Bill Text: TX HB455 | 2025-2026 | 89th Legislature | Introduced

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Bill Title: Relating to the establishment of a limitation on the total amount of ad valorem taxes that certain taxing units may impose on the residence homesteads of individuals who are disabled or elderly and their surviving spouses.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced) 2024-11-12 - Filed [HB455 Detail]

Download: Texas-2025-HB455-Introduced.html

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89R1118 CJC-D
By: Schofield H.B. No. 455

A BILL TO BE ENTITLED
AN ACT
relating to the establishment of a limitation on the total amount of
ad valorem taxes that certain taxing units may impose on the
residence homesteads of individuals who are disabled or elderly and
their surviving spouses.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Section 11.261, Tax Code, is
amended to read as follows:
Sec. 11.261. LIMITATION OF TAX IMPOSED BY TAXING UNIT OTHER
THAN SCHOOL DISTRICT [COUNTY, MUNICIPAL, OR JUNIOR COLLEGE DISTRICT
TAX] ON HOMESTEADS OF INDIVIDUALS WHO ARE DISABLED OR [AND]
ELDERLY.
SECTION 2. Section 11.261, Tax Code, is amended by amending
Subsections (a), (b), (c), (d), (e), (f), (g), (h), (i), (j), (k),
and (l) and adding Subsections (b-1) and (b-2) to read as follows:
(a) This section applies only to a taxing unit other than a
school district [county, municipality, or junior college district
that has established a limitation on the total amount of taxes that
may be imposed by the county, municipality, or junior college
district on the residence homestead of a disabled individual or an
individual 65 years of age or older under Section 1-b(h), Article
VIII, Texas Constitution].
(b) The tax officials shall appraise the property to which
this section [the limitation] applies and calculate taxes as on
other property, but if the tax so calculated exceeds the limitation
required [provided] by this section, the tax imposed by a taxing
unit is the amount of the tax as limited by this section, except as
otherwise provided by this section. A taxing unit [The county,
municipality, or junior college district] may not increase the
total annual amount of ad valorem taxes the taxing unit [county,
municipality, or junior college district] imposes on the residence
homestead of an individual who is [a] disabled [individual] or is
[an individual] 65 years of age or older above the amount of the
taxes the taxing unit [county, municipality, or junior college
district] imposed on the residence homestead in the first tax
year[, other than a tax year preceding the tax year in which the
county, municipality, or junior college district established the
limitation described by Subsection (a),] in which the individual
qualified that residence homestead for the exemption provided by
Section 11.13(c) for an individual who is [a] disabled [individual]
or is [an individual] 65 years of age or older. If the individual
qualified that residence homestead for the exemption after the
beginning of that first year and the residence homestead remains
eligible for the exemption for the next year, and if the [county,
municipal, or junior college district] taxes imposed by the taxing
unit on the residence homestead in the next year are less than the
amount of taxes imposed in that first year, the taxing unit [a
county, municipality, or junior college district] may not
subsequently increase the total annual amount of ad valorem taxes
it imposes on the residence homestead above the amount it imposed on
the residence homestead in the year immediately following the first
year[, other than a tax year preceding the tax year in which the
county, municipality, or junior college district established the
limitation described by Subsection (a),] for which the individual
qualified that residence homestead for the exemption.
(b-1) If the first tax year the individual qualified the
residence homestead for the exemption provided by Section 11.13(c)
for individuals who are disabled or are 65 years of age or older was
a tax year before the 2026 tax year and the homestead qualified for
a limitation on county, municipal, or junior college district taxes
under this section for that tax year, the amount of the limitation
on county, municipal, or junior college district taxes, as
applicable, required by this section is the amount of the tax
imposed by the applicable taxing unit for the 2025 tax year, plus
any 2026 tax attributable to improvements made in 2025, other than
improvements made to comply with governmental regulations or
repairs.
(b-2) Except as provided by Subsection (b-1), for the
purpose of calculating a limitation on tax increases by a taxing
unit under this section, an individual who qualified a residence
homestead before January 1, 2026, for an exemption under Section
11.13(c) for individuals who are disabled or are 65 years of age or
older is considered to have qualified the homestead for that
exemption on January 1, 2026.
(c) If an individual makes improvements to the individual's
residence homestead, other than repairs and other than improvements
required to comply with governmental requirements, the taxing unit
[county, municipality, or junior college district] may increase the
amount of taxes on the homestead in the first year the value of the
homestead is increased on the appraisal roll because of the
enhancement of value by the improvements. The amount of the tax
increase is determined by applying the current tax rate to the
difference between the appraised value of the homestead with the
improvements and the appraised value the homestead [it] would have
had without the improvements. The [A] limitation required
[provided] by this section then applies to the increased amount of
[county, municipal, or junior college district] taxes on the
residence homestead until more improvements, if any, are made.
