Texas Leaders Finalize Property Tax Relief Deal for Residents and Companies

Key Takeaways:

• What Texas Property Tax Relief Looks Like in Practice: New legislation introduces larger homestead exemptions, limits on annual appraisal increases, and updated protections for seniors, disabled residents, and business owners. These changes aim to create fairer property valuations and reduce long-term tax pressure across the state.
• How House Bill 9, Senate Bill 4, and Senate Bill 23 Work Together:  Each bill plays a unique role in reshaping Texas property tax laws. Together, they create a more predictable and balanced system for homeowners and commercial property owners.
• Why Protest Rights Still Matter Before 2026:  Although the new laws are signed, key elements won’t go into effect until January 2026, pending voter approval. In the meantime, Texans can still protest their current assessments to lower this year’s bill. 

Texas property tax reductions have long been at the top of homeowners’ and commercial property owners’ wishlists. Texas property taxes rose by $5.4 billion last year alone, a 6.6% spike from 2023. As of June 16th, 2025, that wish became a reality. In a landmark moment, Governor Greg Abbott signed a series of bills to reshape how Texans experience property taxation. Backed by strong support across the state, this new relief package introduces changes that reach every corner of the property landscape.

Our team at Texas Tax Protest is here to help you understand everything. Legislative headlines can be hard to translate into real-world impact, especially when you’re sorting through new terminology or trying to figure out how these changes affect your future assessment. That’s why we’re breaking down what this relief deal means, how it affects your property’s taxable value, and the timeline for when voters will weigh in on its future.

A Closer Look at House Bill 9, Senate Bill 4, and Senate Bill 23

The property tax relief package might sound complicated at first glance, but at its core, it’s built on three major bills that work together to bring lasting change. Each one targets a different pressure point in the tax system, offering relief for homeowners, added protection for seniors and disabled Texans, and improved fairness for businesses.

House Bill 9: Commercial Property & Business Tax Relief

House Bill 9 focuses on helping businesses, particularly those hit hard by rising property valuations. The bill raises the exemption on business personal property from $2,500 to $125,000. 

That means many small and mid-sized companies will no longer pay property taxes on assets like equipment or office furniture up to that amount. The bill also taps into Texas’ budget surplus to help school districts lower their tax rates without losing funding, creating a ripple effect that benefits both businesses and homeowners.

Senate Bill 4: Bigger Homestead Exemptions for Texas Homeowners

Senate Bill 4 is all about easing the burden on homeowners. This bill boosts the mandatory school district homestead exemption from $40,000 to $100,000, which means more of your home’s value is shielded from school taxes. The result? Smaller tax bills for your primary residence. It also includes additional exemption increases for Texans over 65 and those living with disabilities, helping protect those with more limited income from rising appraisal values.

Senate Bill 23: Added Stability for Seniors and Non-Residential Properties

Senate Bill 23 zooms in on two key areas: long-term affordability for seniors and predictability for non-residential property owners. The bill raises the school tax exemption for seniors and disabled Texans to $200,000, which dramatically reduces the taxable value for many households. For commercial property owners, Senate Bill 23 sets new appraisal rules and value caps, so large jumps in property taxes won’t come out of the blue.

What the Texas Property Tax Relief Package Means for You

Rising property tax bills have weighed heavily on Texans in recent years. In 2024 alone, county taxes climbed by 10.4%, while school districts, cities, and special districts followed close behind. That surge pushed many homeowners and business owners to demand change, and now, state leaders have answered. Below, we’ve broken down how each piece of legislation contributes to this new wave of property tax relief.

Larger Homestead Exemption

Under Senate Bill 4, the mandatory school district homestead exemption jumps from $100,000 to $140,000. This allows homeowners to subtract a larger portion of their home’s value before taxes are calculated, lowering their school district tax burden. For most Texans, that means more money stays in their household budget, without requiring any major action or formal protest.

Tax Rate Compression for School Districts

School districts will no longer be able to collect taxes at the same rate per dollar of property value. Senate Bill 4 also enacts what’s known as “tax rate compression,” which reduces the portion of a homeowner’s tax bill tied to public school funding. The state will cover the funding gap, relieving homeowners and helping districts maintain necessary budgets.

