The bill amends Section 11.16(c) of the Texas Tax Code to clarify the definitions related to the exemption from ad valorem taxation for farm products in the hands of the producer. It specifies that "farm products" will now include standing timber, in addition to the existing definitions provided in Section 9.102 of the Business & Commerce Code. The definition of "in the hands of the producer" is also revised to clarify that for farm products other than timber, it refers to ownership by the person responsible for the physical requirements of those products as of January 1 of the tax year. For timber, it specifies that it includes standing timber or harvested timber located on the property where it was produced, under the ownership of the person who owned it when it was standing.

This Act will only apply to tax years beginning on or after January 1, 2026, and will take effect on that date, contingent upon the approval of a constitutional amendment proposed by the 89th Legislature in 2025. If the amendment is not approved by voters, the Act will have no effect.

Statutes affected:
Introduced: Tax Code 11.16 (Tax Code 11)