Homestead Exemptions in Texas

If you are a first time homeowner, you should learn about homestead exemption in Texas as it will help you save money on your property taxes. Here is what you need to know.

What is a homestead in Texas?

A homestead can be a separate structure, condominium or a manufactured home located on owned or leased land, as long as the individual living in the home owns it. A homestead can include up to 20 acres, if the land is owned by the homeowner and used for a purpose related to the residential use of the homestead. You can own multiple properties in Texas but only your primary home will be designated as homestead.

Do I, as a homeowner, get a tax break from property taxes?

You may apply for homestead exemptions on your principal residence only. Homestead exemptions remove part of your home's value from taxation, so they lower your taxes.

For example, your home is appraised at $100,000, and you qualify for a $25,000 exemption (this is the amount mandated for school districts), you will pay school taxes on the home as if it was worth only $75,000.

Taxing units have the option to offer a separate exemption of up to 20 percent of the total value. All local taxing units, including public hospital districts and special utility districts, can also adopt local homestead tax exemptions that reduce by 20 percent the amount of property value on which Texans are taxed. The governing bodies of local entities, like school boards and city councils, can voluntarily offer these exemptions or residents can petition officials for them.

What is a CAD?

CAD stands for Central Appraisal District and each county has one. The purpose of the CAD is to appraise all property in that county at market value equally and uniformly for the purpose of property tax assessment and to communicate that value annually to each taxpayer and taxing jurisdiction. Hence, this is the same appraisal district you use to keep your property taxes lower and contest the values. The Central Appraisal Districts of North Texas include Dallas CAD, Collin CAD, Denton CAD, Tarrant CAD, and Rockwall CAD. A more comprehensive list is available at the end of this page.

Do all homes qualify for homestead exemptions?

No, only a homeowner's principal residence qualifies. To qualify, a home must meet the definition of a residence homestead: The home's owner must be an individual (for example: not a corporation or other business entity) and use the home as his or her principal residence on January 1 of the tax year. If you are age 65 or older, or disabled, the January 1 ownership and residency are not required for the age 65 or disabled homestead exemption. Please note that if you buy a new home in the middle of the year, your will not be eligible for the homestead exemption for that year. But you will be eligible next year.

What homestead exemptions are available?

There are several types of exemptions you may receive.

School taxes: All residence homestead owners are allowed a $25,000 homestead exemption from their home's value for school taxes.

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.

Age 65 or older and disabled exemptions: Individuals age 65 or older or disabled residence homestead owners qualify for a $10,000 homestead exemption for school taxes, in addition to the $25,000 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. Note: Other local entities are also able to offer property tax relief. Cities, counties and community college districts can put a ceiling on the tax bills of Texans who are 65 and older, though they’re not required to. Elderly or disabled Texans also have discretion to defer payment of their property taxes by completing an application with their appraisal district. If those Texans go this route, their taxes — plus interest — are due when their property is sold or transferred. Who is responsible for back payments is typically determined as part of the sale or transfer

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. Disabled veterans and the surviving spouses of deceased veterans are also eligible for additional property tax relief. Completely disabled veterans and their surviving spouses do not have to pay any property taxes. Homeowners who fall in this camp have to apply for the exemption with their local appraisal district between Jan. 1 and April 30, per the Texas Comptroller. Partially disabled veterans and their surviving spouses receive property tax exemptions scaled to their disability rating as determined by the Department of Veterans Affairs.

What is a homestead cap value?

Cap value applies to residential homesteads only and it goes into effect the second year after a residential homestead exemption has been granted for your residence. If the property is your residence homestead, the appraised value may not exceed the lesser of the market value of the property or the sum of:

Cap value applies to residential homesteads only. If this property is your residence homestead, the appraised value may not exceed the lesser of the market value of the property or the sum of:

10 percent of the appraised value of the property for the preceding tax year;
the appraised value of the property for the preceding year; and
the market value of all new improvements to the property.

What is the deadline for filing for a homestead exemption?

You may file for any homestead exemption up to two years after the delinquency date. The delinquency date is normally February 1st.

Can I continue to receive the residence homestead exemption on my home if I move away temporarily?

If you temporarily move away from your home, you may continue to receive the exemption if you do not establish a principal residence elsewhere, you intend to return to the home, and you are away less than two years. You may continue to receive the exemption if you do not occupy the residence for more than two years only if you are in military service serving inside or outside of the United States or live in a facility providing services related to health, infirmity or aging.

Can I qualify for a homestead exemption if there are other owners other than my spouse listed on my property? or

If I own only 50 percent of the home I live in, do I qualify for the residence homestead exemption on the home?

Yes. However, if you qualify for a homestead exemption and are not the sole owner of the property to which the homestead exemption applies, the exemption you receive is based on the interest you own. For example, if you own a 50 percent interest in a homestead, you will receive only one-half, or $12,500, of a $25,000 homestead offered by a school district.

Do I have to apply each year?

Once you have received a homestead exemption you need not reapply unless you are contacted by your appraisal district, you move or circumstances have changed that qualify you for a new exemption (for example turning 65 years old).

Is there a fee associated with filing for an exemption?

There is never a fee involved in applying for an exemption with the appraisal district. This is a free service for all taxpayers.

