The bill, H.B. No. 299, proposes amendments to the Tax Code regarding the appraisal value of residence homesteads for ad valorem tax purposes. It establishes that the appraised value for the first tax year a property owner qualifies for an exemption under Section 11.13 will be equal to the market value of the property. Subsequent appraisals will be limited to the lesser of the previous year's appraised value plus the market value of new improvements or a specified percentage increase. Additionally, if the property is acquired as a bona fide purchase, the purchase price will be considered the market value for the first tax year of exemption. The bill also introduces provisions for confidentiality regarding applications for appraisal limitations and specifies conditions under which these limitations may not expire, particularly in cases of inheritance.

The bill includes several insertions and deletions to clarify the appraisal process and the conditions under which the limitations apply. Notably, it states that the limitation on appraised value will not expire if ownership changes due to inheritance, provided the new owner qualifies for the exemption. The act is set to take effect on January 1, 2027, contingent upon the approval of a related constitutional amendment by voters. If the amendment is not approved, the bill will have no effect.

Statutes affected:
Introduced: Tax Code 23.23 (Tax Code 23)