79R5673 JD-D

By:  Leibowitz                                                    H.B. No. 2444



A BILL TO BE ENTITLED

AN ACT

relating to limiting the appraised value for ad valorem tax 
purposes of certain residence homesteads.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 23.23, Tax Code, is amended by amending 
Subsections (a) and (b) and adding Subsection (g) to read as 
follows:
	(a)  Except as provided by Subsection (g), the [The] 
appraised value of a residence homestead for a tax year may not 
exceed the lesser of:
		(1)  the market value of the property; or                                     
		(2)  the sum of:                                                              
			(A)  10 percent of the appraised value of the 
property for the last year in which the property was appraised for 
taxation times the number of years since the property was last 
appraised;
			(B)  the appraised value of the property for the 
last year in which the property was appraised; and
			(C)  the market value of all new improvements to 
the property.             
	(b)  When appraising a residence homestead, the chief 
appraiser shall:       
		(1)  appraise the property at its market value; and                           
		(2)  include in the appraisal records [both] the market 
value of the property, [and] the amount computed under Subsection 
(a)(2), and, if applicable, the appraised value determined under 
Subsection (g).
	(g)  This subsection applies only to a residence homestead 
that remains unsold after having been listed for sale and actively 
and continuously marketed for at least 12 months at an asking price 
that is equal to or less than the appraised value of the property 
for ad valorem tax purposes as otherwise determined under this 
chapter.  On written application by the owner of an eligible 
residence homestead, the chief appraiser shall reduce the appraised 
value of the residence homestead to the appraised value of the 
homestead for ad valorem tax purposes on January 1 of the fourth tax 
year preceding the year the homestead was first listed for sale.  
The chief appraiser shall continue to maintain the reduced value in 
the appraisal records until January 1 of the fifth tax year after 
the year in which the reduction was made.  To be valid, an 
application under this section must be signed and attested to by the 
owner of the residence homestead or the real estate agent marketing 
the property.  A limitation required by this subsection expires on 
January 1 of the first tax year in which the owner of the residence 
homestead ceases to own the property or ceases to qualify the 
property for an exemption under Section 11.13.  The comptroller by 
rule shall adopt forms and procedures to implement and enforce this 
subsection.  The rules shall establish standards or criteria for 
determining whether a residence homestead has been actively and 
continuously marketed in good faith for at least 12 months as 
required by this subsection.
	SECTION 2.  This Act applies only to a tax year that begins 
on or after the effective date of this Act.
	SECTION 3.  This Act takes effect January 1, 2006, but only 
if the constitutional amendment proposed by the 79th Legislature, 
Regular Session, 2005, to authorize the legislature to limit the 
appraised value for ad valorem tax purposes of a residence 
homestead that is offered for sale for a price at or below the 
appraised value and is not sold within a year of being offered for 
sale at that price is approved by the voters.  If that amendment is 
not approved by the voters, this Act has no effect.