H.B. No. 201 seeks to amend the Texas Tax Code to provide an ad valorem tax exemption for the residence homesteads of partially disabled veterans and their surviving spouses. The bill introduces Section 11.137, which allows veterans with a disability rating of at least 10% but less than 100% to receive a tax exemption equal to their disability rating percentage on the appraised value of their homestead. Surviving spouses of qualifying veterans, who have not remarried and maintain the property as their residence, are also entitled to the same exemption. The bill ensures that if a surviving spouse qualifies a different property as their residence homestead, they can retain the exemption amount previously granted.

Additionally, the bill amends various sections of the Tax Code to clarify the application process for these exemptions and expands eligibility to include unmarried surviving spouses of disabled veterans. It modifies the calculation of local governments' lost ad valorem tax revenue to include properties exempt under the new Section 11.137, while deleting previous language that referred to properties simply as "granted an exemption" under Section 11.131. The provisions of this bill will take effect for tax years beginning on or after January 1, 2027, contingent upon the approval of a constitutional amendment by voters that would allow for such exemptions. If the amendment is not approved, the bill's provisions will not take effect.

Statutes affected:
Introduced: Tax Code 11.42, Tax Code 11.43, Tax Code 11.439, Tax Code 26.10, Tax Code 26.1127, Tax Code 31.031, Local Government Code 140.011 (Tax Code 31, Tax Code 26, Tax Code 11, Local Government Code 140)