Texas lawmakers passed SB 4 and SB 23 with large bipartisan support, allocating up to $10 billion in state funds to raise the homestead exemption.
This fall, voters will decide whether to raise the homestead exemption yet again. Lawmakers used state tax dollars to offset local school property taxes. Monday, Republican Gov. Greg Abbott signed the two bills into law at the Robson Ranch adult community center in Denton.
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WATCH HEREEarlier this spring, lawmakers approved the proposals. SB 4 raised the homestead exemption from $100,000 to $140,000. SB 23 raises the homestead exemption to $200,000 for seniors and people with disabilities. Since these changes to the Texas Constitution require voter approval, the proposals will be on the ballot this fall.
The two measures combined could save the average homeowner between $500 and $900, according to the law’s author, Texas Sen. Paul Bettencourt, R‑Houston.
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SIGN UP The money comes from the state budget, funded primarily through sales and business taxes. Lawmakers this spring used those funds to pay property taxes for the increased homestead exemptions.
Another option at the Texas Capitol was reducing—or “compressing”—tax rates across the board for all property owners, including commercial properties. Instead, lawmakers decided to focus on homeowners.
This effort follows a historic property tax relief package in 2023. Over the past two years, lawmakers have dedicated $28 billion from the state budget for local property tax relief.
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Some leaders, including Republican Lt. Gov. Dan Patrick and Abbott, said they’re planning for more property tax changes in 2027.
