A new proposal in Texas could bring down the homestead tax exemption by a decade—lowering property tax bills for those aged between 55 and 65 in the Lone Star State.
Lt. Governor Dan Patrick, a Republican, unveiled a major new property tax proposal on December 11 called Operation Double Nickel, aimed at easing the burden on older homeowners.
Why It Matters
Property taxes are a major source of funding for local governments in Texas and are collected by counties, cities, school districts, and special districts such as hospital or utility authorities. Unlike many states, Texas does not have a state property tax—all property taxes are set and used at the local level.
On average, Texas has one of the higher property tax burdens in the country. The effective property tax rate (meaning the amount paid as a percentage of a home’s value) is 1.58 percent, though rates vary widely by location. For a home valued at around $300,000, that translates to an annual property tax bill of about $4,790 before any exemptions.
What To Know
Under the plan, the age for the school district (ISD) senior homestead tax exemption would drop from 65 to 55. That change would allow Texans to lock in their school property tax values a decade earlier, giving homeowners over 55 more time with stable—and typically lower—tax bills.
Patrick’s office estimates the proposal would save about 3.3 million homeowners nearly $950 a year, adding up to roughly $16,000 in savings over a 10-year period. The freeze on taxable values would remain in place for as long as homeowners keep their property, offering long-term predictability.
The proposal would also provide broader relief, with benefits extending to all 6.1 million homestead owners statewide, regardless of age, the press release notes.
The proposal follows Governor Greg Abbott’s own plan, which shares the same goal but takes a different approach. Abbott’s proposal calls for limits on local government spending, requiring two-thirds voter approval for any tax increases, and a constitutional amendment to eliminate school property taxes on homesteads.
What People Are Saying
Lt. Governor Dan Patrick: “We’re going to take the senior homestead exemption down to 55. That means for an extra 10 years, from age 55 to 65, your values are frozen. You will never again have to worry about rising appraisals for school taxes.”
Governor Greg Abbott: “Texas homeowners want the abolishment of their school district property taxes. The time has passed to make that a reality. If you own a home in Texas, you should be able to afford to live in that home.”
What Happens Next
Patrick presented his proposal to the Texas Legislature and recommended that the proposal be considered during the next legislative session.