Texas Home Owners Property Tax Credit If you have real estate property in Texas and are considering purchasing, you might want to look into what is the homestead exemption in Texas. This can be beneficial for first-time homebuyers or owners looking to sell. There are a couple of different ways to qualify for this tax benefit in Texas. Find out which option is best for you.
Texas Residential Homestead Exemption This state, a state of Texas gives a property tax credit for property bought within it. The homestead exemption is also known as the property tax exclusion and it benefits homeowners in some areas. A percentage of the total value in your house is taken off in property taxes. You can claim an exemption on your tax returns for up to two years, but that starts to phase out if you move out of Texas within those two years. For those who own a year-round residence in Texas, this homestead exemption allows you to depreciate the value of your house each year and claim a tax deduction for it.
No Property Taxes If your property is worth less than what the Texas homestead exemption amount is you will not have to pay any property taxes. This makes this an attractive option for first time home buyers or investors looking to lower their tax liability. When the homestead exemption and property value are equal, the Texas tax assessor will issue a certificate showing the property’s taxable value. The tax assessor will use this number to determine the amount of the homestead exemption you are entitled to in Texas.
Annual Refinancing Applying for homestead exemptions in Texas does require an application but it is relatively easy to qualify for and the process is much less intensive than filing a tax refinance in many other states. There are also some ways to reduce the tax liability by increasing the homestead exemption amount, for example, increasing the length of time you own your property or getting rid of exemptions on some property that has grown in value. These exemptions are renewable each year and cannot be reduced. It is the obligation of the property owner to pay for these exemptions on their own, but they can be purchased at any tax appraisal sale. Applying for exemptions online is the best way to get started with your homestead exemption request.
Who gets What is Homestead? Texas has a unique homestead exemption system based on marital status. If a married couple owns a homesteaded home, their exemption is doubled for each child, regardless of whether they live permanently with their parents. Children do not receive a homestead exemption if they live away from their parents for at least five years. The same is true for children who are adopted. However, parents with multiple children are given the opportunity to apply for a homestead exemption on one property and their subsequent children receive an exemption for each separate property owned by them.
How can I Protect My Homestead? One of the best protections that a homeowner can obtain is through filing a lawsuit against anyone who would violate his or her homestead rights. An experienced attorney with a successful record of winning cases on homestead protection issues will be well familiar with the laws and procedures of local courts and can help to protect the homestead rights of clients in foreclosure situations and other civil suits. You can hire a lawyer who specializes in Texas homestead laws to help protect your homestead rights in foreclosure cases.