Seems like with all of the chatter about the increased appraised values of homes and resulting increase in property tax, I don't think many people realize that the appraised valuation increase on your residential homestead is capped at a 10% increase from the previous year. At least that is my understanding. However, It seems like counties just appraise homesteads without regard to the cap and leave it to homeowners to challenge it - happened to me a few years ago and I didn't catch it until too late (11% increase). Be sure you have filed your homestead exemption too. I'm guessing this is what many of these property tax services are going to rely on to file protests. And I'm further guessing it won't be that hard to protest this yourself. I haven't dug into this too much yet since haven't received my appraisal. There might be some exceptions or hoops to jump through, but hopefully the info will be helpful to some of you. And I assume if your homestead value increases 25% each year for 3 years the taxable value would still be capped at a 30% total increase over the 3 years instead of 75%. If the county doesn't cap the appraisal themselves then if you forget one year to protest or don't have homestead exemption filed then you will get hit with the full value increase. Someone with more experience in this area may need to correct me on all of this or add to it. Here's the statute

https://statutes.capitol.texas.gov/Docs/TX/htm/TX.23.htm

TAX CODE

TITLE 1. PROPERTY TAX CODE

SUBTITLE D. APPRAISAL AND ASSESSMENT

CHAPTER 23. APPRAISAL METHODS AND PROCEDURES

Sec. 23.23. LIMITATION ON APPRAISED VALUE OF RESIDENCE HOMESTEAD. (a) Notwithstanding the requirements of Section 25.18 and regardless of whether the appraisal office has appraised the property and determined the market value of the property for the tax year, an appraisal office may increase the appraised value of a residence homestead for a tax year to an amount not to exceed the lesser of:
(1) the market value of the property for the most recent tax year that the market value was determined by the appraisal office; or
(2) the sum of:
(A) 10 percent of the appraised value of the property for the preceding tax year;
(B) the appraised value of the property for the preceding tax year; and
(C) the market value of all new improvements to the property.
(b) When appraising a residence homestead, the chief appraiser shall:
(1) appraise the property at its market value; and
(2) include in the appraisal records both the market value of the property and the amount computed under Subsection (a)(2).
(c) The limitation provided by Subsection (a) takes effect as to a residence homestead on January 1 of the tax year following the first tax year the owner qualifies the property for an exemption under Section 11.13. The limitation expires on January 1 of the first tax year that neither the owner of the property when the limitation took effect nor the owner's spouse or surviving spouse qualifies for an exemption under Section 11.13.
(c-1) For purposes of Subsection (c), an owner who receives an exemption as provided by Section 11.42(f) is considered to have qualified the property for the exemption as of January 1 of the tax year following the tax year in which the owner acquired the property.
(d) This section does not apply to property appraised under Subchapter C, D, E, F, or G.
(e) In this section, "new improvement" means an improvement to a residence homestead made after the most recent appraisal of the property that increases the market value of the property and the value of which is not included in the appraised value of the property for the preceding tax year. The term does not include repairs to or ordinary maintenance of an existing structure or the grounds or another feature of the property.
(f) Notwithstanding Subsections (a) and (e) and except as provided by Subdivision (2), an improvement to property that would otherwise constitute a new improvement is not treated as a new improvement if the improvement is a replacement structure for a structure that was rendered uninhabitable or unusable by a casualty or by wind or water damage. For purposes of appraising the property under Subsection (a) in the tax year in which the structure would have constituted a new improvement:
(1) the appraised value the property would have had in the preceding tax year if the casualty or damage had not occurred is considered to be the appraised value of the property for that year, regardless of whether that appraised value exceeds the actual appraised value of the property for that year as limited by Subsection (a); and
(2) the replacement structure is considered to be a new improvement only if:
(A) the square footage of the replacement structure exceeds that of the replaced structure as that structure existed before the casualty or damage occurred; or
(B) the exterior of the replacement structure is of higher quality construction and composition than that of the replaced structure.
(g) In this subsection, "disaster recovery program" means the disaster recovery program administered by the General Land Office or by a political subdivision of this state that is funded with community development block grant disaster recovery money authorized by federal law. Notwithstanding Subsection (f)(2), and only to the extent necessary to satisfy the requirements of the disaster recovery program, a replacement structure described by that subdivision is not considered to be a new improvement if to satisfy the requirements of the disaster recovery program it was necessary that:
(1) the square footage of the replacement structure exceed that of the replaced structure as that structure existed before the casualty or damage occurred; or
(2) the exterior of the replacement structure be of higher quality construction and composition than that of the replaced structure.

