What does Prop. 1 mean for ME??

Posted by Dara Nugent on Monday, October 19th, 2015 at 9:11am.

 

On the upcoming ballot, Proposition 1 empowers you to vote to cut your property taxes and protect your home from additional taxes.  Here is a little bit more on what Proposition 1 is really about:

WHAT DOES PROP 1 DO?

Proposition 1 does four things. First, it lowers property taxes by increasing the homestead exemption from $15,000 to $25,000. Second, it ensures senior Texans and disabled Texans get as much tax relief as possible. Third, it prohibits local governments from repealing or reducing any homestead exemption that may exist. And finally, it ensures real estate transactions will never be subject to a tax.

WHAT IS A HOMESTEAD EXEMPTION?

A homestead exemption means that your home isn’t taxed at its full value – instead, a certain amount of your home’s value becomes tax-free. In Texas, the current homestead exemption is $15,000, meaning if your home is valued at $100,000, you only pay taxes on an $85,000 value. Prop 1 would extend that exemption to $25,000, meaning you’d pay taxes on even less of your home’s actual value.

WILL THIS REALLY AFFECT ALL TEXAS HOMEOWNERS?

If the property you’re living in is worth more than $15,000, then this Proposition will ensure you get tax relief. No matter how much your house is worth, Prop 1 will ensure you pay taxes on $25,000 less than that amount.

WILL PROPOSITION 1 WILL MEAN CUTS TO PUBLIC-EDUCATION FUNDING?

No! Under the provisions of Proposition 1, school districts remain whole. The increased exemption is absorbed by the State of Texas. Prop 1 just provides property tax relief for Texas homeowners – it doesn’t change how funds will be allocated to schools or stipulate how they can set their rates.

HOW DOES THIS HELP SENIORS AND PEOPLE WITH DISABILITIES?

Seniors and people with disabilities often have a fixed income, so this gives them some much-needed tax relief. Prop 1 helps seniors and disabled Texans by ensuring they receive the full benefit of the increased homestead exemption.

WHAT IS A REAL ESTATE TRANSFER TAX, AND WHY IS BANNING THEM A GOOD THING?

A real estate transfer tax is a tax imposed on the sale of a home, which adds another tax to the home selling and buying process.

View a map of Real Estate Transfer Tax Rates in the US

View a map of Real Estate Transfer Tax Rates in the US

Real estate transfer taxes can potentially lower property values and hurt the housing market. They are also technically a form of double taxation, as the buyer and seller will incur the cost of the tax in addition to the property taxes already on the home. It’s not fair, and banning them from Texas permanently will ensure that burden never touches Texas homeowners.

WHEN WAS THE LAST TIME LAWMAKERS INCREASED THE HOMESTEAD EXEMPTION?

In 1997, the Texas Legislature tripled the homestead exemption from $5,000 to $ 15,000.

HOW WILL THIS PROPOSITION MAKE HOMEOWNERSHIP MORE AFFORDABLE?

Both existing homeowners and new homeowners will have less of their home’s value taxed, thanks to the increased homestead exemption, and they won’t have to worry about paying an additional tax when selling or buying their home. Prop 1 means more savings for everyone.

WILL MY PROPERTY TAXES GO DOWN IF PROP. 1 PASSES?

Hopefully. Proposition 1 increases the existing homestead exemption for school taxes only.

The true answer to this question lies with local elected officials and your county’s appraisal district. Local governments, like cities, counties, school districts, hospital districts, and others set their own tax rates. Those rates are multiplied by your home’s value (as determined by the appraisal district). At the very least, however, your taxes will not go up as much as they would without Prop 1.

IF PROPOSITION 1 PASSES, WHEN WILL I SEE TAX RELIEF?

Almost immediately! Thanks to the Texas Legislature’s action, your 2015 tax bill will include the increased homestead exemption.

So now that you are informed... Go Vote!!!  Early voting starts TODAY!!! 

 

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Blessings,

Dara Nugent  |  REALTOR®
TM5 Properties
C: (817)706-7667  |  O: (979)703-1979x102  |  F: (979)703-1980 
3091 University Drive East Unit 230 |  Bryan, Texas 77802 

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