According to a 2023 study on property taxes by WalletHub, an average American single-family household has a median value of $217,500, and its residents spend about $2,471 on property taxes each year. In comparison, an equivalent average household in Texas would pay about $3,907, or over 58% more. The average property tax rate in Texas is 1.80%, which is currently the 6th highest rate in the United States. 

The property tax system in Texas comprises 3 primary parts: a county appraisal district, an appraisal review board, and the local taxing units themselves. Under the guidance of the county’s chief appraiser, the appraisal district establishes property values each year. The appraisal review board is an independent panel of citizens responsible for hearing and resolving disputes between property owners and the appraisal district. The local taxing units, which include school districts, cities, counties, and special districts, set tax rates and collect property taxes. 

Every property in Texas is appraised by January 1 of the tax year. The appraisal district mainly uses three approaches to value the properties in the jurisdiction: the market approach, the cost approach, and the income approach. After determining the value of the property, the appraisal district levies a tax rate for each category. Every local taxing entity in Texas calculates property taxes using the same method. The appraised property value is reduced by any qualifying exemptions or special appraisals, divided by 100, then multiplied by the tax rate established for each entity. 

Your assessed value is an annual estimation from your tax district that is used to calculate what you may pay. Every Texas homeowner has the right to review their home’s assessed value and file a protest. To increase the chances of a successful appeal, Texas property owners should be prepared to gather evidence supporting their protest. A successful protest will help to reduce the amount of property taxes you pay for the year.