Exemptions You May Qualify For
You may be missing out on certain exemptions the State of Texas allows on your homestead. To qualify, check with your local county appraisal district (most have websites) for the forms you will need to fill out. Dallas County residents, for example would go to the Dallas County Appraisal District’s website, www.DCAD.org to check eligibility. Tax exempt status may provide a potential taxpayer complete relief from taxes or at a reduced tax rate, depending on your exemption status. It’s something every property owner should check into and it is completely within your rights.
Property Tax Code Exemptions
Texas offers residents property value protection known as a homestead exemption. Tax exempt status may provide a potential taxpayer complete relief from tax, at a reduced tax rate, or tax on only a portion of the items subject to tax. A homestead exemption legally protects your home’s value from certain real estate taxes. Texas has certain enrollment requirements that are listed directly on the State of Texas Comptroller website in you would like to see the exemptions chart it is available at: (http://www.window.state.tx.us/taxinfo/proptax/proptax_exemptions.html)
Homestead Exemption – homestead exemptions (sometimes called deductions) are a type of property tax relief. Homestead exemptions are typically allowed for homeowners who use their home as their primary residence. These exemptions reduce the assessed value of the home on which property tax bills are based. Homestead exemptions are typically equal to a percentage of assessed value and are limited to a set dollar amount. For example, a homestead exemption might be equal to 10% of assessed value or $45,000 whichever is less.
Residence Homestead Exemption
To qualify for a homestead exemption on your home residence, you must own and reside in your home on January 1 (of the tax year the application is made and cannot claim a homestead exemption on any other property.) If you temporarily move away from your home, you still can qualify for this exemption, if you do not establish another principal residence and you intend to return within two years, or if you are a resident of a health facility, or in the military. If the person who qualifies for an exemption is not the sole owner of the property to which the exemption applies, an application for a residence homestead exemption must be completed by each owner of the residence. Exemptions are allocated according to percent of ownership interest the applicant has in the property.
65 or Older Exemption
If you qualify for the 65 or Older Exemption, there is a property tax “ceiling” that automatically limits school taxes to the amount you paid in the year that you qualified for the homestead and the 65 or Older exemption. Tax ceiling amounts can increase if you add improvements to your home (i.e., adding a garage, room or pool). In addition, 65 or Older homeowners who purchase or move into a different home in Texas may also transfer the percentage of school taxes paid, based on the former home’s school tax ceiling. This is commonly referred to as a Ceiling Transfer. To transfer your tax ceiling however, you must move to another home within the same taxing unit and you must request a certificate from the Appraisal District for the former home (and take it to the Appraisal District for the new home, if it is in a different district.)
Disability Homestead Exemption
Persons with disabilities may qualify for this exemption if they 1) qualify for disability benefits under the federal Old Age, Survivors and Disability Insurance Program administered by the Social Security Administration or 2) have a physician’s statement indicating the date the disability began and that you are unable to engage in any substantial gainful work for a period which has lasted or can be expected to last for a continuous period of not less than 12 months or that can be expected to result in death.
Tax Deferral for Age 65 or Older or Disabled Homeowner
If you are a homeowner who qualifies for the Age 65 or Older or the Disability exemption, you may also defer or postpone paying any property taxes on your home for as long as you own and live in it. It is important to note that this deferral only postpones your taxes and does not cancel them. It also accrues eight (8) percent interest annually until the deferral is removed. When the property is sold or the ownership is transferred to the estate/heirs, the taxes and accrued interest become payable.
Surviving Spouse of a Person who received the Disability Exemption
There may be additional benefits for the Age 55 or Older Surviving Spouse of a person who was receiving the Disability exemption before their death.
Residence Homestead Exemption for Disabled Veteran with 100% Disability
You qualify for this exemption if you are a disabled veteran who receives benefits from the United States Department of Veterans Affairs or its successor 100 percent disability compensation due to a service-connected disability and a rating of 100 percent disability or of individual unemployability. Beginning 2009, this entitles you to an exemption of the total appraised value of your residence homestead.An exemption application must be completed and accompanied with a copy of your V.A. award letter or other document from the United States Department of Veterans Affairs showing 100 percent disability compensation due to a service-connected disability and a rating of 100 percent disabled or individual unemployability. A surviving spouse does qualify for the 100% Disabled Veteran Homestead Exemption, but surviving child does not qualify.
Benefits of Exemptions
All school districts in Texas grant a reduction of $15,000 from your market value for a General Residence Homestead exemption. Some taxing units also offer additional optional reductions for the homestead exemption. In addition, each school district will grant a minimum reduction of $10,000 from the market value for the 65 or older exemption. For optional exemptions, the governing body of each taxing entity decides whether it will offer the exemption and at what percentage or amount.