Texas property owners pay billions of dollars every year in property taxes. Because Texas doesn’t have a state income tax, property taxes are a primary way local communities fund essential services—public schools, police, fire departments, roads, and more. The system is straightforward on paper, but in real life it can feel confusing (and expensive), especially when home values rise.
Here’s a clear, homeowner-friendly breakdown of how Texas property taxes work, how your value is determined, and the practical ways many Texans reduce what they owe—through exemptions and protesting an overvalued appraisal.
How Texas Property Taxes Are Calculated
Your total tax bill comes down to two numbers:
Market Value × Tax Rate = Total Property Tax Due
Both numbers are controlled locally:
- Your property’s market value is set by your county appraisal district.
- Your local tax rates are set by the taxing entities that serve your property (school district, city, county, special districts, etc.).
Tax rates can change from year to year, and large increases generally require voter approval under Texas “truth-in-taxation” rules.
The County Appraisal Process (Why Values Change)
Texas law requires appraisal districts to appraise property at market value as of January 1 each year. Appraisal districts must have a reappraisal plan and generally must reappraise properties at least once every three years (many areas effectively reassess annually depending on their plan and market activity).
Because counties are valuing thousands (or millions) of properties, most use a mass appraisal system—standardized methodology using sales and property data. This is efficient, but it can also be imperfect, which is why some homeowners receive values that don’t match their home’s real-world condition or true market value.
Common Residential Valuation Approaches
County appraisers typically rely on two core methods:
1) The sales approach (“sales argument”)
This compares your home to similar homes that sold recently. In fast-moving markets, this can produce values that feel inflated—especially if the “comps” aren’t truly comparable.
2) The equity approach (“equity argument”)
This compares your valuation to how the county valued other similar homes in your neighborhood, not just homes that sold. If your home is valued higher than similar nearby homes without justification, that’s a potential equity issue.
Commercial properties may also be valued using an income approach, which estimates value based on the property’s income and expenses—what an investor would likely pay based on expected returns.
Your Right to Protest Your Appraised Value (Texas Deadlines Matter)
Every Texan has the legal right to protest their county’s appraised value each year.
Most homeowners receive a Notice of Appraised Value in the spring. If you believe the value is incorrect, you can file a protest—but you must hit the deadline.
Two Critical Texas Property Tax Deadlines
- Protest deadline: typically May 15, or 30 days after the notice of appraised value is mailed, whichever is later. This deadline is strict.
- Payment deadline: January 31 (tax bills are typically mailed in November/December). Late payments can trigger penalties and interest.
Understanding “Appraised Value” vs. “Assessed Value”
One thing that trips homeowners up: your property can have multiple “values,” and they can all be correct—because they’re used for different purposes.
For property taxes, the two that matter most are:
- Tax Appraised Value (Market Value): what the county believes your home would sell for.
- Tax Assessed Value: the value you’re actually taxed on after exemptions and caps are applied.
When your assessed value is lower than your appraised value, that usually means your exemptions (like homestead) are helping reduce your taxable burden.
Also important: Texas protest efforts typically focus on lowering the appraised (market) value. In many cases, lowering appraised value helps lower what you pay—though in very hot markets, exemption caps can change how much immediate relief you feel.
Lowering Property Taxes with Exemptions
Exemptions are one of the most powerful ways to reduce property taxes because they remove part of your home’s value from taxation before the tax bill is calculated.
Common exemptions include:
- Homestead exemption
- Over-65 exemption
- Disabled homeowner exemptions
- Disabled veteran exemptions
- Agricultural valuation/exemptions (where applicable)
Texas voters also approved additional property tax relief measures in November 2025, including increases targeted to certain homeowner groups (such as elderly and disabled homeowners), helping reduce tax burdens for many Texans.
Lowering Property Taxes by Protesting (DIY vs. Hiring a Pro)
Many homeowners can lower their tax bill by protesting an inaccurate appraisal. Historically, reductions vary widely based on the market and the specific errors in the appraisal, but even a modest value adjustment can mean real savings—especially when combined with exemptions.
If You Protest Yourself, Here’s What It Typically Involves
You’ll generally need to:
- File the required protest paperwork before the deadline
- Gather public and (when available) non-public data
- Identify issues using the sales and/or equity method
- Attend an informal meeting (optional) and/or a formal hearing
- Negotiate with an experienced county appraiser and present your evidence to the ARB (Appraisal Review Board)
It can take weeks to months and meaningful prep time to do it well. Many homeowners choose to work with a professional tax protest firm to avoid the time commitment and to lean on established experience and negotiation.
Texas Tax Rates: Why They Change (and Where to Track Them)
Taxing entities (school districts, cities, counties, etc.) set tax rates based on budgets. Texas “truth-in-taxation” rules are designed to increase transparency and limit how quickly taxing entities can increase revenue without triggering a public vote.
If you want to stay ahead of proposed rates, budget hearings, and local notices, the Texas Property Tax Transparency website is a helpful tool for tracking what’s being proposed in your area.
Paying Your Tax Bill (and How Escrow Impacts Monthly Payments)
If you pay your taxes directly, remember that tax bills typically arrive November/December and are due January 31.
If your mortgage lender pays property taxes through an escrow account, your lender will pay the bill—but your monthly payment can change each year based on:
- The prior year’s tax bill
- The lender’s estimate of next year’s bill
- Any escrow shortage/overage adjustments
That’s why many homeowners see their mortgage payment rise even if their interest rate doesn’t change.
Final Thoughts (and a Simple Way to Start Saving)
Texas property taxes are a fact of life—but overpaying doesn’t have to be. Understanding how values are set, tracking deadlines, applying for exemptions, and protesting when necessary can make a real difference.
If you’re a homeowner in Katy, Richmond, or the surrounding Houston-area communities and you want to keep more of your hard-earned money, I can help point you in the right direction.
Ready to stop overpaying your Texas property taxes? I’ve proudly partnered with Home Tax Shield to help my clients challenge potentially inflated valuations and reduce their tax burden.
Sign up here: https://hometaxshield.proptax.app/partners/evan-hitch
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Evan Hitch
Evan Hitch Property Group | Southern Trust Realty
281-400-0414 | evanhitch.com