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A BILL TO BE ENTITLED
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AN ACT
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relating to the authority of a taxing unit other than a school |
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district, county, municipality, or junior college district to |
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establish a limitation on the amount of ad valorem taxes that the |
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taxing unit may impose on the residence homesteads of individuals |
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who are disabled or elderly and their surviving spouses and to the |
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information required to be included in a tax bill. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter B, Chapter 11, Tax Code, is amended by |
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adding Section 11.262 to read as follows: |
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Sec. 11.262. LIMITATION OF TAX IMPOSED BY CERTAIN TAXING |
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UNITS ON HOMESTEADS OF INDIVIDUALS WHO ARE DISABLED OR |
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ELDERLY. (a) In this section: |
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(1) "Eligible individual" means an individual who |
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meets any income eligibility requirements for a limitation on tax |
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increases provided by this section prescribed by the qualifying |
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taxing unit that established the limitation. If the qualifying |
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taxing unit does not prescribe income eligibility requirements for |
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the limitation on tax increases provided by this section, an |
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eligible individual is any individual who is otherwise eligible for |
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the limitation provided by this section. |
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(2) "Qualifying taxing unit" means a taxing unit other |
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than a school district, county, municipality, or junior college |
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district. |
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(3) "Residence homestead" has the meaning assigned by |
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Section 11.13. |
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(b) This section applies only to a qualifying taxing unit |
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that establishes a limitation under Section 1-b(h-1), Article VIII, |
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Texas Constitution, on the total amount of taxes that may be imposed |
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by the taxing unit on the residence homestead of an eligible |
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individual who is disabled or is 65 years of age or older. |
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(c) The governing body of a qualifying taxing unit that |
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establishes a limitation on tax increases provided by this section |
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may elect to provide the limitation to all individuals who are |
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disabled or are 65 years of age or older or to provide the |
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limitation only to those individuals who are disabled or are 65 |
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years of age or older and who meet certain income eligibility |
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requirements established by the governing body. If the governing |
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body establishes income eligibility requirements for the |
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limitation on tax increases provided by this section, those |
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requirements must be based on an individual having a household |
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income that does not exceed 200 percent of the federal poverty |
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level. For purposes of income eligibility requirements established |
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under this subsection, if an individual's household income was |
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initially determined using only the income of the individual and |
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the individual's spouse, on the death of the individual or the |
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individual's spouse, the surviving spouse's household income must |
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be calculated as though two persons still reside in the household. |
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(d) The tax officials shall appraise the residence |
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homestead of an eligible individual who is disabled or is 65 years |
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of age or older and calculate taxes on that residence homestead in |
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the same manner as other residence homesteads, but if the tax so |
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calculated exceeds the limitation provided by this section, the tax |
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imposed is the amount of the tax as limited by this section, except |
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as otherwise provided by this section. |
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(e) A qualifying taxing unit may not increase the total |
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annual amount of ad valorem taxes the taxing unit imposes on the |
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residence homestead of an eligible individual who is disabled or is |
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65 years of age or older above the amount of the taxes the taxing |
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unit imposed on the residence homestead in the first tax year in |
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which the eligible individual qualified that residence homestead |
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for the exemption provided by Section 11.13(c) for an individual |
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who is disabled or is 65 years of age or older and was an eligible |
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individual. If the eligible individual qualified that residence |
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homestead for the exemption after the beginning of that first year |
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and the residence homestead remains eligible for the exemption for |
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the next year, and if the taxes imposed by the taxing unit on the |
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residence homestead in the next year are less than the amount of |
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those taxes imposed in that first year, the taxing unit may not |
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subsequently increase the total annual amount of ad valorem taxes |
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it imposes on the residence homestead above the amount it imposed on |
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the residence homestead in the year immediately following the first |
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year for which the individual qualified that residence homestead |
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for the exemption and was an eligible individual. |
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(f) If an eligible individual who is disabled or is 65 years |
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of age or older makes improvements to the individual's residence |
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homestead, other than repairs and other than improvements required |
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to comply with governmental requirements, the qualifying taxing |
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unit may increase the amount of taxes on the homestead in the first |
