Does Texas have a personal property tax? Yes, but only on tangible personal property used to produce income. If you own furniture, clothes, electronics, appliances, or a car you drive for personal reasons, those items are exempt from property tax under state law and you owe nothing on them. Business assets — the equipment, inventory, and machinery a company uses to earn revenue — are taxable and must be reported to the local appraisal district each year. A separate state exemption wipes out the tax bill for many small operations by shielding up to $125,000 of business personal property value.
Personal-Use Belongings Are Exempt
Texas Tax Code Section 11.14 exempts all tangible personal property you own and use for purposes other than producing income.1State of Texas. Texas Tax Code Chapter 11 – Taxable Property and Exemptions That covers essentially everything in a normal household: furniture, appliances, electronics, clothing, sporting goods, jewelry, and the like. It also covers vehicles you use for commuting, errands, and family driving. You don’t file anything to claim this. The exemption is automatic, and your possessions simply sit outside the property tax base.
One category is carved out: manufactured homes are handled separately, even when they’re your residence. More on that below.
Business Personal Property Is Taxed
Once tangible property is used to make money, the rule flips. Texas Tax Code Section 11.01 treats all tangible personal property in the state as taxable unless a specific exemption applies.1State of Texas. Texas Tax Code Chapter 11 – Taxable Property and Exemptions For a typical business, that means office furniture, computers, tools, machinery, raw materials, and inventory held for sale. If it helps generate revenue, the appraisal district expects to see it on your annual rendition.
Where the property sits on January 1 controls which local taxing units can tax it for the entire year. That location is called the property’s situs, and moving equipment later in the year doesn’t change the tax picture for that year.2Texas Comptroller of Public Accounts. Business Personal Property Rendition of Taxable Property Form 50-144 Owners who operate across multiple counties should keep clear records of what was where on New Year’s Day.
Leased equipment is taxable too. The property’s owner, or a fiduciary who manages and controls it, files the rendition.2Texas Comptroller of Public Accounts. Business Personal Property Rendition of Taxable Property Form 50-144 In most leases the lessor reports and pays the tax and then passes the cost through in the lease payment, but the contract governs. Check yours if it’s not clear.
The $125,000 Exemption That Zeros Out Many Small Businesses
Texas Tax Code Section 11.145 lets each person or business exempt up to $125,000 of the appraised value of income-producing tangible personal property at a single address within a taxing unit.1State of Texas. Texas Tax Code Chapter 11 – Taxable Property and Exemptions If everything you have at one location appraises below that number, you may owe no business personal property tax at all.
The statute blocks a workaround. Related business entities — companies that share a common enterprise and have property at the same physical address — must combine their property values under a single $125,000 cap. You can’t split assets across affiliated shells to stack the exemption.
Manufactured and Mobile Homes Follow Their Own Rules
A manufactured home in Texas is personal property by default under Texas Occupations Code Section 1201.2055. It becomes real property only if the owner affirmatively elects that treatment when applying for a statement of ownership.3Texas Public Law. Texas Occupations Code Section 1201.2055 – Election by Owner
Two conditions have to be met to make the election: the home must be attached to real property you own, or it must sit on land you lease under a long-term lease as defined by department rules. After the statement of ownership issues with the real-property election, you have 60 days to file it in the county real property records and notify both the department and your local chief appraiser.3Texas Public Law. Texas Occupations Code Section 1201.2055 – Election by Owner Skip any of that, or sit on land you don’t own or long-term lease, and the appraisal district keeps treating the home as personal property.
Filing an Annual Rendition
If you own income-producing tangible personal property, you file a rendition with your county appraisal district each year. The rendition lists your business assets and your good-faith estimate of what they’re worth.4Texas Comptroller of Public Accounts. Texas Businesses – April 15 Is Deadline for Filing Property Tax Renditions The standard form is Form 50-144, Business Personal Property Rendition of Taxable Property.2Texas Comptroller of Public Accounts. Business Personal Property Rendition of Taxable Property Form 50-144 You’ll report:
- Your legal name and contact information
- A description of each category of property: inventory, furniture and fixtures, machinery, equipment, and other assets
- The physical address of the property as of January 1 of the current tax year
- A good-faith estimate of each category’s market value
The deadline is April 15. Ask the chief appraiser in writing for more time and you can push it to May 15.5State of Texas. Texas Tax Code Chapter 22 – Renditions and Other Reports Most counties accept the form by mail or through an online portal.
The information on your rendition is confidential and can’t be disclosed to third parties except in limited circumstances. The appraised value the district lands on is public; the form you filed is not. Your good-faith value estimate also can’t be used against you outside a protest hearing or a penalty-related court case.
Penalties for Filing Late or Filing Falsely
Under Texas Tax Code Section 22.28, missing the rendition deadline costs you 10 percent of the total property taxes charged on the unreported property for that year.5State of Texas. Texas Tax Code Chapter 22 – Renditions and Other Reports The appraisal district must send you notice of the penalty by June 1.
A fraudulent filing costs far more. If a court finds you filed a false rendition intending to commit fraud or evade tax, or that you altered, destroyed, or concealed records to influence the appraisal, the chief appraiser adds a 50 percent penalty on top of the taxes owed for that year.5State of Texas. Texas Tax Code Chapter 22 – Renditions and Other Reports That stacks on the 10 percent late-filing penalty.
Protesting the Appraised Value
If the appraisal district overvalues your business personal property or denies an exemption you should have gotten, you can protest to the local Appraisal Review Board. Texas Tax Code Section 41.41 lays out the grounds:6State of Texas. Texas Tax Code Section 41.41 – Right of Protest
- The appraised value exceeds market value
- Your property is valued unequally compared with similar property in the area
- The appraisal roll lists your property in the wrong taxing jurisdiction
- You were denied an exemption you qualify for, including the $125,000 business personal property exemption
- Any other action by the chief appraiser or district that adversely affects you
You start by filing a written notice of protest with the appraisal district, generally by May 15 or within 30 days of receiving your notice of appraised value, whichever is later. At the hearing you present evidence: comparable sales, depreciation schedules, independent appraisals. If the ARB rules against you, you can appeal to district court, and lower-value properties may qualify for binding arbitration instead.