If you’re a homeowner in Texas, you’ll be excited to hear that a new law went into effect on January 1. You can now file for the homestead exemption in the same year you bought your home! So, if you buy a house in May of 2022, you may start saving money on your taxes immediately. The home must be your principal residence, and you have to own it, but you don’t have to wait until the following year to take advantage of this tax break. Let’s look at the new 2022 Texas homestead tax exemption laws and see how this affects you as a homeowner.
What is a Homestead Tax Exemption in Texas?
A homestead exemption in TX lowers your home’s value to lower your taxes. So, if your home appraises at $100,000 and you have a $50,000 homestead exemption, you will only pay taxes on $50,000 instead of $100,000. The amount of money you save depends on the tax rate in your area and which tax exemptions you qualify for.
Some of the exemptions many homestead owners receive include:
- School taxes: You receive a $40,000 residence homestead exemption from your home’s value for school taxes.
- County taxes: $3,000 exemption for any special taxes.
- Age 65+ and Disabled Exemptions: If you are age 65+ or disabled (or both), you qualify for an extra $10,000 residence homestead exemption on school taxes
- Optional Percentage Exemptions: Any city, county, school, or special district, may offer an exemption of up to 20% of a home’s value. But, no matter what your percentage is, your optional exemption won’t be less than $5,000. The taxing entity adds your percentage exemption to the other home exemptions you qualify for.
- Optional Age 65+ or Disabled Exemptions: An additional exemption amount of at least $3,000 for taxpayers age 65+ and disabled (or both). (1)
Qualifying & Applying for a Homestead Tax Exemption
According to the state, “A residence homestead can be a separate structure, condominium, or manufactured home located on owned or leased land, as long as the individual living in the home owns it. A residence homestead can include up to 20 acres if the land is owned by the homeowner and used for a purpose related to the residential use of the homestead.” (1)
To qualify for a new homestead exemption in Texas, the property must be:
- Your primary residence
- Purchased on or after January 01, 2022
- Owned by you
- Occupied by you
You can apply for a homestead exemption in Texas by:
- Visiting your county’s appraisal district office
- Filling out an application form
- Providing proof of ownership and occupancy, such as a deed or lease
- You will need to reapply for a homestead exemption in Texas every year.
- Ensure you renew your driver’s license with your new correct address to qualify.
New Rule Beginning in 2022: Receive Prorated Credit
You may still qualify for a prorated exemption if you move during the year. For example, if you move away from a homestead exemption home in May, you can qualify for the exemption for January through April.
If you move into a new home, you can apply for an exemption on the new home instead of the old home. However, you may only claim one homestead exemption for one house per year. How much money you save depends on the tax rate in your area.
You don’t always receive the prorated homestead exemption though. If someone else has already claimed the home you live in for that tax year, you do not qualify for the homestead exemption for that property that year. However, you may be eligible for the exemption on a different home for that year.
You can find out if the previous owner’s claimed the exemption already by calling your county’s appraisal district office. If you have any other questions about the homestead exemption in Texas, you can contact your county’s appraisal district office. They can help you with the application process and answer any questions you may have.
When Should You Apply for a Homestead Exemption?
You can apply for a homestead exemption as soon as you close on your home. However, you will need to provide proof of ownership and occupancy, such as a deed or lease. If you don’t have these documents yet, you can still apply for the exemption, but you’ll need to provide them when they become available.
You can find the application form on your county’s appraisal district website. Once you’ve filled it out, you can submit it online, by mail, or in person at your local appraisal district office.
Can I Still File for the 2022 Exemption?
You can still file for the homestead exemption for the year 2022. The official deadline to file for a homestead exemption is April 30. However, you can file for the residence homestead exemption up to two years after the delinquency date (usually Feb. 1).
We Can Help
At Jarrett Law, our focus on real estate law brings answers to any legal issues related to your home or taxes. Our experience in texas homestead law means we keep up with the latest changes and can help you understand how they may affect you. In addition, we are here for you if your struggles involve:
- HOAs
- Appealing your tax value in a protest
- Foreclosures and short sales
- Home inspection disputes
- Civil suits against sellers or buyers who defrauded you
- Mortgage contract negotiations
- and more!
Give us a call today to discuss your case. Find out how we can help you understand the laws in your area and help you come out on top!
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