March 15, 2021

Tax relief legislation that protect you from a sharp increase in property tax bills.

In Texas, Property Tax has had a long history, almost for as long as Texas has existed. After the abolition of State Property Taxes, Texas lawmakers approved some reforms that standardized the administration of local property taxes in 1979. Countywide central appraisal districts (CADs) were created to ensure uniform mass appraisals. The State Property Tax Board (folded into the Comptroller's Office in 1991) led to establishing Appraisal Review Boards to allow taxpayers to contest their appraisals.

Property tax bills came to be calculated as follows:

([Appraised Property Value − Exemptions or Special Appraisals] ÷ 100) × Property Tax Rate

Yet, homeowners in Texas faced a major problem. As a fast-developing state, Texas had several counties with new and used homes whose market values kept increasing sharply year after year. Since appraised values used to calculate property taxes are based on market values, owning property in thriving neighbourhoods meant shelling out more tax dollars each year, owing to increased market values.

Tax Relief Legislation

Tax Relief was a top priority for Texas property owners and lawmakers for a long time. The much-awaited public policy goal finally bore fruit as a culmination of the collective effort y several blue-ribbon committees and task forces.
In a 1997 amendment to the state constitution, the legislature authorized the limitation of the amount by which homestead appraisals can increase each year. This came into effect on Jan 1, 1998. The same amendment also increased homestead exemptions from $5,000 to $15,000.

Texas Supreme Court finding that the school finance system was unconstitutional sparked additional reforms. A 2006 legislation reduced school district maintenance and operations (M&O) tax rates by one-third over two years. It also attempted to replace most of the lost revenue with a broader state franchise tax, increased rates for tobacco products and increased motor vehicle sales tax collections.

In August 2014, the Travis County District Court ruled (as others before it) that the current school finance system is unconstitutional. Many districts have to levy the maximum tax rate to meet the state's educational requirements. Thereby, the court determined that the statewide limit on property tax rates constitutes a de facto state tax. The case moved to the Texas Supreme Court. Additional Findings by the court may result in further tax reforms.

A recently filed lawsuit by the city of Austin concerns the property tax appraisal system and the methods by which appraisals may be challenged. It argues that they disproportionally benefit commercial property owners and that the tax burden is shifted to homeowners as a result.

Property taxes are immensely important for local governments to keep functioning. Yet, efforts are continually made to lessen the burden on homeowners while meeting budgetary requirements.

If you think you are paying more than you should be in property taxes, Learn about some things you can do to save your money.
Learn all about protesting your property tax bill in Texas now.

SAVE BIG on your 2023 property tax!

Spooked by your appraisal notice?

Want to find out how much you can save?

Our systems can identify your savings in a min and notify you!
Enroll now for free
Start typing your county name...

We will never sell/rent your data to any 3rd party. That's our promise. You can unsubscribe anytime.

Disclaimer

Articles presented here are for general information and education only. It is provided as a courtesy to the general public. SQD Taxtech LLC does not warrant that it is accurate or complete. Opinions expressed and estimates or projections given are those of the authors or persons quoted as of the date of the article with no obligation to update or notify of inaccuracy or change. This article may not be reproduced, distributed or further published by any person without the written consent of SQD Taxtech LLC. Please cite source when quoting.

SQD Taxtech LLC, its managed affiliates and subsidiaries, as a matter of policy, do not give tax, accounting, regulatory or legal advice. Rules in the areas of law, tax, and accounting are subject to change and open to varying interpretations. You should consult with your other advisors on the tax, accounting and legal implications of actions you may take based on any strategies presented, taking into account your own particular circumstances.