Relating to providing for a reduction of the appraised value of a residence homestead for ad valorem tax purposes for the first tax year in which the owner qualifies the property for a residence homestead exemption based on the amount by which the limitation on increases in the appraised value of a residence homestead reduced the appraised value of the owner’s former residence homestead for the last tax year in which the owner qualified the former residence homestead for a residence homestead exemption.
relating to providing for a reduction of the appraised value of a
residence homestead for ad valorem tax purposes for the first tax
year in which the owner qualifies the property for a residence
homestead exemption based on the amount by which the limitation on
increases in the appraised value of a residence homestead reduced
the appraised value of the owner’s former residence homestead for
the last tax year in which the owner qualified the former residence
homestead for a residence homestead exemption.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 23.23, Tax Code, is amended by adding
Subsections (h), (i), and (j) to read as follows:
(h) The owner of a residence homestead who receives a
limitation provided by Subsection (a) on the owner’s residence
homestead and who subsequently qualifies a different property as
the owner’s residence homestead is entitled to a reduction in the
appraised value of the subsequently qualified homestead for the
first tax year in which the owner qualifies the subsequently
qualified homestead for an exemption under Section 11.13 in an
amount equal to the lesser of:
(1) the positive difference between the market value
and the appraised value of the former residence homestead for the
last tax year in which the owner qualified the former homestead for
an exemption under Section 11.13; or
(2) $500,000.
(i) An owner of a residence homestead who receives a
limitation provided by Subsection (a) on the owner’s residence
homestead and who subsequently qualifies a different property in a
different appraisal district as the owner’s residence homestead is
entitled to receive from the chief appraiser of the appraisal
district in which the former homestead was located a written
certificate necessary to determine whether the owner is entitled to
the reduction in the appraised value of the subsequently qualified
homestead provided by Subsection (h) and to calculate the amount of
the reduction.
(j) A residence homestead is considered to be a subsequently
qualified homestead for purposes of Subsection (h) only if the
first tax year in which the owner of the homestead qualified the
homestead for an exemption under Section 11.13 was a tax year
beginning on or after January 1, 2026.
SECTION 2. This Act applies only to the appraisal for ad
valorem tax purposes of residence homesteads for a tax year that
begins on or after the effective date of this Act.
SECTION 3. This Act takes effect January 1, 2026, but only
if the constitutional amendment proposed by the 89th Legislature,
Regular Session, 2025, to authorize the legislature to provide for
a reduction of the appraised value of a residence homestead for ad
valorem tax purposes for the first tax year in which the owner
qualifies the property for a residence homestead exemption based on
the amount by which the limitation on increases in the appraised
value of a residence homestead reduced the appraised value of the
owner’s former residence homestead for the last tax year in which
the owner qualified the former residence homestead for a residence
homestead exemption is approved by the voters. If that amendment is
not approved by the voters, this Act has no effect.
