Property taxes are a significant part of the overall cost of owning a home in Texas. The state has no income tax, so property taxes carry a heavy load when it comes to funding public-school, city, and county budgets.
There are two components that go into figuring how much property tax you owe: the value of your home and the tax rate.
Your county appraisal district has the responsibility of appraising your home. The appraisal district bases that value on the location, size, and features of your home, as well as recent sales prices of similar properties in your neighborhood.
Taxing entities, like school districts, cities, counties, municipal utility districts, community colleges, hospital districts, and others, independently set their tax rates. These rates are expressed as an amount per $100 of property value. So a tax rate of 23 cents on a $150,000 property would equal $345 in taxes (150,000/100 x .23).
You may qualify for one or more exemptions that lower your appraised value, and, thus, the tax you owe. You automatically qualify for a homestead exemption on your principal residence. However, you must file for the exemption. Filing is free, so don't be taken in by a scammer trying to charge you a fee to file your exemption.
A homestead exemption lowers the property value that is taxed. For example, a $150,000 property with a $15,000 homestead exemption for your school district will be taxed as if it were valued at $135,000.
There are also exemptions available for homeowners 65 and older, homeowners with disabilities, and disabled veterans.
Once you've qualified for a homestead exemption, your taxable value can't go up more than 10% in a year … unless you've made improvements to the property.
While appraisals generally go up, they can go down in years when market values have decreased.
Learning what the current homeowner is paying in property taxes is helpful. Keep in mind, though, that he may be benefitting from the 10% appraisal cap. If so, when you purchase the property, that cap will no longer apply to your appraisal. Your taxes could go up considerably.
If you think the appraisal district has valued your property higher than its actual value or higher than comparable properties in your neighborhood, you have a
few options:
If you disagree with the appraised value of your home, you must file a written protest prior to the deadline. Make sure to file by May 31 or no later than 30 days after the appraisal district mailed a notice of appraised value to you, whichever date is later.
Remember, the appraisal is completely separate from the tax rates assessed by the various taxing entities. The appraisal district has no control over tax rates.
Additional information from other sources:
Property-tax information from the Texas comptroller
http://www.window.state.tx.us/taxinfo/proptax/
Appraisal district contact information, by county
http://www.window.state.tx.us/taxinfo/proptax/apprdir10/
