Texas property tax is a local tax, not a state tax, and the rate depends on where your property sits
Texas has no state income tax, but it does have property tax. The state does not set a single rate that applies everywhere. Instead, each county, school district, city, and special district (like a water or fire district) sets its own tax rate. This means your property tax bill depends on which taxing units have jurisdiction over your address — and those vary widely across the state.
The tax is calculated by multiplying your property's assessed value by the combined tax rate of all the taxing units that serve your location. A homeowner in one county might pay 0.6% of their home's value annually, while a homeowner in another county pays 1.2% or more. The variation is real and substantial.
Key Takeaways
- Texas property tax rates are set locally by counties, school districts, cities, and special districts, so the rate you pay depends on your address.
- Your tax bill is calculated by taking your property's assessed value and multiplying it by the combined tax rate of all taxing units serving your location.
- Homestead exemptions can reduce the assessed value of your primary residence, lowering your annual bill by hundreds or thousands of dollars.
- Property tax bills are due by January 31 each year, and you can protest the assessed value of your property through your county appraisal district.
How the assessed value is determined
The county appraisal district, not the county tax assessor's office, determines what your property is worth for tax purposes. This assessed value is usually based on recent sales of similar properties in your area, not on what you paid for your home or what a real estate agent says it is worth today.
The appraisal district sends you a notice of appraised value, usually in April or May. This is not your final bill — it is the value the district proposes to use. You have the right to challenge it if you believe the value is too high. Many homeowners do not know this step exists, but it is one of the few ways to reduce your tax bill without waiting for property values to fall.
Homestead exemptions and other reductions
If your home is your primary residence, you may be may have access to to a homestead exemption. This exemption reduces the assessed value used to calculate your school district taxes. The amount varies by school district — some reduce the value by $25,000, others by $50,000 or more. A few school districts offer a 20% reduction instead of a flat dollar amount.
Homestead exemptions do not apply to city or county taxes, only to school district taxes. You must file for the exemption with your county appraisal district, usually by April 30 of the year you want it to take effect. If you own your home outright or have a mortgage, you are generally may be able to access. If you rent, you do not receive a homestead exemption.
Homeowners age 65 or older, disabled homeowners, and surviving spouses of military members may may have access to for additional exemptions or tax deferrals. These programs vary by county and school district, so contact your appraisal district to learn what is available in your area.
When and how to pay your property tax bill
Property tax bills are due by January 31 each year. The bill is sent by your county tax assessor-collector's office, not by the appraisal district. If you have a mortgage, your lender may pay the tax from an escrow account, so you may not see the bill directly.
You can pay online, by mail, or in person at the tax assessor-collector's office. If you pay late, penalties and interest accrue quickly — typically 1.5% per month. Some counties offer payment plans if you cannot pay the full amount by the deadline. Contact your county tax assessor-collector's office to ask about options.
Protesting your appraised value
If you receive your notice of appraised value and believe it is too high, you can file a protest with your county appraisal district. The deadline to protest is usually May 15, though it varies by county — check your notice or your appraisal district's website for the exact date.
You do not need a lawyer or an appraiser to file a protest. You can submit a written statement explaining why you think the value is wrong, or you can request an informal hearing where you present your case to an appraiser. Bring evidence: recent sales of similar homes, photos of damage or needed repairs, or a professional appraisal if you have one. Many people win their protests by showing that comparable homes sold for less than the appraised value.
If you disagree with the appraisal district's decision, you can appeal to the Appraisal Review Board (ARB), a panel of local property owners who hear disputes. This step is also free and does not require a lawyer.
Tax rates vary significantly by location
Texas property tax rates are published by each taxing unit and combined on your bill. A typical breakdown might look like this: school district 1.0%, county 0.35%, city 0.25%, and special districts 0.1%, for a total of 1.7%. But in another part of the state, the same categories might total 0.8% or 2.2%.
School districts account for the largest share of most property tax bills — usually 40% to 50% of the total. Counties, cities, and special districts make up the rest. If you are considering moving within Texas, comparing property tax rates between locations can reveal significant differences in your annual cost of ownership.
What happens if you do not pay
If your property tax bill goes unpaid for an extended period, the county can place a lien on your property. After a certain time — usually three years — the county may sell your property at a tax sale to recover the unpaid taxes. This is rare for homeowners who are current on their mortgage, because lenders pay the tax from escrow to protect their investment. But if you own your home outright or fall behind on both your mortgage and taxes, this risk is real.
If you are struggling to pay, contact your county tax assessor-collector's office immediately. Some counties offer payment plans, tax deferrals for seniors, or other relief options. Waiting until a lien is filed makes the situation much harder to resolve.
Frequently Asked Questions
Can I deduct Texas property taxes on my federal income tax return?
Yes, but only up to $10,000 per year in total state and local taxes (SALT). This limit applies to all state income taxes, property taxes, and sales taxes combined. Most Texas homeowners can deduct their full property tax bill because Texas has no state income tax, but the $10,000 cap may apply if your property tax bill is very high.
What is the difference between appraised value and market value?
Appraised value is what the county appraisal district says your property is worth for tax purposes, based on comparable sales. Market value is what your property would actually sell for today. They are often close, but not always. If your home needs repairs or sits in a declining neighborhood, the market value may be lower than the appraised value — which is grounds for a protest.
Do I have to pay property tax if I own my home outright?
Yes. Property tax is owed by anyone who owns real property in Texas, whether the property is paid off or financed. If you have a mortgage, your lender collects the tax from your escrow account and pays it for you. If you own the home outright, you are responsible for paying the bill directly.
Can I get a property tax exemption if I rent my home out?
No. Homestead exemptions are only for primary residences. If you rent the property to tenants, you do not may have access to. You will pay the full tax rate on the full appraised value. Some landlords are able to deduct property taxes as a business expense on their federal return, but that is separate from state exemptions.
What if I disagree with the Appraisal Review Board's decision?
You can file a lawsuit in district court to challenge the ARB's decision, but you must do so within 45 days of the ARB's order. This step usually requires a lawyer and can be expensive. Most people accept the ARB's decision or work with the appraisal district to negotiate a settlement before the ARB hearing.