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If you live in a primary residence in the state of Texas, be sure you file for your homestead exemption.
Wikipedia has good overview of the homestead exemption.
Homestead exemption laws typically have three primary features:
- They prevent the forced sale of a home to meet the demands of creditors;
- They provide the surviving spouse with shelter;
- They provide an exemption from property taxes which can be applied to a home.
What I wanted to focus on here was #3, especially how the exemptions work in Harris County and the Cy-Fair School District. The HCAD.org website has a good overview of all exemptions that a person may be eligible for in their primary residence.
In Harris County, there are three main types of property taxes that you may have to pay on your house.
The county appraises your home every year and your taxes are based off this appraisal. The good news is that if you are living in a house as your primary residence, you may file for a homestead exemption which will allow you to reduce the dollar amount that is taxable for a lot of those taxes.
For Cy-Fair, those exemptions look like this:
Regarding school taxes, everybody is under a homestead exemption in the state of Texas get a $15,000 deduction. The extra 20% that Cy-Fair ISD applies varies by school district from 0% to 20%.
Below is a table breaking all taxes for a house appraised at $250,000 in Coles Crossing:
| Tax | Tax Rate | Taxes (Pre-Homestead) | Homestead Exemption | Taxable Value | Taxes (Post-Homestead) |
|---|---|---|---|---|---|
| CYPRESS-FAIRBANKS ISD | 1.41% | $3,525.00 | 20% of home value PLUS $15k | $185,000.00 | $2,608.50 |
| HARRIS COUNTY | 0.39% | $980.60 | 20% of home value | $200,000.00 | $784.48 |
| HARRIS CO FLOOD CNTRL | 0.03% | $73.05 | 20% of home value | $200,000.00 | $58.44 |
| PORT OF HOUSTON AUTHY | 0.02% | $40.90 | 20% of home value | $200,000.00 | $32.72 |
| HARRIS CO HOSP DIST | 0.19% | $480.40 | 20% of home value | $200,000.00 | $384.32 |
| HARRIS CO EDUC DEPT | 0.01% | $15.13 | 20% of home value | $200,000.00 | $12.10 |
| LONE STAR COLLEGE SYS | 0.12% | $294.00 | $5000 of home value | $245,000.00 | $288.12 |
| HC MUD 365 | 0.50% | $1,250.00 | NONE | $250,000.00 | $1,250.00 |
| HC EMERG SRV DIST 9 | 0.06% | $150.00 | NONE | $250,000.00 | $150.00 |
| TOTAL: | $6,809.08 | TOTAL: | $5,568.68 | ||
| TAX %: | 2.72% | TAX %: | 2.23% |
So in this example, the home owner would save about $1300 per year in taxes by filing for their homestead exemption and their effective tax rate would be reduced from 2.72% to 2.23%.
It is unfortunate that MUD taxes do not have any exemptions. With some of the newer Cypress communities such as Bridgeland and newer sections of Towne Lake having MUD taxes of 1.5%, an exemption would be very helpful to home owners in those neighborhoods.
If you have questions regarding taxes, exemptions, or anything else real estate related in the Cypress area, please give me a call at 832-303-1018 to discuss.
