Saving money on your property taxes can feel like an uphill battle, but there’s one way you can do it that takes almost no time: filing your Homestead Tax Exemption. If you’re a home owner and you haven’t been filing your homestead exemption then you could be missing out on hundreds of dollars that belong in your pocket!

Don’t worry! Nail & Key is here to clear any confusion and make it as quick and easy as brushing your teeth (we’ll get to that in the video below).


Why Do We Pay Property Taxes?

If you’re a homeowner, you pay a property tax every year—but you may not know why you pay the amount that you do. So how are your property taxes determined? It comes down to three major factors: the value of your home based on the housing market, the improvements you’ve made to the property since the last valuation, and the city’s property tax rate. That third factor can feel a little baffling to homeowners who may not know exactly how the city determines the tax rate or why it may be higher than it was a few years ago.

The property tax rate is based on how much funding is needed to support the budget and growth/decline of the city. This determination is made by the local government, and sometimes without public consent. If you live in a city that’s booming, the odds are high that the needs of your city will grow, too. But unless you’ve got a finger on the pulse of the projected growth and statistics and budget needs of your neck of the woods, the determination of your property taxes can seem opaque and subjective.

And it is fairly subjective! The housing market is unpredictable, which means the city is playing a bit of a guessing game when they estimate the value of your home. If they lower the property tax rate too much to compensate for the higher property values and then the market happens to nose dive, they will run into some real budget issues. Unfortunately, this means that they sometimes have a tendency to overvalue properties, asking for forgiveness instead of permission—a headache for all parties. It’s also worth mentioning that they don’t assess the value every year, so a property could depreciate but maintain the same value on paper as the year before. If you feel your property has been overvalued, it may be worth it to appeal your valuation, and it’s always worth finding out if you qualify for tax exemptions like the Homestead Tax Exemption.

What Is A Homestead Tax Exemption?

According to the Texas A&M University Real Estate Center,

“The primary purpose [of the homestead tax exemption] originally was to encourage settlement. Additionally, homestead law protects the home and some means of support, thus keeping families off the public dole, fostering independence, and preserving the integrity of the family as the basic unit of society. Texas homestead provisions fall into three general categories: the homestead exemption from taxation, homestead protection from creditors, and the homestead right of occupancy.”

Basically, this exemption exists to reward homeowners who actually live on their own properties, and takes a certain percentage of your property’s value off of the taxable amount. You can only file one homestead tax exemption on a property that you own and reside in.

For example, if the assessed value of your home is $200,000 and your property tax rate is 1%, your property tax bill would equal $2,000. But if you were eligible for a homestead tax exemption of $50,000, the taxable value of your home would drop to $150,000, meaning your tax bill would drop to $1,500.

Pretty cool, right?

The only catch is that you have a deadline of April 30th to file your exemption, so don’t sleep on it. It takes all of a few minutes to fill out, so file today!

How Can I File My Homestead Tax Exemption?

Nail & Key is here to help you! One of our favorite agents, Austin Wyble, put together a PSA on how to file your Homestead Tax Exemption. We’ve even made it easy to find your county’s exemption form. Just click the button and it’s ready to print and fill out. If you don’t see your county listed, just reach out and we’ll get you squared away.

Thanks For Visiting.

Overall, we understand that the opportunity to save money on taxes can be huge for a family, so be sure to file yours before it’s too late. In the meantime, we’ll do our best to help keep you informed on all the ways to make home ownership as enjoyable as it should be.