Texas Homestead Exemption Guide for Buyers & Owners (2026)

Buying a home in Texas comes with a noticeable property tax bill, and new buyers are often surprised by how much those taxes affect their monthly mortgage payment.

This 2026 guide explains the Texas homestead exemption, including the $140,000 school district exemption, local percentage exemptions, the 10% annual appraisal cap, and step-by-step instructions on how to file Form 50-114.

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You will see exactly who qualifies, how the exemption lowers your taxable home value, what changed in recent Texas tax law, and how to claim your exemption in the year you buy.

What Is the Texas Homestead Exemption?

A residence homestead exemption removes part of your home's appraised value from property taxation, which lowers the taxable value used by local taxing units to calculate your annual tax bill. It is not a direct dollar-for-dollar tax credit; instead, it reduces the value that your school district, county, city, or special district can tax.

To understand how the Texas Comptroller of Public Accounts illustrates the math, consider a home appraised at $300,000. If you qualify for the mandatory $140,000 school district homestead exemption, you pay school district property taxes on the home as if it were worth $160,000.

Because property taxes are part of your monthly escrow payment on most Texas Home Loan Options, lowering your taxable value directly helps manage your ongoing housing costs.

2026 Texas Homestead Exemption Amounts and Appraisal Caps

Texas property taxes are collected locally by school districts, counties, cities, and special districts. Several exemptions and appraisal caps work together under the Texas Tax Code.

Note: Statutory exemptions and thresholds are the current published figures in the Texas Tax Code and Comptroller guidance. Because local option exemptions and tax rates vary by jurisdiction, always confirm your property's specific exemptions with your county appraisal district or a participating lender.

The $140,000 School District Exemption (S.B. 4 / Proposition 13)

Under Texas Tax Code Section 11.13(b) and Article VIII, Section 1-b(c) of the Texas Constitution, every adult homeowner is entitled to a $140,000 exemption from school district property taxes on their residence homestead.

Senate Bill 4 of the 89th Texas Legislature raised this figure from $100,000, contingent on a constitutional amendment, S.J.R. 2. Texas voters approved that amendment as Proposition 13 on November 4, 2025 (adopted with 79.4% of the vote, according to the Texas Legislative Council). The $140,000 exemption applies starting with the 2025 tax year and continues for 2026 and later tax years.

The $3,000 County Exemption

Under Tax Code Section 11.13(a), if your county collects special taxes for farm-to-market roads or flood control under Article VIII, Section 1-a of the Texas Constitution, the county must provide a $3,000 residence homestead exemption against your assessed value for those taxes.

If a county with these taxes also offers a local optional exemption for homeowners who are 65 or older or disabled under Section 11.13(d), you cannot stack both for that specific county tax—you take only the over-65 or disabled exemption.

Local Option Percentage Exemptions (Up to 20%)

In addition to state-mandated school and county exemptions, any taxing unit—including a city, county, school district, or special district—can vote before July 1 to adopt an optional percentage homestead exemption under Tax Code Section 11.13(n).

• Maximum percentage: Up to 20% of your home's appraised value.
• Minimum dollar floor: If the adopted percentage calculates to less than $5,000 on your home, you are entitled to a minimum exemption of $5,000 of appraised value.
• Protection against reductions: Under Section 11.13(n-1), a school district, city, or county that had a local percentage exemption in place for the 2022 tax year may not reduce or repeal it. This protection expires December 31, 2027.

Because these percentage exemptions are optional, whether your home receives one depends entirely on the city, county, and school district where you buy.

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How the 10% Homestead Appraisal Cap Works (Tax Code 23.23)

In fast-growing Texas neighborhoods, the 10% homestead appraisal cap under Texas Tax Code Section 23.23 is just as important as the dollar exemption.

Once your home is protected by the homestead cap, the appraisal district cannot raise your home's appraised value by more than 10% per year for tax purposes, regardless of how much local market values jump. Specifically, your appraised value is limited to the lesser of:

1. The current market value of the home, or
2. Last year's appraised value, plus 10% of last year's appraised value, plus the market value of any new improvements added to the property.

Repairs and ordinary maintenance do not count as "new improvements," and replacement structures built after a casualty loss generally do not count either. The market value of true new improvements is added on top of the 10% calculation.

When the 10% Cap Starts and Ends

Timing matters for first-time buyers checking the Requirements to Buy a House in Texas:

• When it starts: Under Section 23.23(c), the 10% cap takes effect on January 1 of the tax year following the first tax year you qualify the home for a homestead exemption.
• Mid-year purchase rule: Under Section 23.23(c-1), if you buy a home after January 1 and qualify for a mid-year prorated homestead exemption under Section 11.42(f), the law treats you as qualifying on January 1 of the following tax year. That means your 10% cap begins on January 1 of the year after that.
• When it ends: The cap expires on January 1 of the first year in which neither the owner, the owner's spouse, nor a qualifying surviving spouse qualifies for the homestead exemption.

What About the 20% Non-Homestead Cap?

