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How to Calculate Property Tax in Texas
December 5, 2023|Divorce, Estate Planning, For Rent, For Sale, Katy, Life, Market News, Mortgages, Real Estate
An easy way to estimate your property taxes using the convenient Property Tax Calculator for Texas. This user-friendly tool allows you to quickly and accurately calculate your property taxes based on the current tax rate in your area.
Simply enter your property value, your tax rate, and any exemptions you might have to calculate a Tax estimate. Check it out here: https://thegiffordgroup.net/home-buyers-guide
Read about the New 100,000 Homestead exemption.
How To Calculate Property Taxes in Texas
Here are some essential things that you should know about property taxes in Texas around the Houston area:
Check out our Blog on Refinancing
Property Taxes Are Calculated Based
On the Property’s Value In Texas, where the Houston area is located, property taxes are calculated based on the value of the property.
Check out LOCAL PROPERTY APPRAISAL AND TAX INFORMATION
Your property’s value is assessed
by the Harris County Appraisal District (HCAD) or your county's tax office (see more below), which calculates the value based on the market value of the property, its location, and amenities.
Looking for Katy Tax Rates for different neighborhoods?
Market Value vs Appraised Value?
See other Appraisal Districts below.
RESIDENCE HOMESTEAD EXEMPTION FREQUENTLY ASKED QUESTIONS
Property Taxes Are Used for Local Services
The property taxes paid by Houston homeowners are used to fund local services such as school districts, hospitals, law enforcement, and public transportation. The taxes collected are distributed to the different neighborhoods where the property is located.
It is important to note that this Exemption Total Value is made up of (Homestead Cap loss & the 20% homestead Exemption on Appraised value).
HOMESTEAD CAP EXPLAINED
The Texas Property Tax Code Section 23.23 establishes a restriction on the annual increase of the total assessed value for properties under the homestead exemption.
Under this provision, any increase in the assessed value is limited to 10% from year to year, excluding any improvements made by the property owner.
It is important to note that this limitation applies solely to the assessed value and does not impose any restrictions on changes in the market value of the property.
Market value refers to the price at which a property would sell and can vary each year based on sales data. (Not used for tax purposes thankfully!)
The assessed value, on the other hand, is utilized to calculate property taxes. As a result, it is possible to observe two distinct values for the same property: the market value and the assessed value. The discrepancy between these values is referred to as the Homestead cap loss.
In this Example this year (for 2023) appraised value is $487,267. There is a $92,052 cap loss from previous years, as the home's Appraised value can NOT go up more than 10% each year you lived in the home. For residence homesteads, the annual increase is limited to 10% more than the previous year’s appraised value plus new improvements.
The previous year's Appraised value (2022) was $442,970. So $442,970 * 1.10% = $487,267 new (max Appraised value, even though they think the Market value is
So the new Appraised value in 2023 will be $487,267.
Different Tax Rates VS Different Taxable Values
They all have Different Tax Rates, and Each has Different Taxable Values!
Look at the 4 Different Taxes you pay in Fort Bend County for this house.
Taxing Authority Tax Rate Taxable Value
Fort Bend Drainage 0.0129 $389,814 = $5,028.60 (20% Homestead Exemption on this)
Fort Bend General 0.4383 $389,814 = $1,708.55 ( 20% Homestead Exemption on this)
Fort Bend MUD 151 0.850 $487,267 = $4,141.77 (No Homestead Exemption on this MUD Taxes, some counties do offer exemptions)
Lamar CISD 1.242 $447,267 = $5555.06 ($40,000 homestead Exemption on school taxes)
M.U.D Taxes
In addition to MUD taxes, counties, school districts, colleges, and other local property taxes are listed. In contrast, MUD taxes pay for the initial utility services installed in the neighborhood, while other taxes go to their respective taxing entities, so MUD taxes are temporary.
MUD taxes are used to pay off bonds or loans, so as more payments are made, the tax rate becomes lower. More residents moving into a MUD also lowers the rate per resident over time.
All the different Mud Bond in Houston Area
Read more about MUD Taxes
Read about Homestead Exemption and Other Property Tax Savings
Know what Exemptions Are Available
There are exemptions available for some homeowners that reduce their overall property tax burden. For example, the homestead exemption is available for primary residences, and it exempts a portion of the home’s assessed value from taxation. Other exemptions are available for senior citizens, disabled persons, and veterans.
There are several types of exemptions you may receive.
- School taxes:
All residence homestead owners are allowed a $100,000 residence homestead exemption from their home's value for school taxes. (this was updated from $25,000 in 2021, and $40,000 in 2022 )
- County taxes:
If a county collects a special tax for farm-to-market roads or flood control, a residence homestead is allowed to receive a $3,000 exemption for this tax. If the county grants an optional exemption for homeowners age 65 or older or disabled, the owners will receive only the local option exemption. Check your tax county
- Age 65 or older and disabled exemptions:
Individuals age 65 or older or disabled residence homestead owners qualify for a $10,000 residence homestead exemption for school taxes, in addition to the $40,000 exemption for all homeowners. If the owner qualifies for both the $10,000 exemption for age 65 or older homeowners and the $10,000 exemption for disabled homeowners, the owner must choose one or the other for school taxes. The owner cannot receive both exemptions.
