H.B. No. 273 seeks to amend the Texas Tax Code by adding a new section, 11.262, which allows specific taxing units—excluding school districts, counties, municipalities, and junior college districts—to impose limits on ad valorem taxes for the residence homesteads of low-income individuals who are elderly or disabled, as well as their surviving spouses. The bill defines "eligible individual" as someone whose household income does not exceed 200% of the federal poverty level and establishes that these limitations will only apply to qualifying taxing units that set a cap on the total taxes imposed on the homesteads of eligible individuals. It also outlines the appraisal process for these properties and stipulates that if the calculated tax exceeds the established limit, the tax will be capped accordingly.

Furthermore, the bill includes provisions regarding tax increases related to improvements made to the homestead, conditions under which the tax limitation may expire, and the rights of surviving spouses to maintain the tax limitation after the death of the eligible individual. It amends existing sections of the Tax Code to incorporate references to the new section 11.262, ensuring clarity in the application of tax limitations to cooperative housing corporations. The bill is set to take effect on January 1, 2027, contingent upon the approval of a constitutional amendment proposed by the 89th Legislature, which would authorize the limitation on ad valorem taxes for the specified low-income individuals. If the amendment is not approved by voters, the provisions of this bill will not take effect.

Statutes affected:
Introduced: Tax Code 23.19, Tax Code 26.012 (Tax Code 23, Tax Code 26)