J&S Blog Header (30)

Real Estate Taxes Vs. Property Taxes in Texas. What’s the Difference? 

If you own property in Texas, you are probably familiar with real estate taxes, or as some may refer to as property taxes. These two terms are often used interchangeably, however, they have different meanings and are not the same in certain situations. This is especially important for Texans when it comes time to pay property taxes by February 1st of each year. In this blog, we will explain the differences between real estate taxes and property taxes and why this difference matters.

What Are Property Taxes?

According to the Texas Comptroller, property tax is a tax measured by the value of the property a taxpayer owns. This can be any property that you own – whether it is movable or immovable. For example, a home, RV, car, mobile home, piece of land, etc., would all be categorized as the property you own, meaning it will be taxed under property tax. In other words, property tax is a general term for the taxes you must pay to the government for all the property you own.

What Are Real Estate Taxes?

A real estate tax is just one type of property tax. These are the payments made to the government each year for all the real property you own, known as immovable land. This applies to any property that cannot be removed, such as a house, building, or plot of land. The amount of money you will pay in real estate taxes is determined by how much your real estate is valued in a specific county. This amount will then be paid to the government and used to fund local services, including public schools, libraries, emergency services, and road maintenance.

What is the Difference Between Real Estate Taxes Vs. Personal Property Taxes?

As we mentioned earlier, the real estate tax is a specific type of property tax and can be used interchangeably when talking about the real property you own. However, personal property tax is different and refers to the taxes that companies or entities pay on movable assets such as cars, boats, RVs, and planes. Real estate tax is immovable property, while personal property tax is movable.

Why This Matters

By recognizing the different types of property taxes, you will better understand what you are paying for at the end of each year. This will help you prepare in advance for how much you will have to pay by February 1st to avoid being blindsided by a large tax bill.

However, preparing for your property tax bill can be easier said than done. If you are struggling to pay your past due property taxes, Johnson & Starr can help. We are a trusted tax lender with years of experience working with property tax loans in Texas. We pay your property tax bill in full and create a repayment plan based on your needs. Give us a call today at 888-508-3894, and we will help answer any of your questions.