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year the value of the homestead is increased on the appraisal roll |
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because of the enhancement of value by the improvements. The |
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amount of the tax increase is determined by applying the current tax |
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rate of the qualifying taxing unit to the difference between the |
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appraised value of the homestead with the improvements and the |
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appraised value the homestead would have had without the |
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improvements. The limitation provided by this section then |
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applies to the increased amount of taxes on the residence homestead |
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until more improvements, if any, are made. |
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(g) A limitation on tax increases provided by this section |
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expires if on January 1: |
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(1) none of the owners of the structure who qualify for |
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the exemption provided by Section 11.13(c) for an individual who is |
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disabled or is 65 years of age or older and who owned the structure |
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when the limitation first took effect are using the structure as a |
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residence homestead; |
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(2) none of the owners of the structure qualify for the |
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exemption provided by Section 11.13(c) for an individual who is |
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disabled or is 65 years of age or older; or |
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(3) none of the owners of the structure are eligible |
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individuals. |
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(h) If the appraisal roll provides for taxation of appraised |
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value for a prior year because a residence homestead exemption for |
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an eligible individual who is disabled or is 65 years of age or |
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older was erroneously allowed or because an individual was |
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erroneously considered to be an eligible individual, the tax |
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assessor for the applicable county shall add, as back taxes due as |
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provided by Section 26.09(d), the positive difference, if any, |
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between the tax that should have been imposed for that year and the |
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tax that was imposed under the requirements of this section. |
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(i) A limitation on tax increases provided by this section |
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does not expire because the owner of an interest in the structure |
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conveys the interest to a qualifying trust as defined by Section |
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11.13(j) if the owner or the owner's spouse is a trustor of the |
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trust and is entitled to occupy the structure. |
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(j) Except as provided by Subsection (f), if an eligible |
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individual who receives a limitation on tax increases provided by |
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this section, including a surviving spouse who receives a |
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limitation under Subsection (l), subsequently qualifies a |
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different residence homestead in the same qualifying taxing unit |
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for an exemption under Section 11.13, the taxing unit may not impose |
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ad valorem taxes on the subsequently qualified homestead in a year |
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in an amount that exceeds the amount of taxes the taxing unit would |
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have imposed on the subsequently qualified homestead in the first |
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year in which the individual receives that exemption for the |
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subsequently qualified homestead had the limitation on tax |
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increases required by this section not been in effect, multiplied |
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by a fraction the numerator of which is the total amount of taxes |
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imposed on the former homestead by the taxing unit in the last year |
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in which the individual received that exemption for the former |
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homestead and the denominator of which is the total amount of taxes |
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that would have been imposed on the former homestead by the taxing |
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unit in the last year in which the individual received that |
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exemption for the former homestead had the limitation on tax |
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increases provided by this section not been in effect. |
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(k) An eligible individual who receives a limitation on tax |
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increases under this section, including a surviving spouse who |
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receives a limitation under Subsection (l), and who subsequently |
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qualifies a different residence homestead for an exemption under |
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Section 11.13, or an agent of the individual, is entitled to receive |
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from the chief appraiser of the appraisal district in which the |
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former homestead was located a written certificate providing the |
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information necessary to determine whether the individual may |
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qualify for a limitation on the subsequently qualified homestead |
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under Subsection (j) and to calculate the amount of taxes the |
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qualifying taxing unit may impose on the subsequently qualified |
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homestead. |
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(l) If an eligible individual who qualifies for a limitation |
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on tax increases under this section dies, the surviving spouse of |
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the individual is entitled to the limitation on taxes imposed by the |
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qualifying taxing unit on the residence homestead of the individual |
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if: |
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(1) the surviving spouse: |
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(A) is disabled or is 55 years of age or older |
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when the individual dies; and |
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(B) is an eligible individual; and |
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(2) the residence homestead of the individual: |
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(A) is the residence homestead of the surviving |
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spouse on the date that the individual dies; and |
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(B) remains the residence homestead of the |