For real property that is not a residence homestead—such as rental properties financed with Texas DSCR Loans, second homes, or certain commercial properties—Texas Tax Code Section 23.231 provides a temporary 20% annual "circuit breaker" appraisal cap.

• Value threshold: To qualify in 2026, the property must be appraised at or below $5,320,000 (up from $5,000,000 in 2024 under the statute and $5,160,000 in 2025, according to the Texas Comptroller). Agricultural and timber land and other special-appraisal property are excluded.
• When it starts: It takes effect on January 1 of the year after the owner first owns the property on January 1.
• Scheduled expiration: Under current law, this 20% non-homestead cap expires on December 31, 2026, according to the statute and the Texas Comptroller. We found no enacted extension, so confirm its status with your appraisal district before relying on it after 2026.

Who Qualifies for a Texas Homestead Exemption?

To claim the general residence homestead exemption under Texas Tax Code Section 11.13, you and your property must meet four core rules:

1. Principal residence: You must occupy the property as your primary, principal residence.
2. Individual or qualifying trust ownership: The home must be owned by one or more individuals—either directly or through a qualifying trust—and occupied by an owner, an owner's surviving spouse who holds a life estate, or a trustor or beneficiary of the qualifying trust.
3. One homestead at a time: Under Section 11.13(h), you cannot receive a residence homestead exemption on more than one property in the same year, whether in Texas or in another state. Co-owners (joint, community, or successive) share a single exemption on the home rather than each receiving a separate one.
4. Property type and 20-acre limit: Under Section 11.13(j)(1), a residence homestead is a structure (including a mobile home), or a separately secured and occupied part of a structure, designed or adapted for human residence, along with up to 20 acres of land and improvements that have identical ownership. If you are buying with Texas Condo Loans, ask your appraisal district how this applies to your unit.

Special Situations: Home Businesses, Rentals, and Temporary Absences

• Partly rented or business-use homes: Under Section 11.13(k), if you rent out a portion of your home or use part of it to produce income, the rest of the home still qualifies as your homestead. You report the income-producing percentage on Form 50-114, and the exemption simply does not apply to that part.
• Temporary absences: Under Section 11.13(l), you do not lose your homestead exemption if you temporarily move away for less than two years, provided you intend to return and do not establish a new principal residence elsewhere. The homestead also survives an absence for military service or a stay in a care facility.

Buying a New Home in Texas: The January 1 Rule and Mid-Year Proration

Texas property tax eligibility generally follows a January 1 rule under Tax Code Section 11.42(a): eligibility and the exemption amount are determined by your qualifications on January 1, and if you do not qualify on January 1, you cannot receive the exemption that year.

Buyers closing on a home mid-year have an important exception under Tax Code Section 11.42(f), which covers the general homestead exemptions but not the 65+ or disabled exemptions in Section 11.13(c) and (d):

• Immediate prorated exemption: If you acquire a home after January 1 and move in as your principal residence, you can qualify for the general homestead exemption for the remaining portion of that tax year immediately upon qualifying—if the previous owner did not already receive the same exemption on that property for that tax year.
• If the seller had the exemption that year: In practice, a buyer can usually get a prorated exemption in the purchase year only if the seller did not have a homestead exemption on that property that year.
• 1-year filing deadline for mid-year buyers: Under Section 11.43(d), if you are claiming a prorated mid-year exemption under Section 11.42(f), you must file your application before the first anniversary of the date you acquire the property.

Whether you are buying with FHA Loans in Texas, USDA Loans in Texas (2026), or a state assistance option from our guide to 58 Texas First-Time Home Buyer Grants & Programs (2026), knowing whether the seller had an active homestead exemption helps you and your lender estimate your first-year property tax escrow accurately.

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How to File a Homestead Exemption in Texas Step by Step

Filing your Texas homestead exemption is straightforward. Follow these four steps once you have closed on your home and moved in.

Step 1: Update Your Texas Driver's License or State ID First

Under Tax Code Section 11.43(j) and (n), you must include a copy of your Texas driver's license or Texas state-issued personal ID certificate with your application, and the address printed on that ID must match the physical address of the homestead property.

The chief appraiser cannot approve your exemption unless the addresses match, with narrow exceptions:

• Residents of health or care facilities and participants in the Attorney General's address confidentiality program are excused from the ID requirement.
• The chief appraiser may waive the matching-address rule for active-duty military members or their spouses who provide a military ID and a utility bill, or for holders of certain licenses issued under Transportation Code Section 521.121(c) or Section 521.1211.

Step 2: Complete Comptroller Form 50-114 (or Your CAD's Online Portal)

The official state application is Texas Comptroller Form 50-114, Residence Homestead Exemption Application (Rev. 02-26). On the form, you will provide:

• Your name, birth date (used to grant the 65+ exemption automatically later), and driver's license, state ID, or Social Security number.
• Each owner's name and that owner's interest in the property.
• The date you acquired the property and the date you began occupying it as your principal residence.
• The number of acres (up to 20) and whether any portion is used to produce income.
• Whether you are transferring an exemption or a tax limitation from a previous home.
• Your signed statement confirming the facts are true and that you do not claim a homestead exemption on any other property in Texas or elsewhere.

