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Homestead Exemptions: What You Should Know!

It’s Time to Apply for Your Homestead Exemption!

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Wondering what homestead exemptions are and/or want to know how to apply? Check out these FAQs:

WHAT IS A HOMESTEAD EXEMPTION?

Homestead exemptions removes part of your home’s value from taxation. If you want to receive a homestead exemption for the taxes on your home, the home must first qualify as a residence homestead on January 1 of the year in which you are applying.

There are two requirements:
  1. You must own your home on Jan. 1. (If you are over 65, and/or disable, the January 1 ownership and residency are not required.)
  2. You must use the home as your principal residence on Jan. 1.

To qualify, you must own the home on Jan. 1 for the year you are applying for. Additionally, you must file the form and additional information by April 30 of that year. For more information, contact your local county appraisal district.

WHAT DO YOU NEED TO APPLY FOR A HOMESTEAD APPLICATION?
  • Filled out APPLICATION FOR RESIDENTIAL HOMESTEAD EXEMPTION (available on websites of most county appraisal districts – see below for county links)
  • Copy of DRIVER’S LICENSE or IDENTIFICATION CARD from the Texas Department of Public Safety at www.txdps.state.tx.us. The address MUST MATCH the homestead address.
    • A state law that took effect on Sept. 1, 2013, has changed proof of residency requirements for homeowners applying for the property tax homestead exemption.
    • It’s VITAL that home buyers update their address on their driver’s license and with the tax assessor/collector in their area in order to be able to provide the required documentation for the homestead exemption.

The new requirements also apply to applications for the over 65, disability, disabled veterans, homeowner’s surviving spouse and manufactured (mobile) home exemptions. They do not apply to homeowners who already have homestead exemptions.

WHY SHOULD I APPLY FOR A HOMESTEAD EXEMPTION?

Homestead exemptions remove part of your home’s value from taxation, so they lower your taxes – saving you money.

For example, your home is appraised at $100,000, and you qualify for a $25,000 exemption (this is the amount mandated for school districts), you will pay school taxes on the home as if it was worth only $75,000. Taxing units have the option to offer a separate exemption of up to 25 percent of the total value.

WHAT IS A HOMESTEAD?

A homestead can be a separate structure, condominium or a manufactured home located on owned or leased land, as long as the individual living in the home owns it. A homestead can include up to 20 acres, if the land is owned by the homeowner and used as a yard or for another purpose related to the residential use of the homestead.

DO ALL HOMES QUALIFY FOR EXEMPTIONS?

No. Only a homeowner’s principal residence qualifies. To qualify, a home must meet the definition of a residence homestead: The home’s owner must be an individual (for example: not a corporation or other business entity) and use the home as his or her principal residence on Jan. 1 of the tax year. Finally, if you are age 65 or older, the Jan. 1 ownership is not required for the age 65 homestead exemption.

WHAT HOMESTEAD EXEMPTIONS ARE AVAILABLE?

There are several types of exemptions you may receive.

  • School taxes: All residence owners may receive a $25,000 exemption from their home’s value for school taxes.
  • County taxes: If a county collects a special tax for farm-to-market roads or flood control, a residence owner may receive a $3,000 exemption for this tax. If the county grants an optional exemption for home owners aged 65 or older or are disabled, the owners will receive only the local-option exemption.
  • Age 65 or older and/or disabled exemptions: Individuals 65 and older and/or disabled residence homestead owners may qualify for a $10,000 homestead exemption for school taxes, in addition to the $25,000 exemption for all home owners. If the owner qualifies for both the $10,000 exemption for 65 and older home owners and the $10,000 exemption for disabled homeowners, the owner must choose one or the other for school taxes. The owner cannot receive both exemptions.
  • Optional percentage exemptions: Any taxing unit – including a city, county, school or special district – may offer an exemption of up to 25 percent of a home’s value. But, no matter what the percentage is, the amount of an optional exemption cannot be less than $5,000. Each taxing unit decides if it will offer the exemption and at what percentage. This percentage exemption is also added to any other home exemption for which an owner qualifies. The taxing unit must decide before July 1 of the tax year to offer this exemption.
  • Optional 65 or older or disabled exemptions: Finally, any taxing unit may offer an additional exemption amount of at least $,000 for taxpayers aged 65 or older and/or disabled.
DOES IT COST TO SUBMIT YOUR APPLICATION FOR EXEMPTION?

No, although some companies will mail information out saying they will file the exemption form for a fee. BUT it does not cost you anything to file for the exemption.

I BOUGHT MY HOUSE MORE THAN A YEAR AGO. CAN I STILL APPLY?

Yes, you can apply anytime between Jan. 1 and April 30 as long as you also meet the qualifications of applying for the exemption.

Information deemed reliable but not guaranteed. Source website: www.window.state.tx.us/taxinfo/proptax/exmptns.html

COUNTY APPRAISAL DISTRICTS WEBSITES

Collin County Appraisal District

Dallas County Appraisal District

Denton County Appraisal District

Ellis County Appraisal District

Rockwall County Appraisal District

Tarrant County Appraisal District

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