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surviving spouse. |
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(m) If an eligible individual who is 65 years of age or older |
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and qualifies for a limitation on tax increases for the elderly |
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under this section dies in the first year in which the individual |
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qualified for the limitation and the individual first qualified for |
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the limitation after the beginning of that year, except as provided |
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by Subsection (n), the amount to which the surviving spouse's taxes |
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are limited under Subsection (l) is the amount of taxes imposed by |
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the qualifying taxing unit on the residence homestead in that year |
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determined as if the individual qualifying for the exemption had |
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lived for the entire year. |
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(n) If in the first tax year after the year in which an |
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eligible individual who is 65 years of age or older dies under the |
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circumstances described by Subsection (m), the amount of taxes |
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imposed by the qualifying taxing unit on the residence homestead of |
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the surviving spouse is less than the amount of taxes imposed by the |
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taxing unit in the preceding year as limited by Subsection (m), in a |
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subsequent tax year the surviving spouse's taxes imposed by the |
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taxing unit on that residence homestead are limited to the amount of |
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taxes imposed by the taxing unit in that first tax year after the |
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year in which the individual dies. |
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(o) Notwithstanding Subsection (g), a limitation on tax |
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increases provided by this section does not expire if the owner of |
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the structure qualifies for an exemption under Section 11.13 under |
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the circumstances described by Section 11.135(a). |
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(p) Notwithstanding Subsections (d) and (f), an improvement |
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to property that would otherwise constitute an improvement under |
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Subsection (f) is not treated as an improvement under that |
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subsection if the improvement is a replacement structure for a |
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structure that was rendered uninhabitable or unusable by a casualty |
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or by wind or water damage. For purposes of appraising the |
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property in the tax year in which the structure would have |
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constituted an improvement under Subsection (f), the replacement |
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structure is considered to be an improvement under that subsection |
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only if: |
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(1) the square footage of the replacement structure |
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exceeds that of the replaced structure as that structure existed |
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before the casualty or damage occurred; or |
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(2) the exterior of the replacement structure is of |
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higher quality construction and composition than that of the |
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replaced structure. |
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(q) An heir property owner who qualifies heir property as |
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the owner's residence homestead under this chapter is considered |
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the sole owner of the property for the purposes of this section. |
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(r) The chief appraiser for an appraisal district in which a |
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qualifying taxing unit participates may require an individual to |
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provide any information that is reasonably necessary for the chief |
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appraiser to determine whether the individual is an eligible |
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individual for purposes of this section. |
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SECTION 2. Sections 23.19(b) and (g), Tax Code, are amended |
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to read as follows: |
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(b) If an appraisal district receives a written request for |
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the appraisal of real property and improvements of a cooperative |
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housing corporation according to the separate interests of the |
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corporation's stockholders, the chief appraiser shall separately |
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appraise the interests described by Subsection (d) if the |
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conditions required by Subsections (e) and (f) have been |
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met. Separate appraisal under this section is for the purposes of |
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administration of tax exemptions, determination of applicable |
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limitations of taxes under Section 11.26, [or] 11.261, or 11.262, |
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and apportionment by a cooperative housing corporation of property |
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taxes among its stockholders but is not the basis for determining |
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value on which a tax is imposed under this title. A stockholder |
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whose interest is separately appraised under this section may |
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protest and appeal the appraised value in the manner provided by |
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this title for protest and appeal of the appraised value of other |
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property. |
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(g) A tax bill or a separate statement accompanying the tax |
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bill to a cooperative housing corporation for which interests of |
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stockholders are separately appraised under this section must |
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state, in addition to the information required by Section 31.01, |
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the appraised value and taxable value of each interest separately |
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appraised. Each exemption claimed as provided by this title by a |
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person entitled to the exemption shall also be deducted from the |
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total appraised value of the property of the corporation. The |
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total tax imposed by a taxing unit [school district, county, |
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municipality, or junior college district] shall be reduced by any |
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amount that represents an increase in taxes attributable to |
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separately appraised interests of the real property and |
