Are Texas property taxes going down? For most homeowners, yes. Two rounds of legislative cuts — one in 2023 and another in 2025 — raised the school-district homestead exemption to $140,000 and pushed school tax rates well below where they sat a decade ago. Whether your own bill actually drops depends on what your county appraisal district says your home is worth and what your city, county, and special districts charge on top of school taxes.
What Actually Changed
The state has committed over $50 billion to property tax relief across the 2023 and 2025 legislative sessions.1Texas House of Representatives. 2025 Rotunda Report – 89th Legislature Session Summary The money went to three things that matter for your bill:
- A larger homestead exemption, which shrinks the value your school district can tax.
- Compression of school maintenance and operations tax rates, which lowers the rate applied to what’s left.
- A new appraisal cap on non-homestead property, which slows how fast commercial and rental values can rise.
The homestead exemption was $40,000 before 2023. It jumped to $100,000, then to $140,000 for the 2025 tax year forward.2Texas Legislature Online. 89(R) SB 4 – Enrolled Version – Bill Text The maximum compressed school M&O rate for tax year 2025 is $0.8022 per $100 of value, down from $1.00 per $100 before compression began in 2019.3Texas Education Agency. Tax Year 2025 Maximum Compressed Tax Rates
How Much a Typical Homeowner Saves
The homestead exemption is a fixed dollar deduction from your appraised value before school taxes are calculated. The math is straightforward. Take a home appraised at $350,000. The first $140,000 comes off, leaving $210,000 as the taxable value for school purposes. Under the old $40,000 exemption, the same home would have been taxed on $310,000. At a school tax rate around $0.80 per $100, the exemption alone saves this homeowner roughly $800 a year compared to the pre-2023 system.
You do not need to refile if you already have a homestead exemption on record with your county appraisal district. The higher amounts apply automatically.4Texas Comptroller of Public Accounts. Property Tax Exemptions If you have never filed one, you are almost certainly overpaying.
Bigger Cuts for Seniors, Disabled Homeowners, and Disabled Veterans
The additional exemption for homeowners who are 65 or older, or who qualify as disabled, went from $10,000 to $60,000. That stacks on top of the general exemption for a combined $200,000 school-tax deduction.5Lt. Governor of Texas. Lt. Gov. Dan Patrick Statement on the Passage of Senate Bill 23 and Senate Joint Resolution 85 Combined with the tax ceiling that freezes school taxes for these homeowners at the amount owed the year they first qualified, the average senior’s school property taxes are effectively wiped out.
The ceiling itself is a separate protection. Once you turn 65 or qualify as disabled and have a homestead exemption, your school taxes cannot rise above what you paid in your qualifying year. Rates dropping or exemptions growing can bring the number down, but it cannot climb back up unless you add significant improvements like a new room or garage. The ceiling is transferable to another Texas home, though you have to work with the new county’s appraisal district to complete the transfer. Cities and counties may offer their own optional freezes on top of the school freeze; not all do.
Veterans who have received a 100 percent disability compensation rating from the U.S. Department of Veterans Affairs are exempt from all property taxes on their residence homestead. This is a complete exemption on school, county, city, and every other taxing entity.6Texas Comptroller of Public Accounts. 100 Percent Disabled Veteran and Surviving Spouse Frequently Asked Questions A surviving spouse married to the veteran at the time of death can inherit the exemption on the same or a different homestead, as long as they have not remarried.
The Part of the School Bill Compression Doesn’t Touch
A school tax bill has two components. Maintenance and Operations (M&O) covers daily costs like teacher salaries. Interest and Sinking (I&S) pays off long-term debt, mostly school construction bonds. State compression only applies to the M&O side. The I&S rate sits on top and is controlled entirely by each district’s outstanding bond debt.
A district that just passed a big bond election may carry an I&S rate of $0.30 or more per $100, and none of that moves with state compression. So even though the state has driven M&O rates down nearly 20 cents, the total school rate on your bill still includes debt service the legislature cannot reach.
Appraisal Caps That Limit How Fast Your Value Can Rise
Lower rates and larger exemptions don’t help much if your appraised value keeps jumping. Texas has two caps that slow that down.
The 10 Percent Homestead Cap
If you have a homestead exemption on file, your appraised value cannot increase by more than 10 percent per year, no matter what the market does. The cap applies to last year’s appraised value plus the value of any new improvements you added.7Texas Comptroller of Public Accounts. Valuing Property It’s a permanent feature of the Tax Code.
