How High are Property Taxes in Texas

While the tax burden on residents is average, Texas has one of the highest effective property tax rates in the country. Here’s why Texas property taxes are so expensive and what people may do to reduce their property taxes.

There is No State Income Tax

The state of Texas does not have an income tax. However, taxes are a necessary source of income for the government, thus financing must come from someplace, and the ad valorem property tax is the just and equitable option. 

Property taxes are a major source of financing. The average property tax rate in Texas is 1.6 percent, or $5,605. High property taxes may be seen as a compromise for no income tax by some. High property taxes, on the other hand, are a hardship for many.

Differential Tax Rates Between Counties

The state does not determine local tax rates and does not keep local tax data on individual properties. Because the state government cannot control taxes, tax rates vary by county. Instead, property tax rates are established by taxing unit budgets. Local property taxes support school districts. Other institutions, such as cities, hospitals, and junior colleges, may levy taxes on your land, depending on where it is situated. To manage property taxes, you must first control the budget. Every taxing authority is in charge of its own power to vote on budget increases and tax rates. 

Two comparable homes in Dallas County, for example, may pay different amounts in taxes depending on where they are situated, what school district they are in, and so on.

Increased Home Prices

According to Texas A&M’s Real Estate Research Center, housing sales for properties valued at over $300,000 continue to rise. This is attributable, in part, to a scarcity of properties priced under $300,000. 

The change in sales toward higher-priced houses continues to have an impact on median home prices, particularly in major urban regions such as Austin and Dallas.

While the average house price in Texas hill country remains lower than in many other states, property taxes are assessed depending on the value of the residence. Remember that market value and evaluated value are not the same things, even though they are connected and both are impacted by market circumstances.

How to Reduce Your Property Taxes

Texas homeowners, fortunately, have many alternatives for lowering their property taxes:

submit a property tax exemption application or file a property tax protest. Here’s how to do both:

Request a Property Tax Exemption

There are property tax exemptions that might minimize the amount of money that homeowners must pay. These exclusions are available to certain properties or persons.

Property tax exemptions available to Texas residents include the following:

• Homestead exemptions are available if the property serves as your principal dwelling.
• Senior citizens’ exemptions
• Exemptions for those with impairments, including veterans
• Surviving spouses of a handicapped veteran, first responder, or member of the armed services are exempt.
• Temporary catastrophe exemptions

Exemption qualifications differ from county to county. First, you must establish your eligibility. Then you may apply via the appraisal district office in your county. Exemptions are not granted automatically, thus you must prove your eligibility.

Protest Your Property Taxes

Another way to lower property taxes is to challenge the assessed value of the residence. This is referred to as a property tax protest. 

It is free to submit a protest, and homeowners may do so each year, regardless of whether they obtained a decrease the previous year. Every Texas homeowner has the right to challenge their assessment district’s results.

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