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improvements that are subject to the limitation of taxes prescribed |
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by Section 11.26, [or] 11.261, or 11.262. The corporation shall |
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apportion among its stockholders liability for reimbursing the |
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corporation for property taxes according to the relative taxable |
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values of their interests. |
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SECTION 3. Sections 26.012(6), (13), and (14), Tax Code, |
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are amended to read as follows: |
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(6) "Current total value" means the total taxable |
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value of property listed on the appraisal roll for the current year, |
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including all appraisal roll supplements and corrections as of the |
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date of the calculation, less the taxable value of property |
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exempted for the current tax year for the first time under Section |
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11.31 or 11.315, except that: |
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(A) the current total value for a school district |
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excludes: |
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(i) the total value of homesteads that |
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qualify for a tax limitation as provided by Section 11.26; and |
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(ii) new property value of property that is |
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subject to an agreement entered into under Chapter 313; [and] |
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(B) the current total value for a county, |
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municipality, or junior college district excludes the total value |
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of homesteads that qualify for a tax limitation as provided by |
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Section 11.261; and |
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(C) the current total value for a taxing unit |
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other than a school district, county, municipality, or junior |
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college district excludes the total value of homesteads that |
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qualify for a tax limitation as provided by Section 11.262. |
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(13) "Last year's levy" means the total of: |
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(A) the amount of taxes that would be generated |
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by multiplying the total tax rate adopted by the governing body in |
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the preceding year by the total taxable value of property on the |
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appraisal roll for the preceding year, including: |
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(i) taxable value that was reduced in an |
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appeal under Chapter 42; |
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(ii) all appraisal roll supplements and |
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corrections other than corrections made pursuant to Section |
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25.25(d), as of the date of the calculation, except that: |
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(a) last year's taxable value for a |
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school district excludes the total value of homesteads that |
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qualified for a tax limitation as provided by Section 11.26; |
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(b) [and] last year's taxable value |
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for a county, municipality, or junior college district excludes the |
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total value of homesteads that qualified for a tax limitation as |
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provided by Section 11.261; and |
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(c) last year's taxable value for a |
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taxing unit other than a school district, county, municipality, or |
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junior college district excludes the total value of homesteads that |
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qualified for a tax limitation as provided by Section 11.262; and |
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(iii) the portion of taxable value of |
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property that is the subject of an appeal under Chapter 42 on July |
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25 that is not in dispute; and |
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(B) the amount of taxes refunded by the taxing |
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unit in the preceding year for tax years before that year. |
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(14) "Last year's total value" means the total taxable |
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value of property listed on the appraisal roll for the preceding |
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year, including all appraisal roll supplements and corrections, |
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other than corrections made pursuant to Section 25.25(d), as of the |
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date of the calculation, except that: |
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(A) last year's taxable value for a school |
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district excludes the total value of homesteads that qualified for |
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a tax limitation as provided by Section 11.26; [and] |
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(B) last year's taxable value for a county, |
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municipality, or junior college district excludes the total value |
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of homesteads that qualified for a tax limitation as provided by |
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Section 11.261; and |
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(C) last year's taxable value for a taxing unit |
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other than a school district, county, municipality, or junior |
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college district excludes the total value of homesteads that |
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qualified for a tax limitation as provided by Section 11.262. |
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SECTION 4. Section 31.01, Tax Code, is amended by adding |
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Subsection (m) to read as follows: |
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(m) The tax bill must include the appraisal district's |
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account number for the property. |
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SECTION 5. This Act applies only to ad valorem taxes imposed |
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for a tax year beginning on or after the effective date of this Act. |
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SECTION 6. This Act takes effect January 1, 2024, but only |
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if the constitutional amendment proposed by the 88th Legislature, |
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Regular Session, 2023, to authorize a limitation on the total |
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amount of ad valorem taxes that a political subdivision other than a |
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school district, county, municipality, or junior college district |
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may impose on the residence homesteads of persons who are disabled |
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or elderly and their surviving spouses is approved by the voters. |
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If that amendment is not approved by the voters, this Act has no |
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effect. |