Texas Property Taxes

Who sets and collects property taxes in Texas?

Local governments set and collect property taxes in Texas. The state has no property tax of its own. The money pays for local services such as schools, roads, police and fire protection.

Several local taxing units can tax the same home. Counties and school districts tax all property in their area that isn't exempt. You may also pay taxes to a city and to special districts, such as a hospital, junior college or water district.

Each taxing unit's governing body decides how much tax to raise and sets its own rate. Many of them, but not all, have the county tax assessor-collector collect the tax for them.

Source: Texas Comptroller of Public Accounts, "Property Tax System Basics"

What does the appraisal district do?

The appraisal district in your county sets your property's value as of January 1 each year. Who owns the property on that date, and the market, decide whether it's taxable, its taxable value and who pays the tax.

The appraisal district also handles exemption applications. An exemption can take all or part of a property's value out of taxation. The appraisal district doesn't set your property taxes, and neither does its review board.

The appraisal review board is a group of local citizens. It hears disputes between owners and the appraisal district about a property's value and whether it's taxable.

Sources: Texas Comptroller of Public Accounts, "Property Tax System Basics"; Texas Comptroller of Public Accounts, "Appraisal Protests and Appeals"

How do appraisal notices and protests work?

An appraisal notice tells you the value the appraisal district set for your property. The district must send one in some cases, such as when your value goes up from last year. A protest is how you challenge that value with the appraisal review board.

The Tax Code sets the notice date as April 1 for a single-family home that qualifies for a homestead exemption. For other property, it's May 1. Either way, the notice may come as soon as practical after that date.

The notice explains how to protest. You file a written protest with the appraisal review board by May 15 or the 30th day after the notice was delivered to you, whichever is later.

You can ask for an informal meeting with the appraisal district to try to settle the protest before the board's hearing. If you disagree with the board's decision, you can appeal to the state district court in your county. Some owners can choose binding arbitration or the State Office of Administrative Hearings instead.

Sources: Texas Comptroller of Public Accounts, "Appraisal Protests and Appeals"; Texas Legislature, "TAX CODE CHAPTER 25. LOCAL APPRAISAL (Section 25.19, Notice of Appraised Value)"; Texas Legislature, "TAX CODE CHAPTER 41. LOCAL REVIEW (Section 41.44, Notice of Protest)"

When are Texas property tax bills due?

Texas property taxes are due when you get the bill. They become delinquent if they aren't paid before February 1 of the next year. The Tax Code has some exceptions, such as for certain people on active military duty.

The tax assessor mails bills by October 1, or as soon as practical after that.

On February 1, penalty and interest charges start on most unpaid tax bills, the Texas Comptroller says.

Sources: Texas Comptroller of Public Accounts, "Property Tax System Basics"; Texas Legislature, "TAX CODE CHAPTER 31. COLLECTIONS (Sections 31.01 and 31.02)"

How does escrow work for property taxes on a mortgage?

An escrow account lets you pay property taxes and insurance a little at a time, with each monthly mortgage payment. Your mortgage servicer then pays those bills for you. Your lender sets up the account, and some places call it an impound account.

Many lenders require you to pay taxes and insurance through escrow, so they can make sure the bills get paid. Sometimes the law requires escrow too.

Property taxes and insurance costs can change from year to year. When they do, your escrow payment and your total monthly payment change too.

Without an escrow account, you pay these bills yourself. The CFPB says that if property taxes go unpaid, your state or local government may charge fines and penalties or put a tax lien on your home.

Source: Consumer Financial Protection Bureau, "What is an escrow or impound account?"