What to know about 2023 property taxes in North Texas
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Texas' historic property tax cut this year was intended to help families close out 2023 with extra savings — but some homeowners might still be feeling stretched thin amid rising property values and costs of living.
Driving the news: The deadline to pay taxes is Jan. 31 for most Texas counties if you want to avoid penalties and interest.
- You've got until the end of this month to pay your property taxes if you're planning to deduct them from your 2023 federal income taxes.
Why it matters: Local governments rely heavily on property taxes, especially in Texas where there is no state income tax, to operate.
- But for many North Texas homeowners, fast-rising property values have driven up property tax bills in recent years and added to the burden of high costs of living.
Catch up quick: In July, Gov. Greg Abbott signed an $18-billion property tax cut proposal for voter approval.
- In November, 83% of voters OK'd the plan to lower school district tax rates and increase the school homestead exemption from $40,000 to $100,000.
- The state will pay school districts billions of dollars from a massive budget surplus to help cover the difference in funding from property taxes.
- "Anyone with a homestead exemption would have noticed a decrease in their tax amount. That's a $60,000 increase in the exemption, so it's fairly significant," Sandy Cline, the property tax director in Collin County, tells Axios.
How it works: Appraisal districts usually start the process of assessing property values early in the year, giving property owners the chance to protest new values. The districts then send final valuations to taxing entities, which prepare tax bills and collect the money.
- Voter approval came after many counties had started processing and sending out property tax bills.
- Tax assessors in most cases factored the higher homestead exemption into this year's bills and included a warning on the statements that if the measure didn't pass, they would send an updated bill to collect the difference, Denton County chief appraiser Don Spencer tells Axios.
- "We anticipated the passing of that [measure]. That was pretty much the practice across the state," he says.
Between the lines: High demand and relatively low supply have driven up market values of homes regionwide.
- "The demand in the real estate market has been greatly increasing here. People are moving to Texas rapidly," Spencer says.
By the numbers: The average taxable value of homes in Denton County increased from roughly $402,000 in 2022 to roughly $449,000.
- The average market value of Collin County homes increased from around $513,000 in 2022 to around $584,000 in 2023.
The bottom line: "This last year with inflation, everybody is feeling the crunch. To be able to save some money on that high bill at the end of the year was definitely a good thing for taxes and for property owners," Spencer says.