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4 Reasons Why Property Taxes Are Higher in Texas

It’s no secret that Texas property taxes are some of the highest in the nation. However, Texans often wonder why. What causes Texas property taxes to be higher than other states? To help answer this question, we will explain 4 reasons why Texas property taxes are high and discuss how your tax dollars are allocated.

Reason #1: Texas is Dependent on Revenue from Property Taxes

Texas’s local governments rely heavily on taxes to fund public services including police departments, fire protection, public schools, libraries, city streets, county roads, etc. So, one of the main factors of high property taxes in Texas is the absence of a state income tax. Without income tax, Texas must make up for the lack of revenue in other ways to fund their local governments, leading to higher property tax rates for homeowners.

Reason #2: Taxes are Set at the Local Government Level

Did you know that the State of Texas does not actually determine how much a property owner pays in property taxes each year? Instead, it is up to the local authorities to determine this amount, allowing tax rates to vary between different locations. These rates are based on factors of the county, city, school district, and water district. For instance, depending on where you reside, you could be subject to taxes from other entities, including cities, hospitals, and junior colleges. So, depending on the county you live in, it will determine how much you pay in taxes.

Reason #3: Population Growth & Development

In recent years, Texas has seen a significant increase in residential growth and has become the second most populous state in the nation, creating a high demand for development. This rapid influx of residents requires the necessary infrastructure to keep up with the state’s increasing demographic. To fund the ongoing infrastructure, counties often rely on property taxes for support. So, homeowners could experience higher property tax rates as a result, depending on the county.

Reason #4: Rising Property Values

The high demand for construction and the booming real estate market has also led to an appreciation in Texas property values. This is determined when an appraisal district, administered by a chief appraiser, dictates the assessed value of a property. If the appraisal district increases the assessed value of a property, the annual property tax bill will also increase. However, if a property owner disagrees with the assessed value, they have the right to submit a formal protest to the appraisal review board to have the property re-evaluated.

We Can Help You Pay Your Property Taxes

We understand that dealing with property taxes in Texas is not always simple. When you do not pay your residential property tax on time, your county or other taxing authority can add costly penalties, interest, and fees, making it even more challenging to pay on time. So, if you are behind on your property taxes and find it difficult to pay them off on your own, Johnson & Starr can help! We will immediately pay the entire tax bill on your home and set up a flexible repayment plan for you. Contact us today for more information on how we can help you settle your property tax debt.