The Texas Senator passed the unanimous law on February 13th, with the aim of reducing taxes on homeowners.
Senate Bill 4 will increase the tax exemption for major Texans housing to $140,000, and will only apply to taxes collected by public schools. Previous reports from community impacts show that the current Homestead exemption is $100,000 for most homeowners and $110,000 for seniors with disabilities and disabled people.
The proposal by Senator Paul Bettencourt of R-Houston is built on a $18 billion tax cut package approved in 2023, which will raise tax cuts for homeowners, reduce tax rates charged by school districts, and small businesses tax has been eliminated.
overview
The Senator voted 30-0 on February 13th to approve the constitutional amendments related to SB 4, Senate Joint Resolution 2. The law is currently heading to a home in Texas.
If they pass both chambers, the tax cuts will be voted for voters in November. On the Senator’s floor, Bettencourt said 83% of Texas voters approved the 2023 constitutional amendment, increasing the Homestead exemption by $60,000.
“I’m really proud of the work we’ve been able to achieve for our Texas family. …It’s a big part of America’s dream,” said Sen. Angela Paxton of R-Mckinney. “This will give young families, many of them school-age children, and ultimately they can afford to buy a home for themselves.”
According to estimates from Bettencourt’s office, the average Texas homeowner could see almost $500 in annual savings under the Senate tax relief plan. This includes $363 from the proposed increase in Homestead exemptions and $133 from the reduction in school tax rates.
In the early draft of the 2026-27 state budget, the Senate secured $6 billion, raised the exemption for Homestead, and continued to cut school tax rates under the 2019 law.
Zoom in
About 49% of Texas school districts have an average home value below $140,000, Bettencourt said on Feb. 13. So the average homeowners in those areas would not pay property taxes to local school districts, he said.
“This is the real money to buy property taxes,” Bettencourt said. “(Taxpayers) will receive this exemption for the rest of their lives.”
If SB 4 becomes law, up to 90% of Texans over the age of 65 will be exempt from school property taxes, says Charles Skoma, a member of the Silver Hair Congress in Texas, on February 11th regarding the bill. This was said at a hearing of the committee. The group supports seniors at the Capitol.
“These people have been contributing to our community over the years… and we can only do that if we can stay healthy and maintain our homes,” Skoma said. . “Unfortunately, due to (high) costs, many older people are moving into the homeless category.”
During the Senator’s debate on February 13, Sen. Lois Kolkhorst of R-Brenham said he supported SB 4 but urged his colleagues to “not take the lap of today’s victory.”
Kolkhorst read a message from a constituent who said he believed the $100,000 homestead exemption passed in 2023 was “washing.” Constituent’s Appraisal District Review Board hiked the valuation value of his home for $71,000 last year.
Kolkhorst did not specify where this member lives. She represents the extent of southeast Texas, from Grimes County outside the university station to Aransas County along the coast.
“It’s very important to try to understand what’s going on at the local level,” said Sen. Joan Huffman of R-Houston.
Texas Republicans, including Gov. Greg Abbott, have vowed to vow the session to make it difficult for entities such as cities and school districts to tax them after Congress approved the cuts. Abbott said local governments need to receive two-thirds of approval from local voters before increasing tax rates during the general election.
One more
Sen. Sarah Eckhardt of D-Austin said on February 13 that Congress also believes it needs to work on tax increases for people who don’t own homes.
“It’s a great feeling to cut homeowners’ taxes. Politicians won’t have the opportunity to cut homeowners’ taxes,” says Eckhardt. “But I have settled on permanently increasing the burden of one class’s property, by definition, to permanently increase the tax burden on owners of all other classes.”
Eckhardt said that about 5% of Texas homeowners are spending more than 30% of their income on housing-related expenses as costs are hit by. Meanwhile, half of Texas renters are struggling with costs, she said.
“This bill could increase the rent costs for those renters if we don’t actively build more housing stocks,” Eckhardt said.
At the Feb. 11 hearing, Shannon Hullbrook, a financial analyst at Texan progressive think tank, said whether lawmakers are expanding Homestead exemptions is the best way to support Texans. He said he should consider what to do. spend.
“Now it’s time to take a step back and think about whether we should continue to cut more taxes. Or we should think about some of the other priorities in the state. With infrastructure and healthcare systems, we can work. It’s powerful,” Hullbrook said on Feb. 11.
