H.B. No. 240 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. The bill specifies that "farm products" will now include eggs and timber, specifically standing timber, while removing the previous mention of livestock and poultry. Additionally, it redefines "in the hands of the producer" to clarify ownership and responsibility for farm products, distinguishing between general farm products and timber.

The bill is set to take effect on January 1, 2027, contingent upon the approval of a constitutional amendment proposed by the 89th Legislature in 2025. If the amendment is not approved by voters, the provisions of this Act will not take effect. This legislative change aims to provide clearer guidelines for the taxation of farm products, ensuring that producers understand their tax obligations and exemptions.

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