(d) A limitation on [county, municipal, or junior college
district] tax increases by a taxing unit required [provided] by
this section expires if on January 1:
(1) none of the owners of the structure who qualify for
the exemption provided by Section 11.13(c) for an individual who is
[a] disabled [individual] or is [an individual] 65 years of age or
older and who owned the structure when the limitation [provided by
this section] first took effect is using the structure as a
residence homestead; or
(2) none of the owners of the structure qualifies for
the exemption provided by Section 11.13(c) for an individual who is
[a] disabled [individual] or is [an individual] 65 years of age or
older.
(e) If the appraisal roll provides for taxation of appraised
value for a prior year because a residence homestead exemption for
an individual who is disabled [individuals] or is [individuals] 65
years of age or older was erroneously allowed, the tax assessor for
the applicable taxing unit [county, municipality, or junior college
district] shall add, as back taxes due as provided by Section
26.09(d), the positive difference, if any, between the tax that
should have been imposed for that year and the tax that was imposed
because of the provisions of this section.
(f) A limitation on tax increases by a taxing unit required
[provided] by this section does not expire because the owner of an
interest in the structure conveys the interest to a qualifying
trust as defined by Section 11.13(j) if the owner or the owner's
spouse is a trustor of the trust and is entitled to occupy the
structure.
(g) Except as provided by Subsection (c), if an individual
who receives a limitation on [county, municipal, or junior college
district] tax increases by a taxing unit required [provided] by
this section subsequently qualifies a different residence
homestead [in the same county, municipality, or junior college
district] for an exemption under Section 11.13, a taxing unit [the
county, municipality, or junior college district] may not impose ad
valorem taxes on the subsequently qualified homestead in a year in
an amount that exceeds the amount of taxes the taxing unit [county,
municipality, or junior college district] would have imposed on the
subsequently qualified homestead in the first year in which the
individual receives that exemption for the subsequently qualified
homestead had the limitation on tax increases required [provided]
by this section not been in effect, multiplied by a fraction the
numerator of which is the total amount of taxes [the county,
municipality, or junior college district] imposed by a taxing unit
of the same type on the former homestead in the last year in which
the individual received that exemption for the former homestead and
the denominator of which is the total amount of taxes that [the
county, municipality, or junior college district] would have been
imposed by the taxing unit of the same type on the former homestead
in the last year in which the individual received that exemption for
the former homestead had the limitation on tax increases required
[provided] by this section not been in effect. A limitation under
this subsection does not apply to a taxing unit if the former
homestead was not subject to taxation by a taxing unit of the same
type in the last year in which the individual received the exemption
for the former homestead.
(h) An individual who receives a limitation on [county,
municipal, or junior college district] tax increases by a taxing
unit under this section and who subsequently qualifies a different
residence homestead [in the same county, municipality, or junior
college district] for an exemption under Section 11.13, or an agent
of the individual, is entitled to receive from the chief appraiser
of the appraisal district in which the former homestead was located
a written certificate providing the information necessary to
determine whether the individual may qualify for a limitation on
the subsequently qualified homestead under Subsection (g) and to
calculate the amount of taxes a taxing unit of the same type [the
county, municipality, or junior college district] may impose on the
subsequently qualified homestead.
(i) If an individual who receives [qualifies for] a
limitation on [county, municipal, or junior college district] tax
increases by a taxing unit under this section dies, the surviving
spouse of the individual is entitled to the limitation on taxes
imposed by the taxing unit [county, municipality, or junior college
district] on the residence homestead of the individual if:
(1) the surviving spouse is disabled or is 55 years of
age or older when the individual dies; and
(2) the residence homestead of the individual:
(A) is the residence homestead of the surviving
spouse on the date that the individual dies; and
(B) remains the residence homestead of the
surviving spouse.
(j) If an individual who is 65 years of age or older and
qualifies for a limitation on [county, municipal, or junior college
district] tax increases for the elderly under this section dies in
the first year in which the individual qualified for the limitation
and the individual first qualified for the limitation after the
beginning of that year, except as provided by Subsection (k), the
amount to which the surviving spouse's [county, municipal, or
junior college district] taxes are limited under Subsection (i) is
the amount of taxes imposed by the taxing unit to which the
limitation applies [county, municipality, or junior college
district, as applicable,] on the residence homestead in that year
determined as if the individual qualifying for the exemption had
lived for the entire year.