I agree with evestor1, I think everyone active here knows this.

Quote:

---

However, It seems like counties just appraise homesteads without regard to the cap and leave it to homeowners to challenge it - happened to me a few years ago and I didn't catch it until too late (11% increase).

---

But not sure I understand this. At least in Harris County, this isn't happening. You have two clear values, one is appraised and one is market. The county appraisers are setting your market value, that can go up by any percent, 20, 30, 40, +%. Your appraised is what you're paying taxes on and it, by default, is capped at a 10% increase from the previous year if you have your HE.

So, unless other counties do it completely differently, not sure how they are raising it above 10% and you have to catch it and fight it.

Only caveat would be if they aren't applying your HE even though you have one.

htxag09 said:

---

I agree with evestor1, I think everyone active here knows this.

Quote:

---

However, It seems like counties just appraise homesteads without regard to the cap and leave it to homeowners to challenge it - happened to me a few years ago and I didn't catch it until too late (11% increase).

---

But not sure I understand this. At least in Harris County, this isn't happening. You have two clear values, one is appraised and one is market. The county appraisers are setting your market value, that can go up by any percent, 20, 30, 40, +%. Your appraised is what you're paying taxes on and it, by default, is maxed at a 10% increase from the previous year if you have your HE.

So, unless other counties do it completely differently, not sure how they are raising it above 10% and you have to catch it and fight it.

Only caveat would be if they aren't applying your HE even though you have one.

---

Yeah, I've never seen them do this. I'm in Collin County. They show my market value, and then the appraised value, which was reduced to the 10% cap, same as last year. There is even a note next to the Appraised Value stating "possible homestead limitations". And I believe the appraisal notices are fairly standard and are required by law to contain certain information. I have a hard time believing that what the OP is describing is a widespread problem. I have heard occasional stories of some homeowners not having their HS applied by mistake, but that appeared to be easily corrected with a phone call to the CAD.

Everyone (almost) knows and understands the process. It doesn't make it any less bull*****

When you buy a new home, does the county get a one time opportunity to raise appraised value by more than 10%? In other words can they raise it by a large amount bc your homestead hasn't kicked in yet?

mavsfan4ever said:

---

When you buy a new home, does the county get a one time opportunity to raise appraised value by more than 10%? In other words can they raise it by a large amount bc your homestead hasn't kicked in yet?

---

When you purchase a home, the appraised value gets reset to the market value. Your homestead cap gets applied to that appraised value going forward.

Well, damn. Thanks.

Ours went up around 80%. But not sure we can really fight it bc of what we paid and bc of renovations.

Did you tell the CAD what you paid for your house? We've been in our house for four years and this year our tax assessed value finally caught up to what we paid for it. Also, the "market value" is still about 300K less than what I could actually sell it for. ie, true market value.

Every county is different. In Harris County, for example, you're highly unlikely to find someone who's value is $380k less than the CAD's market value. They are aggressive at keeping up, this year many saw 30+% increases to keep up.

True.
My market value, per the CAD went up 36%. And even with that huge increase is still way behind what the house could sell for. Tax assessed only went up 10%

mavsfan4ever said:

---

When you buy a new home, does the county get a one time opportunity to raise appraised value by more than 10%? In other words can they raise it by a large amount bc your homestead hasn't kicked in yet?

---

I hear ya. We bought last year, so we are uncapped this year. Appraisal is up 2.25X from last years appraised value. We paid about halfway between the two, so I'm hoping they honor our closing price but who knows.