Are Property Taxes Paid in Advance in Texas?
Gain clarity on Texas property tax obligations. Understand the annual cycle of assessment and payment, and when your taxes are truly due.
Property taxes in Texas fund local government entities like school districts, counties, cities, and special purpose districts, providing essential revenue for public services. Understanding their operational timeline is important for property owners.
The Texas Property Tax Year
Property taxes in Texas are based on property value as of January 1, which is the official assessment date for the calendar year (January 1 to December 31). A tax lien automatically attaches to the property on January 1 to secure payment.
Appraisal districts determine property values and send notices between April and May. Owners can protest the appraised value, usually by May 15 or 30 days after notice mailing. After certification, local taxing units adopt tax rates between September and October based on budgetary needs. The tax liability covers the concluded calendar year, meaning the taxes are not paid in advance.
Property Tax Billing and Payment Due Dates
Tax bills are mailed by tax assessor-collectors starting in October for the current year’s taxes. Payment is due upon receipt and becomes delinquent if not paid by January 31 of the following year. This means property taxes are paid in arrears, covering the preceding tax year.
If January 31 falls on a weekend or holiday, the deadline extends to the next business day. Taxpayers have various payment options, including full payment by the deadline. Eligible taxpayers, such as those aged 65 or older, disabled individuals, or disabled veterans, may pay homestead taxes in four equal installments without penalties or interest. The first installment for these taxpayers is due by January 31.
Consequences of Late Payment
Failure to pay property taxes by the January 31 deadline results in delinquency on February 1. Penalties and interest accrue immediately. A 6% penalty and 1% interest are applied on February 1, with the penalty increasing by an additional 1% monthly until July 1, reaching a total of 12%.
Delinquent accounts may incur an additional collection penalty of up to 20% of the total amount due if referred to tax attorneys. Unpaid property taxes can lead to legal action, including tax liens and foreclosure proceedings. While a tax lien attaches on January 1, formal foreclosure begins after delinquency, potentially leading to property sale to satisfy the debt.