- Optional percentage exemptions:
Any taxing unit, including a city, county, school, or special district, may offer an exemption of up to 20 percent of a home's value. But, no matter what the percentage is, the amount of an optional exemption cannot be less than $5,000. Each taxing unit decides if it will offer the exemption and at what percentage. This percentage exemption is added to any other home exemption for which an owner qualifies. The taxing unit must decide before July 1 of the tax year to offer this exemption.
- Optional age 65 or older or disabled exemptions:
Any taxing unit may offer an additional exemption amount of at least $3,000 for taxpayers age 65 or older and/or disabled.
Property Taxes Are Due Annually, Property taxes are due once a year, usually on January 31st.
However, Texas allows homeowners to pay their property taxes in installments. Homeowners can opt to pay their property taxes in four installments between October and January.
Should you Buy Now or Wait Calculator is a tool designed to empower you with the information you need to make informed financial choices.
How do I apply for a homestead exemption?
You must apply with your county appraisal district to apply for a homestead exemption. Applying is free and only needs to be filed once. The application can be found on your appraisal district website or using Texas Comptroller Form 50-114.
Property Tax Deferrals in Texas
In Texas, property tax deferrals offer homeowners the option to delay the payment of their property taxes under certain circumstances. These deferrals are designed to assist individuals who may be facing financial hardships, To qualify for this deferral, you must be a senior, a person with a disability, or the surviving child or spouse of a senior or person with a disability.
By deferring property tax payments, eligible homeowners can alleviate immediate financial burdens and gain more time to manage their tax obligations. It's important to note that property tax deferrals are not forgiveness programs but rather temporary postponements.
Homeowners should consider utilizing property tax deferrals when they are facing financial constraints and are unable to make timely payments. However, it's crucial to carefully review the eligibility requirements, as well as any interest or penalties that may accrue during the deferral period, to make an informed decision about utilizing this option.
There is a 5% annual interest fee on deferred taxes, compared to 24% on unpaid taxes that are not deferred. This interest is deferred until the home is sold or the owner dies. Read more here Tax code chapter 33
- To avoid foreclosure and unexpected payments, it is important that you talk to an attorney or a tax professional before applying for a deferral.
- Asking for a deferral: Use Form 50-126 or check with your appraisal district to see if they have a different form they want you to use. File the form with your appraisal district or assessor’s office.
The Property Tax Rate VARIES by Location,
The property tax rate varies depending on the location of the property, as it may have M.U.D. taxes, higher school taxes, or college taxes.
The Hidden Costs of Home Ownership, and How to Save Money.
In the Houston area, property tax rates range from 1.4% to 3.35 % of the property’s assessed value.
Wonder Why do we have Higher Property Taxes in Texas compared to other states?
One reason is we don't have income taxes in Texas. Texas doesn't levy a state income tax, so the state relies more heavily on property taxes to fund public services such as schools, infrastructure, and public safety.
Property taxes are one of the essential revenue sources for the local government, and they play a significant role in your finances as a homeowner.
In Texas, local governments have more control over property taxes than in other states, leading to a broader variety of property tax rates and assessment methods. This means some areas may have higher or lower property taxes depending on local policies and needs.
If you’re planning to purchase a property in Houston, knowing about the property taxes will help you plan your financing.
To get an accurate estimate of the property tax rate for a specific property, homeowners can check with the local appraisal district or the county tax office.
How much can you afford to spend on housing?
In conclusion, property taxes are an essential aspect of buying and owning a property in the Houston area of Texas. Knowing about property taxes will help you plan your finances, budget accordingly, and make informed decisions when buying or selling a property. If you need any further assistance regarding property taxes, feel free to reach out to a trusted real estate professional for guidance.
Read about Title insurance and what you need to know.
Which is better for you? Buying or Renting?
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HOW MUCH WILL YOU MAKE? SELLERS NET SHEET
Thinking about selling see our Capital Gain Tax Calculator
Check out the Latest Market News
Taxes' values go up.
Taxes on your home are going up along with home values.
This is not unusual for prices to go up and is one of the reasons why homeowners have a higher net worth than renters 40 times higher in Fact.
The current homestead exemption increased from $40k to $100k under the new bill
Exemptions are going to up to 100K if Voters pass the Amendment.
Where do you apply for any of these Exemptions?
At your local Appraisal District in the county in which your property is located. Here is the contact info for local Appraisal Districts.
Austin 979.865.9124 www.austincad.org
Brazoria 979.849.7792 www.brazoriacad.org
Chambers 409.267.3795 www.chamberscad.org
Fort Bend 281.344.8623 www.fbcad.org
Galveston 409.935.1980 www.galvestoncad.org
Harris 713.957.7800 www.hcad.org
Liberty 936.336.5722 www.libertycad.com
Montgomery 936.756.3354 www.mcad-tx.org
San Jacinto 936.653.1450 www.sjcad.org
Walker 936.295.0402 www.walkercountyappraisal.com
Waller 979.921.0060 www.waller-cad.org
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Are You Seeking Real Estate Help During Your Divorce?