It doesn’t freeze your value. If the market surges 30 percent in a single year, the appraisal district can raise your value 10 percent that year and keep closing the gap in following years. The cap smooths the increases; it doesn’t erase them.
The 20 Percent Cap on Non-Homestead Property
A newer cap applies to commercial buildings, rental houses, and second homes. Their appraised value cannot rise more than 20 percent in a single year, as long as the property is valued at $5 million or less. This cap expires December 31, 2026.7Texas Comptroller of Public Accounts. Valuing Property Unless the legislature renews it, commercial and rental owners will lose the protection entirely in 2027, and the 2027 appraisal cycle could bring a significant catch-up increase.
Why Your Bill Can Still Go Up
The relief above focuses on school district taxes, which are typically the largest slice of a property tax bill but not the whole thing. Cities, counties, hospital districts, community college districts, and special districts each set their own rates. The state has no authority to compress those rates. If your city raises its rate a few cents per $100 to fund infrastructure or public safety, that lands directly on your bill regardless of what the legislature did with school taxes.
Rising appraisals are the other wild card. Even under the 10 percent homestead cap, a property that was undervalued for years can see steady annual increases as the district closes the gap between capped value and market value. Add a pool, renovate a kitchen, or build an addition, and the value of those improvements goes on top of the cap. In a hot market, multiple taxing entities plus creeping appraisals can offset the legislative savings.
Renters see a less direct picture. Savings flow to the landlord, and whether any of it reaches tenants depends on the local rental market. Where demand outstrips supply, landlords set rent by what tenants will pay, and a tax cut is unlikely to change that. In softer markets, lower operating costs may slow rent increases over time. A dollar-for-dollar pass-through is unrealistic.
How to Make Sure You’re Getting the Savings
File Your Homestead Exemption
If you bought a home and never filed a homestead exemption application, you are leaving money on the table. The application window runs January 1 through April 30 with the appraisal district in the county where the property is located.8Texas Comptroller of Public Accounts. Property Tax Law Deadlines
Missed April 30? Texas law allows a late homestead exemption application up to two years after the date the taxes on that property became delinquent, typically February 1 of the year after the tax year in question.9State of Texas. Texas Tax Code Title 1 Subtitle C Chapter 11 Subchapter C Section 11-431 – Late Application for Homestead Exemption Filing late lets you recoup exemption benefits you should have been receiving.
Inherited a home without going through formal probate? You can still qualify as an heir property owner even if your name is not on the deed. The appraisal district will want an affidavit establishing your ownership interest, a copy of the previous owner’s death certificate, and a recent utility bill showing you live there. Each co-heir living in the home must also submit an affidavit authorizing the application.4Texas Comptroller of Public Accounts. Property Tax Exemptions
Protest Your Appraisal If It’s Too High
Legislative relief only controls the rate side. Your appraised value is set locally, and protesting it is the most direct way to lower your bill if the number looks wrong.
The deadline to file a notice of protest is May 15 or 30 days after the appraisal district mails your notice of appraised value, whichever is later.8Texas Comptroller of Public Accounts. Property Tax Law Deadlines Miss it and you’re stuck with the district’s number for the year.
Most appraisal districts offer an informal meeting first with a staff appraiser. A lot of protests settle here. Bring recent comparable sales, photos of any condition issues that hurt value, and your own estimate of the property’s worth. If you agree on a number, the value is adjusted and you’re done.
If informal talks fail, your case goes to a formal hearing before the Appraisal Review Board. Both sides present evidence under oath, cross-examine witnesses, and offer rebuttal. The ARB then votes on a final value.10Texas Comptroller of Public Accounts. Model Hearing Procedures for Appraisal Review Boards Still disagree? You can appeal to district court or pursue binding arbitration for properties appraised at $5 million or less.
Professional property tax consultants handle protests on a contingency, typically charging 15 to 50 percent of the first-year savings and nothing if they lose. For owners uncomfortable navigating the process, that can be worthwhile. Most homeowners can handle a straightforward protest on their own with a bit of preparation.
Deadlines to Keep on the Calendar
- January 1 to April 30: file or update your homestead exemption application with the county appraisal district.
- May 15, or 30 days after your notice of appraised value, whichever is later: deadline to file a protest with the Appraisal Review Board.
- January 31: last day to pay property taxes before they become delinquent on February 1.8Texas Comptroller of Public Accounts. Property Tax Law Deadlines
- December 31, 2026: expiration of the 20 percent appraisal cap on non-homestead properties unless the legislature renews it.7Texas Comptroller of Public Accounts. Valuing Property