Texas Seniors Struggle with Property Taxes

The impact of property taxes is hard to underestimate. Lots of seniors in Texas have problems paying them. There are some options to avoid paying various property taxes meaning that some can feel less pressured. For example, people over 65 years old can count on a significant exemption when it comes to property taxes.

What’s important is that school property taxes do not increase if there were no renovations or changes of the ownership. However, even a small renovation of a kitchen or a bathroom will lead to the change of the exemption. On the other hand, you can still replace, repair, and renovate HVAC systems or roof and avoid an increase of the property tax.

Moving to another home is also not something terrible since the new home is taxed like the previous one. You can request the same percentage to be applied to the new home and avoid overpaying even if your new property is significantly more expensive. This is not a loophole, but it does present some opportunities to cut your expenses in the long run.

Note that in some counties in Texas the exemption can be bigger compared to other counties. For example, Houston and Harris Country offer much bigger exemptions to senior citizens. There is a special process called tax ceiling certification where you can receive a document that verifies your right to have an exemption.

The exemption rarely exceeds 20% of the market value determined by experts. This is exactly how much of an exemption you can expect in Houston and Harris. The exemption for seniors is substantial and equals to $160 thousand plus 20%. The problem is that about 50% of seniors still cannot pay that amount. The average price of a house in Houston is around $210 thousand making the exemption equal to $202 thousand.

This presents a very concerning situation for all people over 65. If an area grew quickly in terms of housing prices, the amount of taxes can be quite high for an elderlн person to handle. A normal sized house in West University can cost anywhere between $800 thousand and $1.2 million. However, it could be a very small purchase about 50 years ago. The problem is that only contemporary metrics are used to evaluate property and appropriate taxation.

Property taxes for a house that is evaluated at $1 million can easily reach $37 hundred after exemptions for a 65-year-old. There are some factors that reduce the pressure. As an example, a senior can defer a payment on a residence where they live. There will be an accumulating 8% interest, but seniors will avoid paying penalties and other complementary fees. Taxes will assessed while seniors do not necessarily have to pay them.

Another good thing is that even if a 65-year-old dies or moves out, a spouse (over 55) can hold on to exemptions and still defer taxes. There are various factors that determine the conditions of the deferral as well as the amount of taxes that a spouse must pay. However, most benefits can be retained.

There is more information about taxes in Texas that you read here. Learn more about taxation and how to avoid overpaying!

Leave a Reply

Your email address will not be published. Required fields are marked *