Texas Homestead Exemption Law

Texas homestead exemption laws protect a primary residence from seizure by creditors. A homestead exemption may also refer to the favorable tax treatment given to a homestead. Texas has two classes of homestead. Urban homesteads contain no more than 10 acres located in a city, town or village. Rural homesteads may have up to 200 acres. Texas considers improvements to the land part of the homestead exemption.

  1. History

    • According to the Texas State Historical Society, early Texas settlers often had creditors pursuing them. Stephen F. Austin, founder of Anglo-American Texas, suggested a moratorium on foreign debt. In 1829, the legislature followed his recommendations. Although the legislature repealed the homestead exemption in 1831, they build similar language into the Texas Homestead Exemption Act of 1839 passed into law in the Republic of Texas. The act continues as law in Texas with only minor changes.

    Tax Implications

    • According to Susan Combs, Texas Comptroller of Public Accounts, a Texas homestead owner may receive a $15,000 homestead exemption deducted from the home’s value for the payment of school taxes and a $3,000 exemption on county taxes collected for farm-to-market roads or flood control. At age 65, individuals or the disabled may receive an additional $10,000 for their homestead exemption for school taxes. In addition, a city, county, school, or special district may offer an exemption of up to 20 percent of a home's value.

    Exceptions

    • A Texas homestead cannot forcibly be sold to pay debts, except when the debt involves a loan for purchase of the property or the debt is owed to the United States government. Other exceptions include court-ordered property seizure, a debt from a lien against the property or a debt owed to contractors for labor or material used to improve the property. The Texas homestead exception does not include an extension of credit, a reverse mortgage on the homestead property’s value or a personal property lien secured by a manufactured home located on the homesteaded property.

    Claiming

    • To claim a Texas homestead exemption, you must file an Application for Residence Homestead Exemption – Property Tax Form 50-114 – with your county appraisal district.The form requests identifying information about the owner and a description of the property. To get the additional $10,000 for being 65 or older or disabled, the birthdate listed on the application is used for age qualification. Document your disability claim with letters from Federal Old-Age Survivors and Disability Insurance.

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  • Photo Credit Oilfield Pump Jack in Texas Oil Patch image by Doodlebugs from Fotolia.com

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