If your name is not on the recorded deed (including heir property): Under Section 11.43(o), you must also attach Form 50-114-A (ownership affidavit). Heir property owners also submit a copy of the prior owner's death certificate, the most recent utility bill, and any court record citation if available.

Step 3: Submit to Your County Appraisal District (Not the Comptroller)

Do not mail Form 50-114 to the Texas Comptroller. Under Tax Code Section 11.43(a), you must file your application with the county appraisal district (CAD) in each county where the property is located.

Several of the largest Texas appraisal districts accept applications online:

• Harris County (HCAD): File electronically through the HCAD Info and Exemptions mobile app. You need the date you moved in and a Texas driver's license.
• Dallas County (DCAD): DCAD's filing guide says homeowners applying for the current year may be eligible to use "File Homestead Exemption Online" from their account details page.
• Tarrant County (TAD): File online through TAD's TrueRoll portal (make sure to press "Submit Application" to receive your confirmation number).
• Bexar County (BCAD): Submit through the BCAD Online Services portal using the Owner/Agent ID and PIN printed on your appraisal notice.
• Travis County (TCAD): Submit online at TCAD's exemption portal, by mail, or in person at the TCAD office.

Both the Tarrant and Dallas appraisal districts state there is no fee to file a homestead exemption application.

Step 4: Know the April 30 Deadline and Late-Filing Rules

• Standard annual deadline: Under Tax Code Section 11.43(d), the general deadline to file is before May 1 (meaning no later than April 30) of the tax year for which you are requesting the exemption. For good cause shown, the chief appraiser may grant a single extension of up to 60 days.
• Late filing up to 2 years: Did you forget to file after moving in? Under Tax Code Section 11.431(a), the chief appraiser must accept and process a late homestead application if it is filed no later than two years after the delinquency date for the taxes on the homestead.
• Automatic bill adjustment or refund: Under Section 11.431(b), if your late application is approved, the tax collector deducts the exempted tax from your unpaid bill or automatically refunds the overpaid amount—no separate refund application is required.

Do You Have to Reapply Every Year? (The 2025 H.B. 2730 Rule)

No. Under Texas Tax Code Section 11.43(c), once your residence homestead exemption is granted, you do not need to reapply in future years. The exemption stays in place automatically until the property changes ownership or your qualifications change. If your right to the exemption ends, you must notify the chief appraiser in writing before May 1 of the following year.

House Bill 2730 (effective May 24, 2025) added Tax Code Section 11.43(c-1), which limits when an appraisal district can make you re-apply. A chief appraiser may now require you to file a new application to confirm your existing homestead only if the chief appraiser:

1. Has reason to believe you no longer qualify for the exemption,
2. Has first attempted to verify your eligibility through other means (which may include a Texas Department of Public Safety driver's license search), and
3. Sends you a written notice stating the specific reason the appraisal district believes you no longer qualify.

If you later consider borrowing against your home, see our guide to Texas Home Equity Loan Rules & HELOCs.

Additional Exemptions for Seniors (65+), Disabled Owners, and Veterans

If you are 65 or older, have a qualifying disability, or are a disabled military veteran, Texas law provides substantial extra property tax relief that goes well beyond the general $140,000 school exemption:

• Homeowners Age 65+ or Disabled: Under Tax Code Section 11.13(c) (amended by S.B. 23, after voters approved S.J.R. 85 as Proposition 11 on November 4, 2025), qualifying seniors and disabled homeowners receive an additional $60,000 school district exemption on top of the $140,000 general exemption—bringing the combined school exemption to $200,000 starting with the 2025 tax year. You also qualify for a school district tax ceiling (freeze) under Section 11.26, any local over-65 or disabled exemption your taxing units have adopted (at least $3,000 where offered), and the option to defer homestead property taxes under Section 33.06. Read our complete guide to Texas Property Tax Exemptions for Seniors.
• Disabled Veterans and Surviving Spouses: Under Tax Code Section 11.131, veterans who receive 100% disability compensation from the VA for a service-connected disability and hold a 100% disability rating or a determination of individual unemployability receive a 100% total property tax exemption on their residence homestead. Partially disabled veterans (10% to 70%+ ratings) qualify for $5,000 to $12,000 exemptions under Section 11.22, and a new 2026 exemption (Section 11.136, added by H.B. 2508 / Proposition 7) provides a total homestead exemption for unremarried surviving spouses of veterans who died from PACT Act presumptive conditions. If you are buying with VA Loans in Texas, see our full breakdown in the Texas Disabled Veteran Property Tax Exemption guide.

Next Steps for Texas Homebuyers and Homeowners

If you already own your Texas home and have not filed for your homestead exemption, update your Texas driver's license address and submit Form 50-114 to your county appraisal district by April 30. If you missed a past deadline, a late application can be filed up to two years after the delinquency date for the taxes on the homestead.

If you are planning to buy a home in Texas in 2026, factoring the $140,000 school district homestead exemption and any local option exemptions into your budget gives you a much clearer picture of your true monthly payment. Our team can help you check your eligibility, compare loan options, and get connected with the right next step.

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