The bill proposes a significant change to the ad valorem taxation of tangible personal property used for income production by exempting up to $250,000 of its appraised value, a substantial increase from the previous threshold of $2,500. This amendment to Section 11.145 of the Tax Code also introduces a requirement that individuals must only render their income-producing tangible personal property for taxation if its aggregate market value exceeds the exempted amount. The implementation of this exemption is contingent upon a constitutional amendment, which, if approved, will guide the appraisal process and tax calculations for the 2025 tax year. The provisions related to this exemption are set to expire on December 31, 2026, ensuring that the changes are temporary and dependent on voter approval.

Additionally, the bill introduces new regulations regarding the timing of tax payments for supplemental tax bills, stating that taxes are due upon receipt and become delinquent if not paid by March 1 of the following year. This new provision, designated as Subsection (a-1), will also expire on December 31, 2026. The bill outlines its effective dates, indicating that it will take effect immediately if it receives a two-thirds majority vote from both houses of the legislature; otherwise, it will take effect on September 1, 2025. Overall, the bill aims to provide tax relief for individuals while establishing clear guidelines for the implementation and expiration of these changes.

Statutes affected:
Introduced: Tax Code 11.145, Tax Code 22.01, Tax Code 26.01, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 11, Tax Code 22, Tax Code 26, Tax Code 31)
House Committee Report: Tax Code 11.145, Tax Code 22.01, Tax Code 26.01, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 11, Tax Code 22, Tax Code 26, Tax Code 31)
Engrossed: Tax Code 11.145, Tax Code 22.01, Tax Code 26.01, Tax Code 26.04, Tax Code 26.08, Tax Code 26.09, Tax Code 26.15, Tax Code 31.01, Tax Code 31.02 (Tax Code 11, Tax Code 22, Tax Code 26, Tax Code 31)