If you own a home in Texas, you have undoubtedly, at some point, received a property tax bill. Property taxes are:
- A significant source of funding for local governments.
- Supporting the maintenance of public infrastructure.
- Police enforcement.
- Other community-beneficial activities.
Local governments are able to levy taxes since there isn’t a state income tax.
We’ll go over Texas property tax computation methods so you may better understand how much you have to pay.
How Are Property Taxes Calculated?
The assessed value is the basis for property taxes. Every Texas taxable property must be valued at 100% of its fair market value as of January 1st of every year. Its market value is The amount it would sell for in the current market.
The process of mass assessment is employed to guarantee equitable treatment. The county appraisal district establishes the value of properties based on many characteristics, including size, location, condition, and any modifications or enhancements made to the property.
The taxing bodies that are connected to each property, such as the city, school district, and water company, determine the tax rates that apply. Everybody establishes his own tax rate.
The appraised value is multiplied by the tax rate (millage rate) to determine property taxes. The majority of homeowners have multiple taxing bodies with the authority to levy taxes on their properties. Your property taxes will be calculated using the tax rates and appraised value, excluding any exemptions.
The Operation of the Texas Property Tax System
This is a synopsis of the procedure that establishes what is paid in taxes.
- Evaluation
The appraisal of your property is the first stage in the property tax process. The county appraisal district (CAD), which establishes your property’s value as of January 1 of the current tax year, is in charge of doing this.
The property’s size, location, state, and any additions or modifications are all taken into account by the CAD.
- Notice of Appraised Value
You will receive a Notice of Assessed Value from the CAD when they have assessed your property. In April, residential homesteads receive this notice. It displays your property’s assessed value along with any applicable exemptions.
If you think the appraised value is too high, you have the right to object to it.
- Rate of Taxation
Your local taxing units will determine their tax rates by September 30th or by the 60th day following the taxing unit’s receipt of the certified appraisal roll, whichever date is later, following the CAD’s appraisal of your property.
Taxing units include the county, city, school district, and other local entities that offer services to your area. The tax rate is a percentage of your property’s appraised value.
- The Tax Bill
Lastly, a tax bill reflecting the total property taxes due for the year will be sent to you. This bill will show the overall tax rate, the property’s assessed value, any applicable exemptions, and the total taxes due.
Tax bills are mailed in October to Texas homeowners and are due immediately upon receipt, although homeowners have until January 31.
How to Lower Your Property Tax Obligation
Gaining an understanding of Texas property tax computations will help you make better financial and long-term planning decisions. Please don’t hesitate to seek advice from your local taxing unit or appraisal district if you have any queries or worries regarding your property taxes.
You can dispute the appraised value of your property in front of an appraisal review board if you disagree with the assessment. You will have to submit a protest to the county appraisal district along with supporting documentation for your claim.
Final Note
To help with this process, you can also work with a property tax protest company. With decades of expertise in the field, the Freedom Capital Management consultants know what it takes to prevail in an appeal. To get started, register your property with our company.