Limits on Annual Appraisal Increases

Homeowners frequently struggle with sharp jumps in assessed value. Under the new relief package, appraisal districts must limit how much a property’s assessed value can increase each year. This change creates more predictability around future tax bills and offers a safeguard against steep, unexpected spikes in valuation.

Expanded Exemptions for Seniors and Texans with Disabilities

Additional exemptions under Senate Bill 23 expand relief for those aged 65 or older, as well as Texans living with disabilities. The updated legislation raises the school district exemption for these groups to $200,000, acknowledging that fixed incomes and rising costs don’t mix well. These targeted protections help stabilize long-term affordability.

Commercial Property Relief Through Appraisal Reform

Business owners haven’t been left out. House Bill 9 and Senate Bill 23 introduced changes for commercial property owners, including updated guidelines that limit how quickly certain business property values rise. Now, business owners gain stronger rights to challenge their appraisals, especially when valuation methods fail to reflect real market conditions. This shift gives companies a better chance to pursue fair assessments based on actual data.

When Do These Property Tax Changes Take Effect?

While the property tax relief bills have been signed into law, key components of the plan still depend on Texas voters. To make the changes permanent, the legislature passed three joint resolutions that placed constitutional amendments on the ballot in November 2025. Voters will have the chance to approve or reject these proposals during the general election.

Two resolutions (SJR 2 and SJR 85) aim to permanently amend the state constitution to raise homestead exemptions. These changes would lock in the larger exemption amounts outlined in Senate Bill 4 and Senate Bill 23. A third resolution, HJR 1, allows voters to approve the expanded business personal property tax exemption introduced in House Bill 9, raising it from $2,500 to $125,000. If approved, all changes will take effect January 1, 2026.

You Can Still Protest Property Taxes Before These Changes Begin

The bills signed by Governor Abbott mark a significant step forward for long-term property tax relief in Texas. However, those changes won’t take effect until January 2026, only if voters approve them. In the meantime, homeowners and commercial property owners still have the right to protest their current property tax assessments. Protesting can lead to immediate savings and reduce your bill long before any new exemptions or caps are implemented.

Start with the Right Comps

The foundation of any strong protest is selecting accurate comparable sales. These are properties similar to yours that sold recently and can be used to argue that your home or commercial building was overvalued. However, comps alone aren’t enough. The best comparisons are those that reflect the unique details of your property. That’s where adjustments come in.

Gather Evidence That Strengthens Your Case

Beyond comps, every strong protest needs a paper trail. This might include appraisal district data, sales disclosures, property condition photos, or contractor estimates for needed repairs. The more evidence you compile, the stronger your case will be when it’s time to present it.

Homeowners often overlook structural issues, zoning quirks, or neighborhood characteristics that may justify a lower valuation. Business owners, too, can lean on occupancy rates, market conditions, or declining rental income to build their argument. Presenting a clear narrative with supporting documentation helps you stand out from the crowd of rushed, cookie-cutter protests.

File the Protest and Prepare for the Hearing

Once your evidence is ready, you must file the protest with your local appraisal district by the deadline. From there, your case will go through the Appraisal Review Board (ARB) process. While some protests are resolved informally, many require a formal hearing. During the hearing, you’ll have the chance to present your comps and evidence directly to the board. Clear, organized communication is key. This is your opportunity to demonstrate how your valuation differs from what the district assigned, and why a lower figure is warranted.

Let Our Team at Texas Tax Protest Do the Heavy Lifting

Between tight deadlines, complex math, and ever-changing rules, property tax protests can feel overwhelming. That’s why many Texans turn to our team at Texas Tax Protest to handle the details from start to finish. We do the research, run the adjustments, compile the evidence, and present the case – so you don’t have to.

Our data-driven approach is tailored to the realities of your property and your local market. Whether you’re filing on your own home, investment property, or commercial space, we simplify the process and advocate for a fair outcome. And once the new laws are in place, we’ll be here to help you take full advantage of every available exemption, cap, and valuation opportunity.

