Texas Property Tax Law Changes 2025 and 2026: What Every Property Owner Needs to Know

The 89th Texas Legislature passed the most significant property tax reform package in years during its 2025 session. Governor Abbott signed the bills into law in June 2025. Here is what changed, what it means for your 2026 tax bill, and why you should still protest.

What Changed in 2025

SB 4 — School District Homestead Exemption Increase

• The mandatory school district homestead exemption increased from $100,000 to $140,000
• For the average Texas homeowner, this saves approximately $484 per year on school district taxes
• This applies automatically if your homestead exemption is already on file. No action needed.
• If you have never filed a homestead exemption, file now through your county appraisal district

SB 23 — Senior and Disabled Homeowner Exemption Increase

• Qualifying seniors (65+) and disabled homeowners now receive an additional $60,000 school district exemption
• Combined with the standard $140,000 exemption, qualifying homeowners now have $200,000 in school district exemptions
• This also applies automatically if the over-65 or disability exemption is already on file

HB 8 — Temporary School Tax Rate Cut

• A one-year school district tax rate reduction of $0.0331 per $100 of assessed value
• For a home assessed at $400,000, this saves approximately $132 in the first year
• This is a one-year measure and does not carry forward automatically

HB 1533 — ARB Evidence Transparency

• Appraisal districts must now share their evidence with you 14 days before your ARB hearing
• This is a significant change, previously you would not see the district’s evidence until the day of the hearing
• With advance notice of what the district will argue, you can prepare specific counterarguments

Why You Should Still Protest in 2026

The 2025 legislative changes are meaningful but they do not fix an over-assessed property value. Here is why:

• Exemptions reduce your taxable value by a fixed dollar amount. A protest reduces your appraised value, the number the exemptions are subtracted from. Both matter.
• A $140,000 exemption on a home over-assessed by $50,000 still means you are paying taxes on $50,000 more than you should be.
• A successful protest lowers your baseline permanently, compounding savings year over year. The 2025 rate cuts do not do this.

What Did Not Change

• The May 15 protest deadline = unchanged
• The no-cost-to-protest rule = filing still cannot raise your value
• The right to protest annually = guaranteed under Texas Tax Code Section 41.41
• Commercial property caps = the SB 2 circuit breaker (20% cap for non-homestead properties under $5M) from 2023 is still in effect through 2026 as a pilot program

What did the 2025 Texas property tax legislation change?

The 89th Texas Legislature passed SB 4 (raising the school district homestead exemption from $100,000 to $140,000), SB 23 (adding a $60,000 supplemental exemption for seniors and disabled homeowners), HB 8 (a one-year school tax rate cut of $0.0331 per $100), and HB 1533 (requiring appraisal districts to share evidence 14 days before ARB hearings). Governor Abbott signed these bills in June 2025.

Do I need to do anything to get the new $140,000 homestead exemption?

No. If you already have a homestead exemption on file with your county appraisal district, the increase from $100,000 to $140,000 applies automatically for the 2025 tax year and forward. You do not need to reapply. If you have never filed a homestead exemption, file now, over 20 percent of eligible Texas homeowners have not claimed theirs.

Does the new homestead exemption replace the need to protest?

No. The homestead exemption reduces your taxable value by a fixed amount. A protest reduces your appraised value, which is the number the exemption is applied to. If your appraised value is too high, the exemption alone does not correct that. Protesting and claiming your exemption work together, you need both for the maximum savings.

What is HB 1533 and how does it help property owners?

HB 1533 requires Texas appraisal districts to provide property owners with the evidence they plan to use at an ARB hearing at least 14 days before the hearing. Previously, property owners often saw the district’s evidence for the first time on the day of the hearing. With advance notice, you or your representative can prepare specific rebuttals to the district’s comparable sales, income analysis or cost approach before walking into the room.

Is the 20% non-homestead appraisal cap still in effect?

Yes. The circuit breaker provision from Senate Bill 2 (2023), which limits annual appraised value increases to 20% for non-homestead properties valued under $5 million, remains in effect through the 2026 tax year as a pilot program. This benefits commercial property owners, investors, and landlords whose properties might otherwise see larger single-year increases in fast-appreciating markets.

Ready to Lower Your Texas Property Taxes?

The May 15th deadline is approaching. Resolute’s team of former appraisal district insiders is ready to fight for every dollar you deserve.