Understanding Your Property Tax Bill & Your Exemptions
Plain-English guide for Texas homeowners · Updated for the 2026 tax year
You've opened your appraisal notice or tax bill and the number looks bigger than it should. Before anything else, know two things: the value on that notice is an opinion, not a verdict — you have the right to protest it — and exemptions may already be cutting your bill by six figures of taxable value. Here's how it all fits together.
How your bill is actually calculated
Taxable value × tax rate = your tax. Each taxing unit — your school district, county, and city — takes your home's appraised value, subtracts the exemptions that apply to that unit, and multiplies what's left by its rate. That's why one home produces several different taxable values on the same bill.
The exemptions every Texas homeowner should know (2026)
| Exemption | What it does |
|---|---|
| General Homestead | Takes $140,000 off your home's value for school taxes — raised from $100,000 by Texas voters in November 2025. Applies to your primary residence. File once; it's free. |
| Over-65 or Disabled | An extra $60,000 off for school taxes (that's $200,000 total), plus your school taxes are frozen — they can go down but never up. A surviving spouse 55+ keeps both. |
| Local-Option | Your county or city may knock off up to 20% more. Travis County, for example, takes 20% off plus over $140,000 more for seniors on its portion of the bill. |
| Disabled Veteran | $5,000–$12,000 off any one property, based on your VA rating. Veterans rated 100% (or unemployable): your homestead is completely exempt — a $0 bill. |
| 10% Homestead Cap | Not an exemption, but just as important: once you have a homestead exemption, your assessed value can't rise more than 10% a year, no matter what the market does. |
| Business Property | New for 2026: the first $125,000 of business equipment and inventory is exempt — up from just $2,500. |
| Solar & Wind | Installed solar panels? The entire value the system adds to your home is exempt — but only if you file Form 50-123. Many owners with recent installs are taxed on it by mistake. |
| Agricultural ("Ag Exemption") | Qualifying farm, ranch, timber, or wildlife-management land is taxed on its productivity value instead of market value — often a 90%+ reduction. Requires ag use for 5 of the last 7 years at your county's intensity standards. |
| Surviving Spouses | Spouses of service members or first responders killed in the line of duty receive a complete homestead exemption. |
| Charitable, Religious & More | Churches, charities, private schools, historic structures, pollution-control equipment, and goods shipped out of state within 175 days ("freeport") each have their own full or partial exemptions. |
Every exemption above has its own eligibility rules and application form — and most can be filed retroactively if missed. If any row sounds like your situation, ask us; checking costs nothing.
Where the protest comes in
Exemptions lower your bill by formula. A protest lowers the appraised value itself — the number everything else is calculated from. Every year, appraisal districts value hundreds of thousands of homes by mass computer models, and every year many come in high. Texas law (Tax Code §41.41) gives you the right to challenge that value — and we handle the entire process for you.
The two work together: the exemption is your permanent discount; the protest corrects the sticker price. Doing both is how you pay only what's fair.
Three things to check on your notice right now
1. Is your homestead exemption showing? If the exemption line is blank and you live in the home, you're overpaying — and you can claim it retroactively for up to two years.
2. Did the market value jump? Compare this year's appraised value to last year's. Big jump, no renovation? That's protest material.
3. Are you 65, disabled, or a veteran? If any of these happened since you last filed, additional exemptions — and the school tax freeze — are waiting on a one-page form.
Free estimate. No fee unless we actually lower your taxes.