Final Thoughts

Relief is on the horizon for Texas homeowners and business owners. The property tax reform bills signed into law bring meaningful changes to how taxes are calculated, capped, and contested, but the final step depends on voters. In November 2025, Texans will have the chance to approve key constitutional amendments that lock in larger exemptions and long-term protections. These decisions will shape how tax bills look starting in 2026.

Until then, there’s still time to take action. Our team at Texas Tax Protest is here to help you protest your current assessment, gather the right evidence, and pursue a lower taxable value right now. We handle the heavy lifting so you can focus on what matters most, knowing your tax outcome is based on fair data and expert strategy.

Read more: 

• The True Cost Of Homeownership: It’s More Than Just Your Mortgage
• Texas vs. California Property Taxes: Which State Hits Your Wallet Harder?
• Home Equity Loan vs. HELOC: Breaking Down The Pros, Cons, And Use Cases

Frequently Asked Questions About the Texas Property Tax Relief Deal

Is the property tax relief deal a permanent change to the tax code?

The recent property tax relief measures in Texas include both immediate and longer-term changes, but not all elements are permanent. Lawmakers have implemented changes such as an increased homestead exemption, which could remain in place unless revisited by future legislation. Some rates and provisions are subject to review, so keeping up with any updates each legislative session is important. 

How much will the average homeowner save under the new tax relief deal?

Exact savings depend on a homeowner’s property value and county appraisals, but early estimates suggest a noticeable reduction in annual property taxes. Thanks to expanded exemptions and adjusted tax rates, Texas homeowners could see hundreds of dollars in savings each year. 

What are the long-term implications of the Texas tax relief for state revenue?

The immediate benefit is putting more money back in the hands of property owners, but these changes also impact how local governments, schools, and the state fund essential services. Over time, a sustained reduction in property tax revenue could push lawmakers to find alternative funding sources or reevaluate spending priorities. 

Will the tax relief affect property values in Texas?

Lower property taxes often strengthen the real estate market, as affordability attracts more buyers and potential investors. However, property values are determined by a mix of factors: market trends, location, neighborhood amenities, and appraisal district practices. Reductions in taxes may boost demand and, by extension, influence property values, though every market responds a bit differently.

How significant is the tax cut for Texas businesses?

Commercial property owners in Texas benefit from the new relief deal through reduced taxable values and caps on appraisal increases. The significance varies by sector and property type, but many businesses can expect meaningful tax bill reductions. Having an expert review the comparables used by local appraisal districts—and making proper mathematical adjustments for property differences – can help businesses maximize these new savings opportunities.

How do residents apply for the property tax relief?

Most elements of the New Deal, like increased homestead exemptions, are applied automatically or through existing application processes. Homeowners should file or update their homestead exemption applications with their appraisal district if they haven’t already. Residents can file a protest for additional relief or to challenge assessed values. Texas Tax Protest simplifies these steps for clients, navigating the paperwork and deadlines to help Texans pursue fairer tax valuations.

Are renters in Texas eligible for any form of tax relief?

Unlike homeowners, renters aren’t eligible for property tax exemptions or direct relief under the New Deal. While landlords may pass on some savings in the form of lower rents, there’s no guarantee this will happen. Renters can, however, stay engaged in local elections and community forums to advocate for additional tenant-focused relief in future tax legislation.

Sources:

1. Office of the Texas Governor. (2025, June 16). Governor Abbott signs property tax relief laws in Denton. https://gov.texas.gov/news/post/governor-abbott-signs-property-tax-relief-laws-in-denton
2. Leonard, J. (2025, June 17). Texas property tax relief passed again. Washington Examiner. https://www.washingtonexaminer.com/news/3428423/texas-property-tax-relief-passed-again/
3. Texas Legislature Online. (2025). House Bill 9: 89th Legislature, Regular Session. https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=HB9
4. Texas Legislature Online. (2025). Senate Bill 4: 89th Legislature, Regular Session. https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=SB4
5. Texas Legislature Online. (2025). Senate Bill 23: 89th Legislature, Regular Session. https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=SB23