Unlike some states that impose income taxes, Texas relies heavily on property taxes to fund local services, including schools, public safety, and infrastructure.
DALLAS — A new WalletHub study ranked Texas among the best states to start a business in 2025, and one property tax consulting firm is urging business property owners — established and new — to be ready come assessment time.
For business and commercial property owners in Texas, property taxes can be a significant financial obligation. Unlike some states that impose income taxes, Texas relies heavily on property taxes to fund local services, including schools, public safety, and infrastructure.
As a result, commercial property tax rates can be high, and understanding how properties are assessed is crucial — especially for the thousands of new businesses that have and plan to move into the Lone Star State, according to Ryan Chismark, a property tax consultant and partner with Meritax Advisors.
In Texas, property taxes are based on the appraised value of the property, as determined by the county appraisal district. Given the hot-and-cold nature of the real estate market, the value of a commercial property can fluctuate, leading to changes in tax liabilities from year to year.
The Dallas-Fort Worth Metroplex has experienced significant business growth, with new developments and corporate relocations driving up property values. As businesses continue to expand in the region, Chismark says commercial property owners must stay informed about their property assessments to ensure they align with market trends. The rapid growth in DFW has also led to increased competition for commercial real estate, making accurate property valuations more important than ever.
“In Texas you have an assessment, you have a tax rate, and when you multiply them together you have a property tax liability,” Chismark said. “So if we’re just focusing on one component, we’re missing the context of the whole story, and what that ultimately means for school districts, municipalities, and communities in general… My job is to clarify those points.”
Chismark helps educate business and commercial property owners on how to take proactive steps by reviewing their annual property appraisal notices, comparing values to similar properties in the area, and identifying discrepancies in assessments. Keeping up with local real estate trends and market conditions also helps in assessing whether the appraised value is fair and accurate.
Meanwhile, the Texas Legislature is currently considering several proposals that could directly or indirectly effect business property owners.
Gov. Greg Abbott has advocated for raising the business personal property tax exemption to $100,000 to ease the burden on small businesses.
Senate Bill 4 (SB 4) proposes increasing the homestead exemption for school property taxes to $140,000 for homeowners and $150,000 for seniors. While primarily benefiting residential property owners, this measure could indirectly impact commercial property owners by altering the overall tax landscape.
Legislation is also underway to restrict housing finance corporations (HFCs) from granting property tax exemptions to private developers outside their jurisdictions. This aims to prevent out-of-state investors from exploiting tax breaks, which have previously shifted the tax burden onto local taxpayers, including commercial property owners.
