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Change to homestead exemption law causing confusion for some property owners

Travis Central Appraisal District is making efforts to raise awareness of the change.

AUSTIN, Texas — A change to the state's homestead exemption law on Jan. 1, 2022, continues to cause confusion for some property owners in Travis County.

The KVUE Defenders first alerted you to the issue in January.

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The Travis Central Appraisal District, or TCAD, is doing what it can to educate homeowners. 

First, a homestead exemption in Texas removes part of your home's value from taxation so they lower your taxes. It's a tax break. 

Starting on Jan. 1 of this year, homeowners can file for that homestead exemption in the year they bought their home, instead of waiting until the following year. That's the change.  

So, if you buy a house in March of 2022, TCAD Chief Appraiser Marya Crigler said, "it prorates as of the date that they start occupying their new home."  

In other words, you don't have to wait until the following year to start saving money. 

The general rules in order to qualify for the new homestead exemption are as follows: the home must be purchased on or after Jan. 1, 2022; it has to be your principal place of residence; you have to own it and you have to live there. The property owner can only claim one homestead exemption for one property per tax year. 

Crigler said this next rule has been perplexing for some homebuyers: the property cannot already have a general residence homestead exemption for the year.

"It's been confusing for them to understand that if the previous owner had claimed an exemption, you can't claim it on this property. And what we do for property owners if they call us, if they're thinking about filing the exemption, we'll look it up for you and tell you whether or not the previous owner was filing that exemption," Crigler said.

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A lot of people have purchased new construction, so how does this new homestead exemption rule affect them? What about home improvements? How much of those improvements need to be completed? Crigler said there is no percentage and it comes down to being able to prove you live in that house.

"If there is a question of we don't think the house is being occupied, then property owners can provide us their certificate of occupancy, or they can provide us copies of utility bills to prove that they are actually occupying the property ... it really is a question of, are you actually living in the home, so that you can claim that as your homestead exemption," Crigler said.

TCAD held a webinar going over the new homestead exemption change in March. The video is on its website.

The appraisal district is also sending out a new flier this month, explaining the pro-rated homestead exemptions, all in an effort to educate and save taxpayers as much money as possible.  

One final note: When submitting your application for exemption, make sure your driver's license is up to date. Crigler said the address on the property owner's license must match the property you're claiming the exemption on.

The official deadline to file for a homestead exemption is April 30, but Crigler said property owners can file for a late application up to two years later.

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