The upcoming May 7, 2022, statewide Texas election features two proposed constitutional amendments that could lower property taxes if approved. Each could result in your paying fewer property taxes.
You can read the full text of the ballot amendments, but we’ve summarized the information you need to know in the sections below.
Texas Proposition 1 is entitled the “Property Tax Limit Reduction for Elderly and Disabled Residents Amendment.”
There were some unintended consequences after the Texas legislature passed a bill compressing tax rates for school maintenance and operations in 2019. Namely, property owners over 65 years old or disabled could eventually pay more in local school district taxes than the median homeowner. Proposition 1 seeks to prevent this.
For homeowners over the age of 65 and qualified disabled homeowners, there is a "freeze" on the amount of school district property taxes in Texas. The ceiling means that school district taxes cannot increase on your primary residence once you reach 65 or are disabled.
The ceiling only applies to your primary residence that qualifies for a homestead exemption. But the only way your local school taxes will increase after you receive a “senior freeze” is if you make significant improvements to the home, such as an addition with a new bedroom.
If approved, Proposition 1 will extend the tax rate reduction to elderly and disabled homeowners. As school property taxes decrease for other households, Proposition 1 would allow disabled and elderly homeowners also to receive the benefits of lower tax rates.
Unlike Proposition 1, Proposition 2 will affect almost all homeowners in Texas. Proposition 2 is entitled the “Increased Homestead Exemption for School District Property Taxes Amendment” and will increase the school district exemption in Texas from $25,000 to $40,000.
Texas law requires every school district to offer a homestead exemption of $25,000 on a property owner's primary residence. Qualified homeowners must apply for the exemption and can only receive the benefit on their primary home, not a vacation property. If you claim a homestead exemption on another property, whether in Texas or elsewhere, you do not qualify for the school district benefit.
The homestead exemption is applied to your home's tax assessed value before applying the local school district's tax rate. So, if your home has an assessed value of $300,000, the tax rate is applied to only $275,000. For each percentage of the school district tax rate, this is a savings of $250.
Proposition 2 will increase the amount of the school district homestead exemption from $25,000 to $40,000 permanently. If approved, the extra exemption will save qualified homeowners an additional $150 for each percentage of the tax rate charged by their local school district.
Without worrying about what voters do on May 7 and how that affects your tax bills, you can take steps now to lower your property taxes. First, ensure you receive all the exemptions you qualify for, including the homestead exemption. If you are over 65 years old or disabled, check that you are subject to a property tax ceiling on your home.
But the best strategy for lowering your property taxes may be a Texas property tax protest. Through a protest, you can reduce your home's assessed value. If your home is over-assessed, you will pay too much in taxes. A successful property tax protest will lower your assessed value for each local taxing unit, not just the school district. That means savings on all your property tax bills.
The experienced professionals at Watchtower Protest can handle the entire process for you. And we only get paid if you end up with a reduction in your property tax bills! You can register for Watchtower’s risk-free services today through our website.
Property tax in Montgomery County - a property tax consultant can help you manage your tax obligations, exemptions, deductions, and how to challenge your assessment.