Real Estate Agents and Lenders That Actually Specialize in Divorce Support
We can help you during all stages of divorce, not just Real Estate, as we have relationships with Lawyers, CDFA's, Inspectors, Mediators, Counselors, and more. We are a local Realtors and Lenders with the knowledge you need. Trust that you will always be working with professionals, and let us support you whenever you need it.
We work with Family Law Attorneys daily.
If you live in the Houston area and are thinking about or going through a divorce, contact us today. We are your Houston Divorce Real Estate experts.
See our Videos on Divorce and Real estate
Does The Gifford Group Only Help With Divorce Situations?
No, we can help with all real estate transactions. While Divorce Real Estate is our primary focus, all real estate transactions come with risks. We help uncover the risks that need to be addressed in almost every transaction. Read our blog.
Also, Check our New book, Two Roads, One Journey: Navigating Divorce Through God’s Grace - Divorce is more than an ending—it's a new beginning. Amber and Scotty share their inspiring journeys of faith and healing, offering hope and guidance to transform this challenging season into an opportunity for personal growth.
Even though you are not going through a divorce, it does not mean that our Network of experts is any less valuable to you.
We help with all transactions, selling a home and buying a home.
Looking to purchase or refinance your home, we can do that too!
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We can assist you if you are looking for a home.
Who Keeps the House in a Divorce in Texas? Who Has to Leave the House in a Divorce
Even a judge cannot alter a decision made by the husband and wife in mediation about who keeps the house.
But even if you get a divorce decree or a mediation order, it doesn't mean everything is decided about the house. While the divorce decree says who gets the house, it does not legally transfer the property.
We are divorce lending specialists with over 20 years of proven experience helping clients who are going through a divorce with their mortgage needs.
So, you need to make sure the property is solely in your name, or you may have trouble selling it in the future. What is Community property vs Separate property?
In addition to providing answers to questions about the home, our team is here to help you discover potential unknowns that might not have been apparent. We are here to assist you in making informed decisions about your home and help uncover areas of risk you might not know.
How to Buy your Ex Out of the House?
This divorce buyout calculator can give you an idea of how much equity you have to divide with your spouse. We can help determine how to calculate buying someone out of a house? How do I give my spouse equity in a divorce?
This will help you answer the question like, Can I keep the house or should we sell it? Can I Buy out my ex-spouse's Equity?
This Buyout Calculator can calculate three different scenarios and how much equity will be available to split in each case.
refinance divorce buyout
The divorce process can make real estate even more complicated. It is our goal to provide the answers to common questions, such as, What is my House worth?
Have you been court ordered sale of the house in a divorce?
Divorce Real Estate is our primary focus. We help uncover the risks that need to be addressed in almost every transaction.
We are local Houston Real Estate Agents and Lenders that specialize in divorce. There are several options that spouses need to consider when deciding on what to do with the family house.
Can a judge order you to sell your house?
Yes, this is a possibility. The Gifford Group is here to help you make informed decisions before you get to the point.
Even if the court orders you to sell the house, we can still help you. As a full-service real estate firm, we assist with all transactions, from selling and buying new homes.
Where Do You Turn During a Divorce? Divorce Is One Of The Most Stressful Events In Life.
We have both been through Divorce before, and we can assist you in navigating through the unknowns with the House. We are here to help. Remove the Fear, Learn the Facts. Our experience with divorce means we can assist you in navigating the unknowns. While going through a divorce, choosing a Realtor® is a very important decision. You may ask yourself.
Do I need a Realtor if I am going through a divorce?
The answer is YES, but you do not just want any Realtor, but one that Specializes in Divorce Real Estate.
When you are going through a divorce, your home is one of your largest assets, and you want to stay protected.
We can lead you through the divorce laws in Texas.
Use the Divorce Alimony Calculator below to calculator the total maintenance support you will receive and for how many years?
Divorce Experts in Texas, From The NADP Houston Chapter
Experts In Divorce From The NADP- Our company is a member of the Houston chapter of The National Association of Divorce Professionals. Our monthly meetings include Family Law Attorneys, Divorce Coaches, CDFAs, Lenders, Divorce Real Estate Specialists, and More. There are many great success stories we hear and share about how we are able to help divorcing clients, which is one of the main reasons we are a part of this group. In addition to this, we share referrals to assist clients experiencing difficulties in the divorce process. Second, the goal of NADP is to enable us to gain insight into areas outside of our main areas of expertise by sharing knowledge within the group.
We can provide a free consultation just like Divorce Lawyers in Houston, TX.
Can I keep the House in a Divorce? Compassionate Real Estate Support, Remove the Fear, Learn the Facts
Do you want Divorce Support from Local Lenders and Licensed Realtors? We hold the RCS-D designation - Real Estate Specialist - Divorce and the (CDS) Certified Divorce Specialist designation. We are equipped with valuable divorce-specific information and a customized communications skill set to work with and collaborate on low and high conflict divorce cases.