IMPORTANT: If you receive mail or any type of communication requesting money to file for a Homestead Tax Exemption, know that applying is as simple as filling out the necessary document provided from the County Appraisal District. THERE IS NO FEE ASSOCIATED WITH APPLYING FOR HOMESTEAD. If you have any questions or concerns please contact your local Appraisal District.

Is it true that once I become 65 years of age, I will not have to pay any more taxes?

No, that is not necessarily true. The year you turn 65 you may receive the Over 65 Exemption in addition to the General Residential Homestead Exemption. The amount of the exemptions that are granted by each taxing entity is subtracted from the appraised value of your residence and the taxes are calculated on that "lower value".

Do both my spouse and I have to be over 65 years of age to qualify for the Over 65 Exemption?

No. Only one of you needs to be over 65 years of age to qualify for this exemption. Once this exemption is granted, if the qualifying spouse dies, then the exemption would remain in effect for the remaining spouse if the survivor is 55 years of age or older and has ownership in the home. All tax ceilings remain in effect for as long as the spouse lives in the home. The surviving spouse needs to contact the appraisal district office in order to continue receiving the exemption.

What is "Homestead Cap Loss"?

Your residence homestead is protected from future appraisal value increase in excess of 10% per year from the date of the last appraisal plus the value of any new improvements.

What if you I am unsure if I have filed for homestead exemption in the past?

You can call or check your CAD’s website. Likewise, you can check your county’s Central Appraisal District’s website or call them directly to verify.

What happens if I buy or sell a home with an existing homestead exemption?

When you sell or buy a home, the taxes for the year will generally be prorated at the closing. This doesn’t actually change your tax liability; the tax assessor will calculate that later in the year. The proration at closing will be based on estimated taxes due. You should be aware of the rules regarding homestead exemptions so that you are prepared if your actual tax liability turns out to be different.

If you buy or sell a home that has only a general homestead exemption on it, the exemption normally stays in place for that entire tax year. The final taxes for the year will reflect the exemption. However, the new owner will have to qualify for the exemption by filing an application in his or her own name for the following year.

If you buy or sell a home that has an existing over-65 or disability exemption, the rules are different. Whether the over-65 or disability exemption stays in place depends on whether the person who qualified for that exemption transfers it to a different homestead during the same year.

How to apply for Homestead Exemption in Texas? or

Where can I find the homestead exemption application? or

How do I apply and what documents are required to apply for homestead exemption?

Your Homestead Exemption will be denied unless all of the required documents show the same homestead address.

1. Complete the APPLICATION FOR RESIDENTIAL HOMESTEAD EXEMPTION (available on the websites of most county appraisal districts, or at the Texas Comptroller’s website at https://comptroller.texas.gov/forms/50-114.pdf

2. Include a copy of your DRIVER’S LICENSE or IDENTIFICATION CARD from the Texas Department of Public Safety at www.txdps.state.tx.us. The address MUST MATCH the homestead address.

Can I file for homestead exemption online?

Check with your appraisal district and they may allow you to file your Texas homestead exemption forms online.

I am applying online, but cannot find my Notice of Appraised Value with owner ID and PIN number.

Call your local appraisal district for instructions on how to proceed. Some districts allow the forms to be emailed directly.

How do I Calculate Property Taxes After the Homestead Exemption in Dallas county?

http://www.dallascad.org/TaxRateCalculator.aspx

https://access.tarrantcounty.com/en/tax/property-tax/tax-estimator.html

http://www.collincountyappraisaldistrict.org/propertytaxcalculator.html

https://dentoncounty.gov/Departments/Tax-Assessor-Collector/Property-Tax/Property-Tax-Estimator.aspx

How do I know if my homestead exemption was approved in Texas or

I have filed the homestead exemption application. What are the next steps? What is next?

After you’ve submitted your application, it can take four to six weeks for any action to be taken. If your application is rejected, you will be notified and given the opportunity to challenge the decision. The amount of your exemption depends on a number of factors, including where your home is located and how much it is worth. All school districts in the state of Texas grant a reduction of $25,000 from your home's value. Travis County offers exemptions of up to 20% of your home's value. Each homestead exemption situation is unique. If you have any questions regarding your situation, contact your county appraisal district's office.

After your exemption is accepted, you don’t have to apply again the following tax year. A homestead exemption lasts as long as you live in that residence. If you move to a new home, the exemption on your old home expires and you will need to file a new homestead exemption for your new residence.

Should you have any questions about the Texas Homestead Exemption, please refer to the application for your county of residence or visit the Texas Comptroller’s website.

How do I get a general $25,000 homestead exemption?

You may file an Application for Residential Homestead Exemption (PDF) with your appraisal district for the $25,000 homestead exemption up to two years after the taxes on the homestead are due. Once you receive the exemption, you do not need to reapply unless the chief appraiser sends you a new application. In that case, you must file the new application. If you should move or your qualification ends, you must inform the appraisal district in writing before the next May 1st. A list of appraisal district addresses and phone numbers is available online. Below are the local tax accessor office's. Click the link to find, download, and fill out the form to apply for exemption.

Collin County Appraisal District

250 Eldorado Pkwy | McKinney, TX 75069

469.742.9200

www.collincad.org

Dallas County Appraisal District

Dallas Central Appraisal District

2949 North I-35E | Dallas, TX 75247

214.631.0910

www.dallascad.org

Denton County Appraisal District

3911 Morse St. | Denton, TX 76208

940.349.3800