In Property Tax Texas

In Texas and the Dallas / Fort Worth metro area, as we approach October 1st, there are many things that make this a great time of the year:  the temperature drops below 90 degrees; the State Fair of Texas opens in Dallas; high school, college and pro football is underway; and property tax statements begin to appear in your mailbox.  Well, maybe the part about property tax statements isn’t so great, but at the Hegwood Group, we can help alleviate some of that burden.

The Texas property tax system can be divided into four phases:  Property Valuation, Appraisal Review and Protests, Budgeting and Setting of Tax Rates, Tax Collections.  As October 1st approaches, we are moving into the tax collection phase, so tax statements will begin to be issued.  You typically have until Jan. 31st of the following year to pay your taxes.  On Feb. 1, penalty and interest charges begin accumulating on most unpaid tax bills.   It is important to understand that the tax code does NOT relieve a property owner from paying their property taxes because a tax statement was not mailed to them.  If Feb. 1st is drawing near and you have not received a tax bill, you should contact your local tax offices. Find out how much tax you owe and make sure your correct name and address are on record.

Most property owners pay their property taxes before year’s end so they can deduct the payments from their federal income taxes.  In addition to paying the full amount, check with your tax collector on payment options that may be available on a local option basis such as:

  • Discounts, if you pay your taxes early
  • Split payment of taxes, allowing you to pay half your taxes by Nov. 30th and the remainder by June 30th without a penalty
  • Partial payment of your taxes
  • Escrow agreements for a special year-round account
  • Work contracts, in lieu of paying taxes, for certain taxpayers doing certain duties

Whether you pay your taxes by the end of the year on in January, make sure they are paid before the delinquency date of February 1st.  The longer you allow your delinquent property taxes to go unpaid, the more expensive and risky it becomes for you.  For starters, you will have penalty and interest charges added to your taxes.  Your property may also be foreclosed or seized.

Regular penalty charges may be as high as 12 percent depending on how long your taxes remain unpaid. Interest will be charged at the rate of 1 percent per month with no maximum.  Private attorneys hired by taxing units to collect delinquent accounts can charge you an additional 20 percent penalty to cover their fees.

Some tax collectors will allow you to pay delinquent taxes in installments for up to 36 months.  They are not required to offer this option, except for a residence homestead.  Before signing an installment agreement, you should know that the law considers your signature an irrevocable admission that you owe all the taxes covered by the agreement.

Fall in Texas and the Dallas / Fort Worth metro area can be a fun and memorable time of year so don’t let your property tax statements ruin it.  Plan accordingly and you’ll be much happier.  You can also contact the Hegwood Group and we’ll be happy to assist you with any questions or concerns you may have.

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