property is taxed by different taxing units.

The assessed value for each property must be determined using mass appraisal techniques that comply with the Uniform Standards of Professional Appraisal Practice. Assessment uniformity relates to the consistency and equity of values.
Uniformity has several aspects. Consistency must be ensured in assessment levels between property groups. It must be consistent among neighborhoods, construction classes, age groups, and size groups. The standard on ratio studies by the International Association of Assessing Officer (iaao) recommends that the level of appraisal for each major group of properties should be within 5% of the overall level for the jurisdiction.

In Texas, property taxes are governed by the Texas Tax Code of the State Constitution. Sec. 23.01. (b) says -
"The market value of property shall be determined by the application of generally accepted appraisal methods and techniques. If the appraisal district determines the appraised value of a property using mass appraisal standards, the mass appraisal standards must comply with the Uniform Standards of Professional Appraisal Practice. The same or similar appraisal methods and techniques shall be used in appraising the same or similar kinds of property. However, each property shall be appraised based upon the individual characteristics that affect the property's market value, and all available evidence that is specific to the value of the property shall be taken into account in determining the property's market value."

The law that mandates equity and uniformity is what gives every property owner the right to challenge the annual property tax bill based on comparable properties. Find comparable properties in your vicinity now. (link to tool page or show tool)

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