Turner’s bill making local homestead exemption a flat dollar amount

The text as introduced · 497 words

89R9845 LHC-D

By: Turner
H.B. No. 3239

A BILL TO BE ENTITLED

AN ACT

relating to the authority of the governing body of a taxing unit to

adopt an exemption from ad valorem taxation of a portion, expressed

as a dollar amount, of the appraised value of an individual's

residence homestead and to the adjustment of the exemption amount

in subsequent years to reflect inflation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 11.13(n), Tax Code, is amended to read as

follows:

(n) In addition to any other exemptions provided by this

section, an individual is entitled to an exemption from taxation by

a taxing unit of a portion, expressed as a dollar amount, [ a

percentage ] of the appraised value of the individual's [ his ]

residence homestead if the exemption is adopted by the governing

body of the taxing unit before July 1 in the manner provided by law

for official action by the body. For the 2026 tax year, the amount

of the exemption may not exceed $100,000. For each subsequent tax

year, the comptroller shall calculate the maximum amount of the

exemption by multiplying the maximum amount of the exemption under

this subsection for the preceding tax year by the inflation rate and

adding that amount to the maximum amount of the exemption for the

preceding tax year. Each year, not later than March 15, the

comptroller shall publish the maximum amount of the exemption in

the Texas Register. For purposes of this subsection, "inflation

rate" means the positive amount, if any, expressed in decimal form

rounded to the nearest thousandth, computed by determining the

percentage change in the Consumer Price Index for all Urban

Consumers (CPI-U), U.S. City Average, published by the Bureau of

Labor Statistics of the United States Department of Labor for the

preceding calendar year as compared to the calendar year preceding

that calendar year. [ If the percentage set by the taxing unit

produces an exemption in a tax year of less than $5,000 when applied

to a particular residence homestead, the individual is entitled to

an exemption of $5,000 of the appraised value. The percentage

adopted by the taxing unit may not exceed 20 percent. ]

SECTION 2. Section 11.13(n-1), Tax Code, is repealed.

SECTION 3. This Act applies only to ad valorem taxes imposed

for a tax year that begins on or after the effective date of this

Act.

SECTION 4. This Act takes effect January 1, 2026, but only

if the constitutional amendment proposed by the 89th Legislature,

Regular Session, 2025, authorizing the governing body of a

political subdivision to adopt an exemption from ad valorem

taxation of a portion, expressed as a dollar amount, of the market

value of an individual's residence homestead and providing for the

adjustment of the exemption amount in subsequent years to reflect

inflation is approved by the voters. If that amendment is not

approved by the voters, this Act has no effect.