Texas law allows for a homeowner to declare their principal residence as a homestead. Only the homeowner's principal residence qualifies and a homeowner can only declare 1 homestead in a given year. The homeowner files an application with the county appraisal district in order to have their primary home designated as homestead.
A homestead designation allows for several benefits, including:
- Creditor Protection for the Homeowner: Homesteads are generally not subject to forced sale by creditors
- Creditor Protection for the Homeowner's Survivors: The homestead claimant's surviving spouse and minor children are entitled to the same creditor protection after the claimant passes
- Special Occupancy Rights for Surviving Spouse & Minor Children: A homestead designation entitles a surviving spouse or minor children (in the event of death of both parents) the right to occupy & use the homestead. These rights can last for life, for the surviving spouse, or until the children are no longer minors, for minor children
- Property Tax Savings: The homestead allows for some property tax (also known as ad valorem taxes) savings for the homeowner. The amount of the discount varies by the taxing entity. For example, there is a $15,000 exemption when assessing school district taxes and counties provide varied additional exemptions when assessing county taxes (for example, Travis County allows a 20% exemption and Williamson County allows a $3,000 exemption)
Most people think about the property tax benefits when thinking about homestead designation. In order to obtain the property tax benefits, a homeowner must be using the home as their principal residence on January 1st of a given year and must file an application with the county any time between January 1st and April 30th. Once an exemption is received, the homeowner does not need to reapply unless the county appraisal district sends a new application. If the homeowner moves out of the home, they must inform the appraisal district before the next May 1st. Each county has their own forms and here is where you can find the forms for our surrounding counties:
- Travis County: Homestead Form
- Williamson County: Homestead Form
- Hays County: Homestead Form
- Bastrop County: Homestead Form
One thing to note is that it is completely free to file for a homestead. When you purchase a new home, you are likely to receive forms from companies that look like the standard homestead forms and asking for an amount (usually between $25 and $75) to file. These companies are just sending in the same forms that you can send in to the county, but they are charging you a fee for something that you can do for free. Save yourself the money and just send in the forms yourself.
If you have any questions about what a homestead is or how to apply for a homestead, please feel free to contact us