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A BILL TO BE ENTITLED
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AN ACT
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relating to the authority of the governing body of a taxing unit to |
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adopt an exemption from ad valorem taxation of a portion, expressed |
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as a dollar amount, of the appraised value of an individual's |
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residence homestead and to the adjustment of the exemption amount |
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in subsequent years to reflect inflation. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 11.13(n), Tax Code, is amended to read as |
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follows: |
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(n) In addition to any other exemptions provided by this |
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section, an individual is entitled to an exemption from taxation by |
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a taxing unit of a portion, expressed as a dollar amount, [a |
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percentage] of the appraised value of the individual's [his] |
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residence homestead if the exemption is adopted by the governing |
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body of the taxing unit before July 1 in the manner provided by law |
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for official action by the body. For the 2026 tax year, the amount |
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of the exemption may not exceed $100,000. For each subsequent tax |
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year, the comptroller shall calculate the maximum amount of the |
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exemption by multiplying the maximum amount of the exemption under |
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this subsection for the preceding tax year by the inflation rate and |
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adding that amount to the maximum amount of the exemption for the |
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preceding tax year. Each year, not later than March 15, the |
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comptroller shall publish the maximum amount of the exemption in |
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the Texas Register. For purposes of this subsection, "inflation |
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rate" means the positive amount, if any, expressed in decimal form |
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rounded to the nearest thousandth, computed by determining the |
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percentage change in the Consumer Price Index for all Urban |
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Consumers (CPI-U), U.S. City Average, published by the Bureau of |
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Labor Statistics of the United States Department of Labor for the |
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preceding calendar year as compared to the calendar year preceding |
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that calendar year. [If the percentage set by the taxing unit |
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produces an exemption in a tax year of less than $5,000 when applied |
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to a particular residence homestead, the individual is entitled to |
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an exemption of $5,000 of the appraised value. The percentage |
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adopted by the taxing unit may not exceed 20 percent.] |
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SECTION 2. Section 11.13(n-1), Tax Code, is repealed. |
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SECTION 3. This Act applies only to ad valorem taxes imposed |
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for a tax year that begins on or after the effective date of this |
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Act. |
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SECTION 4. This Act takes effect January 1, 2026, but only |
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if the constitutional amendment proposed by the 89th Legislature, |
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Regular Session, 2025, authorizing the governing body of a |
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political subdivision to adopt an exemption from ad valorem |
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taxation of a portion, expressed as a dollar amount, of the market |
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value of an individual's residence homestead and providing for the |
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adjustment of the exemption amount in subsequent years to reflect |
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inflation is approved by the voters. If that amendment is not |
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approved by the voters, this Act has no effect. |