Texas House Bill HB3939

Texas 2021 - 87th Regular

Caption

Relating to a requirement that a purchaser of commercial real property disclose the sales price of the property to the appraisal district and to the use of that information by the appraisal district; creating a criminal offense.

Impact

The bill amends Chapter 22 of the Texas Tax Code by introducing a new subchapter that outlines the processes for filing a sales price disclosure report for commercial real property. The chief appraiser is authorized to use the disclosed sales price information to aid in determining the market value of the property, although it cannot solely increase the market value based purely on this information. The requirements are expected to affect real estate transactions significantly, particularly in how appraisal districts assess properties and enforce tax valuations based on recorded sale prices.

Summary

House Bill 3939 requires that purchasers of commercial real property disclose the sales price of the property to the appraisal district within ten days of the deed's recording. This bill aims to enhance the transparency of property transactions and ensure that appraisal districts are adequately informed about market values for tax purposes. By mandating this disclosure, the bill is intended to create a more standardized approach to property assessments and valuation.

Execution

The bill will come into effect as of January 1, 2022, applying to transactions occurring on or after January 1, 2020. It mandates that each appraisal district prepare and make available the necessary forms for the sales price disclosure report. The regulations outlined in HB3939 will likely require greater compliance and administrative efforts from both property purchasers and appraisal districts to align with the newly established requirements for property transactions.

Contention

There are notable points of contention regarding the implications of this bill. While proponents argue that increased disclosure will prevent under-assessment of commercial properties and enhance the efficiency of tax collection, some opponents raise concerns about privacy and the potential for sensitive financial information to be misused. Additionally, the bill establishes penalties for unauthorized disclosure of the sales price, categorizing such offenses as a Class B misdemeanor, which some critics view as overly punitive.