1. Own the property on January 1 of the tax year

2. Claim it as their primary residence

3. Claim no other property in Texas as a homestead

Age 65+ Homestead Exemption

Homeowners who attain age 65 are granted a much more significant homestead exemption.

The year in which the homeowner reaches age 65 is called the "freeze" year, the year in which a maximum tax limitation is placed on school district taxes. This "freeze" does not affect other taxing jurisdictions, only the school district in which the property is located.

However, most other tax jurisdictions do grant enhanced exemption amounts to over-65 homeowners. For instance, Austin Community College exempts $75,000 from taxation, the city of Austin exempts $51,000 and Travis county offers an additional $65,000 exemption to homeowners over age 65.

The age 65+ homestead exemption may be "transported" from one school district to another when the homeowner moves. The tax freeze (or upper limit of taxes) applies to the new school district at the same ratio of taxation as was the case in the prior school district. The rules regarding "transporting" of over-65 tax freezes are complicated.

The "10% Homestead Cap"

Texas voters passed a constitutional amendment in 1998 limiting the amount of annual increase in "taxable" value for a homestead to a maximum of 10% per year since the last reappraisal. As Travis CAD reappraises every year this effectively limits the amount of increase in "taxable" value to a maximum of 10% from one year to the next.

It is important to note that this does not limit the increase in "market" value, it limits only the increase in "taxable" value. Thus, your home's "market" value might be raised from $100,000 to $150,000 for tax year 2000, but the "taxable" value (which you actually pay taxes on) is limited to only $110,000.