Texas Property Taxes in 2026: $140,000 Homestead Exemption and Protest Guide

Source verification updated October 1, 2026. This guide explains statewide rules and public procedures; it is not legal or tax advice. Property owners should verify their account, deadlines, exemptions, and appeal rights with the county appraisal district and current Texas Comptroller materials.

1. The 2025 voter-approved changes now governing 2026

The property-tax package enacted in 2023 raised the mandatory school-district residence-homestead exemption from $40,000 to $100,000 and compressed school maintenance-and-operations tax rates. Texas voters then approved additional constitutional amendments on November 4, 2025. Those later amendments raised the general school-district exemption to $140,000 and the additional exemption for a qualifying person age 65 or older or disabled to $60,000, effective for tax years beginning on or after January 1, 2025.

Those figures apply to school-district taxation, not automatically to every city, county, college, hospital, or special-district levy. Other taxing units may adopt local-option residence-homestead exemptions of up to 20 percent of appraised value, subject to the statutory minimum. Counties collecting farm-to-market-road or flood-control taxes must provide the separate exemption described by state law. An appraisal district’s chief appraiser, not a private website or contractor, determines whether a property and applicant qualify.

A homeowner should distinguish three different concepts: market value, appraised value after any applicable limitation, and taxable value after exemptions. A higher market value does not always produce the same percentage increase in taxable value, and a larger exemption does not guarantee that the total bill will fall if tax rates, debt-service levies, new improvements, or other circumstances change.

2. Homestead appraisal limitation and the non-homestead circuit breaker are different

A qualifying residence homestead has a longstanding appraisal limitation under Tax Code Section 23.23. In general, after the limitation becomes applicable, appraised value is limited by the statutory formula tied to the prior year’s appraised value plus new improvements; the limitation is not a cap on market value and is not a promise that the tax bill can rise by only the same percentage.

Texas also operates a temporary circuit-breaker limitation for certain real property that is not a residence homestead. For the 2026 tax year, the Comptroller identifies the value threshold as $5,320,000 or less. The limitation uses the lesser of market value or a formula that adds 20 percent of the preceding year’s appraised value, that preceding appraised value, and the market value of new improvements. Specified properties receiving special appraisal are excluded.

The circuit breaker is scheduled to expire after December 31, 2026 unless the law is changed. Owners of rental, commercial, or other non-homestead real property should therefore verify both the current indexed threshold and whether their property type qualifies. Calling it a permanent “20 percent cap on all commercial property under $5 million” omits important limits and is inaccurate for 2026.

3. School rate compression does not freeze every local tax bill

School-district maintenance-and-operations compression uses state funding to reduce the local M&O rate produced by the school-finance formulas. M&O revenue supports ordinary operations; interest-and-sinking rates generally support voter-authorized debt. These components are calculated separately, and other local taxing units are outside the school-district compression formula.

That distinction matters when comparing bills. A statewide exemption or compressed school M&O rate may reduce one component while a voter-approved bond levy, new improvement, loss of an exemption, change in ownership, or rate adopted by another taxing unit affects another. Statements that a particular legislative package guarantees every homeowner a fixed dollar saving are unreliable without the property’s values, exemptions, and jurisdiction-specific rates.

The Texas Education Agency and Comptroller publish formulas, maximum compressed rates, property-value studies, and rate information, but the final bill comes from the local tax offices. Homeowners should compare the current and prior statements line by line rather than applying a statewide average.

4. How to preserve a 2026 appraisal protest

A property owner may protest matters listed in Tax Code Chapter 41, including appraised or market value, unequal appraisal, denial of an exemption, and application of the circuit-breaker limitation. The usual filing deadline is May 15 or 30 days after the appraisal district mails the notice of appraised value, whichever is later. Other events have different deadlines, and a weekend or legal holiday can affect the date. The controlling date is the one applicable to the owner’s notice and circumstances.

1. Read the notice immediately. Confirm the property, owner, market value, appraised value, exemptions, and protest deadline. Do not wait for a tax bill if the dispute concerns the appraisal notice.
2. File a written protest on time. Comptroller Form 50-132 is available, although a written notice can be sufficient when it identifies the property, owner, and a subject showing dissatisfaction. Select only grounds that honestly describe the dispute.
3. Request the district’s evidence. The appraisal district must provide required pre-hearing information and a statement explaining the right to request the data, schedules, formulas, and other material the chief appraiser plans to introduce. Request it promptly and follow local instructions.
4. Build property-specific evidence. Useful material can include comparable sales, photographs, repair estimates, surveys, income-and-expense records for income property, and evidence supporting unequal-appraisal analysis. Evidence must address the legal ground raised; a repair estimate is not automatically deducted dollar-for-dollar.
5. Consider an informal conference without surrendering the ARB hearing. A settlement may resolve the dispute, but filing the protest preserves access to the Appraisal Review Board if it does not.
6. Review the written order and appeal deadline. Appeal routes can include district court, regular binding arbitration, or the State Office of Administrative Hearings, depending on the property and issue.

5. Binding arbitration has eligibility and payment conditions

Regular binding arbitration is an alternative to a district-court appeal for qualifying ARB determinations concerning appraised or market value or unequal appraisal. Under the Comptroller’s current guidance, a residence homestead may qualify regardless of value; other disputed property generally must have an ARB-determined value of $5 million or less. Taxes that are not in dispute must be paid on time, no district-court lawsuit may already cover the same matter, and the arbitration request and deposit generally must be filed within 60 days after the owner receives the ARB order.

The deposit is not simply a small flat filing fee, and an arbitrator must dismiss a request that does not meet statutory requirements. Owners should use the Comptroller’s current eligibility guidance and filing system rather than relying on generalized advice. Beginning September 1, 2026, Texas law also provides a limited binding-arbitration process for specified procedural failures; it is distinct from regular value arbitration and has its own notice and filing requirements.

6. Practical review of a 2026 tax account

• Verify that the account shows the correct owner, mailing address, and property description.
• Confirm the general homestead exemption and any age-65-or-older, disability, veteran, surviving-spouse, or local-option exemption actually applicable.
• Compare market value with appraised value; do not treat them as interchangeable.
• Separate school M&O, school debt, city, county, college, hospital, and special-district rates.
• Identify new improvements or changes that could alter an appraisal limitation.
• Keep proof of filing, evidence requests, hearing notices, orders, and tax payments.
• Use the county appraisal district for account-specific decisions and the Texas Comptroller for statewide forms and guidance.

The central lesson is procedural: the 2026 exemptions are materially larger than the 2023 amounts, but the property owner’s outcome still depends on qualification, appraised value, local rates, and timely use of protest rights. Related State News Now reporting covers another major homeowner-cost issue in Florida and housing and zoning policy in Massachusetts.