| Real Estate 101

The 2022 Property Tax Estimates are out and it has people scrambling for answers. We wanted to take a moment to try and answer a few of the top questions we’ve received.

Property Tax Valuation FAQ:

Does this mean my taxes will go up?

Not necessarily. So how does that work? So imagine the City of Oz has an annual budget of $100 and it is divided between the 100 houses in its city limits and each property is valued at a $100, therefore, the tax rate is 1%. If the property values double and go up to $200, but the City has not approved a higher budget, then the $100 is still divided among the houses and the tax rate decreases by 1/2 to 0.5% and the amount of taxes paid remains the same. Final budgets will come out this summer.

I thought my valuation could not increase more than 10% from year to year?

That’s partly correct. This is known as the “Homestead Cap”. IF you have a homestead exemption on your property, the assessed market value on the tax letter may be more than a 10% increase since last year. However – read further down in the letter you received and there should be a Net Tax Appraisal amount. This should have only increased by no more than 10%. This is what will be multiplied by the tax rate to determine how much you’ll pay. Note: It does not go into affect until the January 1st after you qualify. Ex. You purchase a home on December 20, 2021. You qualify for homestead exemption on Jan. 1 2022 so the “Homestead Cap” does not take affect until Jan. 1 2023.

What are my options going forward?

#1 MAKE SURE YOU HAVE FILED A HOMESTEAD EXEMPTION

You can file a late application for a homestead exemption up to 2 YEARS AFTER the delinquency date (typically February 1st) or FIVE  YEARS AFTER for disabled veterans. File before April 30 to have the exemption for the current year. You can qualify for the exemption starting the January 1st after you purchase the property.

#2 PROTEST THE TAX APPRAISED MARKET VALUE

If you have EVIDENCE to why the value is higher than it should be, you have the right to protest this amount. The form can be found on the County Appraisal District Website. Or you can visit this link to download. Deadline to file is May 15.

#4 PARTNER WITH YOUR LOCAL ELECTED OFFICIALS

Become aware of the different taxing districts to which you pay your taxes to and learn the pros and cons of the proposed BUDGET changes that affect your share of taxes. Most properties fall into these taxing districts: County and School District (and City if you are in city limits). There are other districts that may affect your tax rate (seen on your tax bill) such as a Community College, Public Improvement District, or Water District.

#3 VOTE FOR TEXAS PROP 2 THROUGH MAY 7

Vote YES for Texas Proposition 2 to increase the homestead exemption to $40,000 from the current $25,000. The change will apply to 2022 property taxes.

For questions about your tax letter or filing your protest, contact your local Appraisal District office. And remember – “If you want to gather honey, don’t kick over the beehive.” – Dale Carnegie

They are dealing with a lot of misinformed and ANGRY people right now. This is a nationwide issue not just in Potter / Randall County.

 

Resources:

Texas Comptrollers Website

More Appraisal FAQS

Potter / Randall Tax Exemptions

Property Tax Forms

Texas A&M Real Estate Article on Tax Appraisals

Understanding the Texas Property Tax System

Texas Proposition 2

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