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How to Save Money with a Homestead Exemption in Texas

TAGS: TipsMortgage Costs

No one loves paying taxes - especially more than they have to! That’s why you should apply for a homestead exemption before April 30th of this year. Homestead exemptions lower the amount of home value you’re taxed on, and save money every year you live in your home.

What is a Homestead Exemption?

In Texas, the homestead exemption allows you to reduce the amount of property taxes you pay on your primary residence. While the amounts vary, here are the basic kinds of savings you can expect:

  • General homestead exemption (for school taxes): In Texas, the general homestead exemption available to most qualifying homeowners is worth $25,000. That means that a home valued at $175,000 will only be taxed on $150,000 of that value.
  • Over 65 or disabled exemptions: Those who qualify for one of these additional exemptions receive another $10,000 exemption on their taxable value. In this case, the house above is now taxed on just $140,000 of its value. You cannot qualify for both an over-65 and a disabled exemption.
  • County tax exemption: Some counties collect special taxes for flood control. If yours is one of those, you can receive an additional $3,000 exemption. Now your $175,000 home is only taxed like a $137,000 home!

Depending on the value of your home, those savings add up quickly. On that $175,000 home from our example above, we’re talking $450-$650 a year!

Who qualifies for a Homestead Exemption in Texas?

Here are the basics to know whether you qualify:

  • You own your home as of January 1 of this year.
  • The home you’re filing on is your primary residence as of January 1.
  • You do not claim a homestead exemption on any other property.
  • You're a surviving spouse of a fallen veteran, first-responder, or of an individual who qualified for the 65-or-over exemption.

You can read more about more ways to qualify and their details on the filing form.

How to File for a Homestead Exemption in Texas

First, download and complete a copy of the Application for Residential Homestead Exemption. The application is fairly straightforward with most people only needing a few pieces of information about themselves and the property to qualify for the general exemption. There are additional exemptions for disabled persons, surviving spouses of service members or first responders, and those over age 65. Refer to the application or your local tax appraisal district for help on those additional exemptions.

There is no fee to file.

Where to File for Your Homestead Exemption

When you’ve finished the application, take it to your local tax appraisal office with a copy of your driver’s license showing the address of the home. If you live in a county where one of our offices are located, we’ve collected some helpful contact info below.

And the best news is that you don’t have to reapply each year! Sometimes, the local tax appraiser may request a new application. But most often, your single filing is good for the duration of the time you spend in your new home. But don’t delay! Homestead exemptions must be filed by April 30. If you forget to file, you’ll be required to wait another year to start saving.

Remember, these are just guidelines and examples to get you started. Your tax savings could be higher than our example above since each circumstance is different. If you have questions about your specific situation, contact your local tax appraiser.