Understanding Property Tax Exemptions for the 2026 Tax Year

O'Connor discusses how getting Your exemptions in order can save property owners big on taxes in 2026.

HOUSTON, TX, UNITED STATES, January 28, 2026 /EINPresswire.com/ --


Property taxes are usually the largest single expense for landowners in Texas. As the primary source of funding for government, including schools, Texas has to have high property taxes to keep things functioning. This has led to debates and legislation to help lower these taxes, though they still remain high. This has led to more Texans than ever using property tax appeals to lower their taxable value and eventually, their tax bill.

However, the traditional method is often the best option. Exemptions are usually the first option when it comes to lowering taxes, and Texas has plenty for taxpayers of all stripes. O'Connor will go over the types of exemptions owners can apply for, how they have changed, and when they need to file them.

Exemption Changes to Start 2026

Many new changes to exemptions were passed at the end of 2025. These became effective on January 1, 2026, and can provide enhanced relief for homeowners across the state. The homestead, over-65, and disabled exemptions all saw record increases to help the rising taxable values. These changes mostly go toward school taxes and have the potential to save owners thousands. In some cases, school taxes can even be eliminated entirely, if owners have the proper exemptions. There could be even more reforms coming in 2026, so owners must be sure to stay on top of any exemptions they qualify for.

Texas Homestead Exemption

The one exemption available to every homeowner in Texas, the homestead exemption has been a stalwart part of every taxpayer’s defense against property taxes for decades. This simple exemption allows a homeowner to knock off a large chunk of their taxable value when it comes to paying school taxes, the largest property tax type. Owners qualify for this exemption if the home is an owner's primary residence. They cannot claim it on rental properties, second homes, or other situations, however, only on their own permanent home.

This exemption was given an extreme overhaul at the end of 2025, which was retroactively applied to tax bills. Originally, the homestead exemption had seen an increase from $40,000 to $100,000 in 2023. 2025 saw this bumped to $140,000 for school taxes, bringing the largest savings yet seen. This saved homeowners across the state billions of dollars, and is seen as one of the most effective tax cuts in the country. While most Texans have homestead exemptions, this overhaul should encourage the remainder to file right away.

Homestead 10% Cap

If the owner's residence is declared a homestead, they get more legal and tax protections. The biggest benefit is a 10% cap on assessment increases. This means that their home cannot have its taxable value increased beyond 10% in any year. With the Texas housing market heating up, this can be incredibly valuable. This is especially useful in counties like Denton, Fort Bend, and Travis, where home prices are reaching new highs at rapid rates. This could even keep the assessed value below market value. The 10% rule protects owners against market changes, not against improvements to their home, which can make their assessment increase.

Over-65 Exemption

This exemption goes hand-in-hand with the homestead, and both can be applied at the same time. The over-65 exemption offers savings for homeowners who are 65 or over. Like the standard homestead, this exemption protects homeowners from school taxes. Since it stacks with the previous exemption, this can mean seniors will see smaller school tax bills, sometimes none at all. Like the homestead, the over-65 exemption saw a massive increase to end 2025, going from a cut of $10,000 to $60,000. When combined with the homestead, this translates into a reduction of $200,000. For many homes, this will eliminate the school tax burden for seniors entirely, potentially saving them thousands of dollars.

Disabled Exemption

Like the over-65 plan, the disabled exemption protects a vulnerable population from rising school taxes. This was originally a $10,000 exemption, but it was increased to $60,000 in 2025. This can be applied with the homestead exemption to get a total savings of $200,000. However, it cannot be used with the over-65 exemption, meaning the owner must choose one if they qualify for both. Like the others, this cut could be enhanced in the near future. Since the new version provides substantial relief, it is a must for any disabled homeowner to apply for this benefit.

Exemption Deadline for Current Bills is April 30

Owners have between January 1 and April 30 to apply for various exemptions if the owner wants them to apply to the current tax year. This means if the owner wants to get a reduction on the tax bill coming in the fall, they must do so by April 30. Owners can apply for exemptions at any time, but they will be applied to later bills. More flexibility was added in 2022, as owners have previously needed to have applied in January to get the current exemption.

The homestead exemption can be applied retroactively, up to two years in the past, while the over-65 exemption can be applied for just one year. Retroactive exemptions must be filed by the delinquency date of the year the owner wishes to apply for. For example, if the owner wants to apply for an exemption for the tax year of 2024, they must do so by January 31, 2027, as the delinquency date would be February 1. If they manage to land a retroactive exemption, they will receive a refund from the county for the overpayment. The owner can apply for retroactive benefits and current ones at the same time, but this must be done by April 30.

About O'Connor:
O’Connor is one of the largest property tax consulting firms, representing 185,000 clients in 49 states and Canada, handling about 295,000 protests in 2024, with residential property tax reduction services in Texas, Illinois, Georgia, and New York. O’Connor’s possesses the resources and market expertise in the areas of property tax, cost segregation, commercial and residential real estate appraisals. The firm was founded in 1974 and employs a team of 1,000 worldwide. O’Connor’s core focus is enriching the lives of property owners through cost effective tax reduction.

Property owners interested in assistance appealing their assessment can enroll in O’Connor’s Property Tax Protection Program ™. There is no upfront fee, or any fee unless we reduce your property taxes, and easy online enrollment only takes 2 to 3 minutes.

Patrick O'Connor, President
O'Connor
+ +1 713-375-4128
email us here
Visit us on social media:
LinkedIn
Facebook
YouTube
X

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.