Property taxes are one of the most expensive bills Texans have to confront every year. And while there is nothing you can do about property tax rates, that doesn't mean you should hastily throw your hard-earned money away before exploring all your options.
A common misconception among Texas homeowners is that they can’t appeal their property tax bill and are required to simply pay the amount listed on the bill they receive. The truth is that Texas law allows you to challenge the amount of property taxes you have to pay by filing a property tax protest.
In order to understand how a property tax protest can lower your taxes, you first need to understand how property taxes are calculated. In Texas, property taxes are assessed by local “taxing units,” such as counties, cities, school districts, and special districts.
The first step in calculating property taxes is to assess the market value of the property. This is done by the local county appraisal district, which uses various methods to determine the property's value. The market value should be the price for which the property would sell in the current real estate market.
Once the market value is determined, the appraisal district will subtract any exemptions that the property may qualify for, such as homestead exemptions, to arrive at the taxable value of the property.
To calculate the property taxes owed, the property's taxable value is multiplied by the tax rate set by each taxing unit. For example, if the taxable value of a property is $100,000 and the local school district’s tax rate is 1%, the property owner would owe $1,000 in property taxes for that taxing unit.
A property tax protest is a formal process by which a property owner can challenge the assessed value of their home and, in turn, reduce the amount of property taxes they are required to pay. In Texas, homeowners can file a protest if they believe that their property's assessed value is too high, which can result in a lower property tax bill.
To start the property tax protest process, a property owner must file a protest with the local appraisal district by the deadline. The protest must include the grounds for the protest. Common reasons for filing protests include that the appraisal district incorrectly appraised the property's value or that the property was not appraised equally to other comparable properties.
After the protest is filed, there is often a period of informal negotiation that occurs between the property owner and the appraisal district. The specific mechanics of these informal proceedings vary between counties, so you’ll need to check with your local appraisal district for more information about how you can address the dispute outside of a hearing.
If the dispute cannot be resolved informally, the property owner will have the opportunity to present their case at a formal hearing. At this hearing, a panel of judges from the county Appraisal Review Board (ARB) will listen to arguments and review evidence from both the property owner and the appraisal district. Once both sides have presented their cases, the ARB will set a final market value for the property in question.
While filing a property tax protest in Texas may seem daunting, not protesting can lead to you overpaying on property taxes for years to come. Texas law prevents the appraisal district from raising the assessed value of your primary residence more than 10% each year, so a successful protest will save you money immediately and benefit you each and every year going forward.
At Watchtower Protest, we understand why some people might be overwhelmed by the process and would rather let someone else take care of it. That’s why our team of professionals handles the entire protest for you, eliminating the stress and uncertainty of trying to navigate the system on your own. Sign up for our risk-free services today, and you won’t pay us a penny unless we successfully lower your property tax bill.
Property tax in Montgomery County - a property tax consultant can help you manage your tax obligations, exemptions, deductions, and how to challenge your assessment.