(k) If in the first tax year after the year in which an
individual who is 65 years of age or older dies under the
circumstances described by Subsection (j) the amount of taxes
imposed by a taxing unit [county, municipality, or junior college
district] on the residence homestead of the surviving spouse is
less than the amount of taxes imposed by the taxing unit [county,
municipality, or junior college district] in the preceding year as
limited by Subsection (j), in a subsequent tax year the surviving
spouse's taxes imposed by the taxing unit [county, municipality, or
junior college district] on that residence homestead are limited to
the amount of taxes imposed by the taxing unit [county,
municipality, or junior college district] in that first tax year
after the year in which the individual dies.
(l) Notwithstanding Subsection (d), a limitation on
[county, municipal, or junior college district] tax increases by a
taxing unit required [provided] by this section does not expire if
the owner of the structure qualifies for an exemption under Section
11.13 under the circumstances described by Section 11.135(a).
SECTION 3. Section 23.19(g), Tax Code, is amended to read as
follows:
(g) A tax bill or a separate statement accompanying the tax
bill to a cooperative housing corporation for which interests of
stockholders are separately appraised under this section must
state, in addition to the information required by Section 31.01,
the appraised value and taxable value of each interest separately
appraised. Each exemption claimed as provided by this title by a
person entitled to the exemption shall also be deducted from the
total appraised value of the property of the corporation. The total
tax imposed by a school district or other taxing unit [, county,
municipality, or junior college district] shall be reduced by any
amount that represents an increase in taxes attributable to
separately appraised interests of the real property and
improvements that are subject to the limitation of taxes prescribed
by Section 11.26 or 11.261. The corporation shall apportion among
its stockholders liability for reimbursing the corporation for
property taxes according to the relative taxable values of their
interests.
SECTION 4. Sections 26.012(6), (13), and (14), Tax Code,
are amended to read as follows:
(6) "Current total value" means the total taxable
value of property listed on the appraisal roll for the current year,
including all appraisal roll supplements and corrections as of the
date of the calculation, less the taxable value of property
exempted for the current tax year for the first time under Section
11.31 or 11.315, except that:
(A) the current total value for a school district
excludes:
(i) the total value of homesteads that
qualify for a tax limitation as provided by Section 11.26;
(ii) new property value of property that is
subject to an agreement entered into under former Subchapter B or C,
Chapter 313; and
(iii) new property value of property that
is subject to an agreement entered into under Subchapter T, Chapter
403, Government Code; and
(B) the current total value for a taxing unit
other than a school district [county, municipality, or junior
college district] excludes the total value of homesteads that
qualify for a tax limitation as provided by Section 11.261.
(13) "Last year's levy" means the total of:
(A) the amount of taxes that would be generated
by multiplying the total tax rate adopted by the governing body in
the preceding year by the total taxable value of property on the
appraisal roll for the preceding year, including:
(i) taxable value that was reduced in an
appeal under Chapter 42;
(ii) all appraisal roll supplements and
corrections other than corrections made pursuant to Section
25.25(d), as of the date of the calculation, except that last year's
taxable value for a school district excludes the total value of
homesteads that qualified for a tax limitation as provided by
Section 11.26 and last year's taxable value for a taxing unit other
than a school district [county, municipality, or junior college
district] excludes the total value of homesteads that qualified for
a tax limitation as provided by Section 11.261; and
(iii) the portion of taxable value of
property that is the subject of an appeal under Chapter 42 on July
25 that is not in dispute; and
(B) the amount of taxes refunded by the taxing
unit in the preceding year for tax years before that year.
(14) "Last year's total value" means the total taxable
value of property listed on the appraisal roll for the preceding
year, including all appraisal roll supplements and corrections,
other than corrections made pursuant to Section 25.25(d), as of the
date of the calculation, except that:
(A) last year's taxable value for a school
district excludes the total value of homesteads that qualified for
a tax limitation as provided by Section 11.26; and
(B) last year's taxable value for a taxing unit
other than a school district [county, municipality, or junior
college district] excludes the total value of homesteads that
qualified for a tax limitation as provided by Section 11.261.
SECTION 5. This Act applies only to ad valorem taxes imposed
for a tax year beginning on or after the effective date of this Act.
SECTION 6. This Act takes effect January 1, 2026, but only
if the constitutional amendment proposed by the 89th Legislature,
Regular Session, 2025, establishing a limitation on the total
amount of ad valorem taxes that certain political subdivisions may
impose on the residence homesteads of persons who are disabled or
elderly and their surviving spouses is approved by the voters. If
that amendment is not approved by the voters, this Act has no
effect.