H.B. No. 202 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 corresponding to their disability rating percentage on the appraised value of their homestead. Surviving spouses of qualifying veterans, who have not remarried, are also entitled to the same exemption percentage, and they can retain this exemption even if they qualify a different property as their residence homestead.

Additionally, the bill modifies existing sections of the Tax Code to expand eligibility for property tax exemptions to include disabled veterans and their unmarried surviving spouses. It clarifies the calculation of local governments' lost ad valorem tax revenue by including the total appraised value of properties exempt under the new provisions. The bill is set to take effect on January 1, 2027, contingent upon the approval of a constitutional amendment that would allow for such exemptions based on the veteran's disability rating. If the amendment is not approved, the bill will have no 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 11, Tax Code 26, Local Government Code 140, Tax Code 31)