Prop 4 - Property Tax bills (Austin, Round Rock: homes, school districts, income)

[mickey65]

Gee, I went from excitement to an eye roll when I got my tax bill in the mail yesterday. Looks like the only ones getting anything from the Prop 4 "discount" are those with the 65 years old and over exemptions.



Wasn't really worth it for me. I saved a little over $300 this year because of it...yippy skippy...

[Need4Camaro]

I haven't been paying much attention to the bill but it appears that these are the stipulations:

https://www.kiplinger.com/taxes/texas-proposition-4

Approximately $6.5 billion will be used to increase the Texas homestead exemption from $40,000 to $100,000 ($110,000 for homeowners 65 and older).
Approximately $7.1 billion will be sent to school districts, which is meant to reduce the amount of school property taxes districts need to collect.

So it seems to apply to everyone with a homestead exemption, including those under 65 years of age, and those over 65 years of age seem to get a slightly larger exemption. $100k under 65 -- $110k over 65 ... so I do not think those over 65 will get a significantly larger discount.

I suppose that the value of your home will also have an impact of the significance of savings you will see as well. If you say having a home valued @ $700k then a $100k exemption might not feel like very much over the $40k exemption... I assume both would see similar 'savings' but the home owner with the higher value will not feel it to be as impactful as the home owner with the lower value. I also haven't paid attention to another potential aspect, and that is the potential for local property tax rates to change after the bill was approved.. ..but it appears that the ~$300 figure seems to be accurate as per individual savings.

[mickey65]

My home (in Round Rock) is valued at $254k this year. I've spoken to a couple of over 65 people who own their homes and they raved about the thousands of dollars they saved this year on their Property Tax bill...


I just don't feel the Prop 4 thing was really worth it...at least for me.

[Need4Camaro]

Originally Posted by mickey65

My home (in Round Rock) is valued at $254k this year. I've spoken to a couple of over 65 people who own their homes and they raved about the thousands of dollars they saved this year on their Property Tax bill...


I just don't feel the Prop 4 thing was really worth it...at least for me.

Interesting, I'm not super affluent about the 65+y/o exemptions.. ..and am not sure what kind of discounts / exemptions they were getting before hand either.. ..so perhaps there were additional exemptions that applied specifically to 65+y/o along with the $110k homestead that were included in the bill. I will say from a homeownership perspective, it works out better for them than it used to at least as it sounds like it makes retiring here more plausible.

As for prop 4, perhaps the savings were smaller than most anticipated but, something is better than nothing... ...although I do wonder if the state can truly handle a reduction of tax revenue, and where they will look to potentially make up for the loss of revenue..

[ScoPro]

My brother (85) said his property tax bill will be almost 50% less over last year as a result of the increased exemptions.
I (79) have not received mine yet.

Thank you lege.

[Trainwreck20]

Originally Posted by mickey65

My home (in Round Rock) is valued at $254k this year. I've spoken to a couple of over 65 people who own their homes and they raved about the thousands of dollars they saved this year on their Property Tax bill...


I just don't feel the Prop 4 thing was really worth it...at least for me.

Most of their savings are not related to Prop 4, then. $60k higher exemption will basically save you your average tax rate x 60,000. In Austin, the rate is ~2%, so 2% x $60,000 = $1,200. If you have historically been below your homestead 10% cap, though, and you have a 10% jump in assessed value due to that, then the savings will likely be eclipsed by that. There are other factors in your tax bill that can cause it to go up as well, of course. But under 65 should see 1,200 to 1,800 in savings (2 to 3% tax rate) while over 65 should see $1,400 to $2,100. I.e. 200 to 300 dollars more.

[Jtxg]

I think the reason an over 65 person may see a bigger savings, is let's see they turned 65 in 2018. Their school tax was frozen in year 2018. We all know what happened to values 2020-now. But their school tax was frozen still at 2018 value. Now they get an additional 60k exemption value. So two homes side by side, you could theoretically have an over 65 person now paying school tax on 200k, while their next door neighbor, under 65, is paying school tax on 400k. The over 65 person's tax bill will be significantly lower. I could be wrong on this, but that's just my guess.

On a totally different note, I don't really know why an over 65 person gets such a huge tax benefit from school tax. I have never had kids, I'm not using the school system at all, whereas many of the over 65 at least have grandchildren using the school system.

[Trainwreck20]

Originally Posted by Jtxg

I think the reason an over 65 person may see a bigger savings, is let's see they turned 65 in 2018. Their school tax was frozen in year 2018. We all know what happened to values 2020-now. But their school tax was frozen still at 2018 value. Now they get an additional 60k exemption value. So two homes side by side, you could theoretically have an over 65 person now paying school tax on 200k, while their next door neighbor, under 65, is paying school tax on 400k. The over 65 person's tax bill will be significantly lower. I could be wrong on this, but that's just my guess.

On a totally different note, I don't really know why an over 65 person gets such a huge tax benefit from school tax. I have never had kids, I'm not using the school system at all, whereas many of the over 65 at least have grandchildren using the school system.

It has nothing to do with whether you have kids or not, and solely on the support of public education for the benefit of the whole. Whether you have kids or not, you still benefit from an educated and competent workforce.

The tax break is based on retirement age and ability to pay - if it was an income tax, then you would likely see a reduction when you retire. Since it is a property tax, the over 65 school-tax freeze is a comparable tax break.

[karpo1]

My property tax went -$700 from last year

[ScoPro]

Originally Posted by Trainwreck20

It has nothing to do with whether you have kids or not, and solely on the support of public education for the benefit of the whole. Whether you have kids or not, you still benefit from an educated and competent workforce.

That’s a point too many of my fellow old farts don’t realize.