H.B. No. 41 seeks to limit the total amount of ad valorem taxes that certain taxing units, excluding school districts, can impose on the residence homesteads of disabled or elderly individuals and their surviving spouses. The bill amends Section 11.261 of the Tax Code, changing the heading to clarify that the limitation applies to taxing units other than school districts. It introduces new subsections that outline the conditions for these tax limitations, including provisions for individuals qualifying for exemptions under Section 11.13(c) and the treatment of surviving spouses. The bill specifies that the limitation applies to a "taxing unit" and prohibits these units from increasing the total annual ad valorem taxes on eligible homesteads beyond the amount imposed in the first tax year the individual qualified for the exemption.

Additionally, the bill modifies the calculation of total taxable value for taxing units, replacing previous references to "county, municipality, or junior college district" with "taxing unit." It clarifies that the current total value for a taxing unit, similar to that of a school district, excludes the total value of homesteads qualifying for a tax limitation. The bill also stipulates that "last year's levy" and "last year's total value" will exclude the total value of homesteads qualifying for tax limitations. H.B. No. 41 is set to take effect on January 1, 2026, contingent upon the approval of a constitutional amendment proposed by the 89th Legislature. If the amendment is not approved by voters, the provisions of this bill will not take effect.

Statutes affected:
Introduced: Tax Code 11.261, Tax Code 11.13, Tax Code 26.012 (Tax Code 26, Tax Code 11)