Today's Bills of the Day are House Bill 234 by Rep. Dwayne Bohac (R) and Senate Bill 84 by Sen. Juan "Chuy" Hinojosa (D). These identical bills would permit a local taxing authority to increase the local option homestead exemption from 20% to 30%. Currently Spring Branch ISD is one of the few Houston area school districts that gives its homeowners the maximum 20% exemption (see this prior post -- Spring Branch ISD Continues to be a Relative Bargain: Second Lowest Real Tax Cost for Homeowners in the Houston Area -- for the details on Houston area school district exemptions and what that means to the taxpayer).
In the event these bills are passed, they will require approval of a constitutional amendment by the voters to become effective.
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HB 234 by Bohac and SB 84 by Hinojosa: relating to increasing the maximum amount of the local option residence homestead exemption from ad valorem taxation by a taxing unit from 20 percent to 30 percent.
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 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. 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 30 [20] percent.
SECTION 2. This Act applies only to ad valorem taxes imposed for a tax year beginning on or after the effective date of this Act.
SECTION 3. This Act takes effect January 1, 2008, but only if the constitutional amendment proposed by the 80th Legislature, Regular Session, 2007, to increase the maximum amount of the local option residence homestead exemption from ad valorem taxation by a political subdivision from 20 percent to 30 percent is approved by the voters. If that amendment is not approved by the voters, this Act has no effect.
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