Texas House Bill HB1393

Texas 2021 - 87th Regular

Caption

Relating to the maximum amount of the local option residence homestead exemption from ad valorem taxation by a taxing unit.

Impact

The implications of HB 1393 are significant for homeowners as it potentially increases the financial relief they receive from property taxes. If enacted, this bill will allow for more flexibility in how local taxing units can manage homestead exemptions, thus affecting the overall taxation landscape. The bill specifically applies to ad valorem taxes for tax years commencing on or after the effective date of January 1, 2022, making it a timely consideration for future tax planning.

Summary

House Bill 1393 proposes amendments to the Texas Tax Code regarding the maximum amount of the local option residence homestead exemption from ad valorem taxation by taxing units. The bill stipulates that individuals may be entitled to a homestead exemption based on a percentage of the appraised value of their residence. This exemption is contingent upon the governing body of the taxing unit adopting it before July 1st, following the legal procedures required for official actions. Notably, the bill ensures that if the calculated exemption amount falls below $5,000, individuals are guaranteed a minimum exemption of $5,000.

Contention

One of the points of contention surrounding HB 1393 is its dependency on the approval of a constitutional amendment proposed by the 87th Legislature, which aims to increase the maximum local option residence homestead exemption. If voters reject this amendment, then the provisions of HB 1393 will not take effect. This reliance on voter approval could spark debate regarding the implications for tax revenues at the local level and the potential need for adjustments in local government funding should the exemption amounts increase significantly.