Texas Homestead Exemption Now $140,000: What to File in Austin
On November 4, 2025, Texas voters approved Proposition 13, and with it the largest homestead exemption increase in state history. The school district portion of the exemption jumped from $100,000 to $140,000 of your home’s value, and homeowners who are 65 or older or disabled now get $200,000 knocked off before school taxes are calculated. If you own the home you live in anywhere in the Austin area and you have never filed a homestead exemption, or you bought recently and are not sure whether one is in place, this is the year to fix that. The form is free, it takes about 20 minutes, and on a typical Austin home the savings run well over $1,000 a year.
The stakes are bigger than the tax bill itself. For most homeowners with a mortgage, property taxes flow through an escrow account, so the exemption directly changes the monthly payment you send your servicer. Miss the filing and you are overpaying every single month. At Mortgage Austin we see this most often with first-year buyers, because nobody tells them the exemption does not transfer from the previous owner.
Key points:
- The Texas school district homestead exemption is now $140,000, up from $100,000, after voters approved Proposition 13 in November 2025.
- Homeowners 65 and older or disabled get a $200,000 school district exemption plus a school tax ceiling.
- Filing is free. Form 50-114 goes to your county appraisal district (Travis, Williamson, or Hays for most Austin-area owners), and it renews automatically.
- The standard filing window closes April 30, but Texas accepts late applications for up to two years.
- Buyers can often claim the exemption in the year they purchase instead of waiting for January 1.
- On a median-priced Austin home (about $435,000 as of August 2026, per Team Price Real Estate), the exemption can trim roughly $115 or more off the monthly payment through escrow.
How much does the $140,000 homestead exemption save in Austin?
On a home at Austin’s median sold price of about $435,000 (Team Price Real Estate, August 7, 2026), the $140,000 exemption removes roughly a third of the value from the school district portion of your tax bill. At an illustrative school tax rate of $1.00 per $100 of taxable value, that is about $1,400 a year in savings, or roughly $117 a month. Owners 65 and older or disabled save about $2,000 a year at that same rate.
Here is the math side by side, using that $435,000 home and the illustrative $1.00 per $100 school rate. Your district’s actual rate will differ, so treat these as ballpark figures, not a quote of your bill.
| Scenario | School-taxable value | Annual school tax at $1.00 per $100 | Savings vs. no exemption |
|---|---|---|---|
| No homestead exemption | $435,000 | $4,350 | $0 |
| Standard $140,000 exemption | $295,000 | $2,950 | $1,400 per year |
| 65+ or disabled ($200,000 exemption) | $235,000 | $2,350 | $2,000 per year |
School taxes are only part of the picture. Many local taxing units layer their own homestead exemptions on top. Travis County and the City of Austin, for example, each offer a 20 percent local-option homestead exemption on their portions of the bill. The exemption also activates the 10 percent appraisal cap, which limits how fast your assessed value can rise each year while you own the home. Over several years of a rising market, that cap can be worth more than the exemption itself.
How do you file a homestead exemption in Texas?
You file Form 50-114, the Application for Residence Homestead Exemption, with the appraisal district in the county where the home sits. Filing is free, and most Austin-area owners can do it online through the Travis Central Appraisal District, Williamson Central Appraisal District, or Hays Central Appraisal District websites. You will need a Texas driver’s license or state ID showing the property address. Once approved, the exemption renews automatically each year.
Three practical notes. First, the address on your license has to match the property, so update your license before you file if you have not already. Second, you must own the home and occupy it as your principal residence; rental properties and second homes do not qualify. Third, ignore the official-looking mailers offering to file for $50 or more. The appraisal district processes the same form for free, and the companies sending those letters add nothing.
What is the deadline, and can you still file late?
The standard deadline is April 30 of the tax year. Missed it? Texas allows late homestead exemption applications for up to two years after the delinquency date, and the appraisal district will retroactively apply the exemption and refund the difference for qualifying years. So if you bought in 2024 or 2025 and never filed, you may be owed money back, not just savings going forward.
Filing late is common and there is no penalty. The only cost of waiting is the cash flow: your escrow account keeps collecting at the higher, unexempted tax amount until the exemption shows up on the county’s rolls.
Bought in 2026? You may not need to wait until January 1
Under a rule in place since 2022, buyers can claim a prorated homestead exemption in the year they purchase, as long as the property did not already carry an exemption for that year and they occupy it as their principal residence. If the previous owner had their own exemption in place, you generally keep the benefit of it through the end of the year, then your own application takes over.
Either way, file as soon as you close and your license is updated. New construction buyers should pay special attention here: if the county assessed the lot before your home was finished, your first-year tax bill may be based on land value only, and the jump in year two can be steep. The exemption softens that jump, and filing early keeps your servicer’s escrow projections closer to reality. If you are still shopping, our walkthrough of the 30 days from offer to keys covers where this step lands in the timeline.
The 65-and-over and disabled exemptions do more than raise the number
Homeowners who are 65 or older or who meet the disability definition get the $200,000 school district exemption, and they also get a school tax ceiling. The ceiling freezes the dollar amount of school taxes at the level of the year you qualify, so future rate or value increases cannot push that portion of the bill higher. The ceiling can even transfer, in percentage terms, to a new home if you move within Texas.
If you turned 65 recently, or a parent did, check the appraisal district record to confirm the correct exemption is coded. The over-65 exemption can apply from the year you turn 65, and it is one of the most commonly missed filings we hear about from clients reviewing a parent’s bill. Rates by county differ too; property taxes in Travis County, Williamson County, and Hays County each combine different school, county, city, and special-district rates, so two similar houses across a county line can carry very different bills.
What the exemption does to your mortgage payment
If you pay taxes through escrow, your servicer collects one-twelfth of the projected annual tax bill each month. When the exemption lands on the county rolls, the projected bill drops, and your next annual escrow analysis lowers the payment. Using the illustrative math above, that is roughly $117 a month back on a median-priced home, and often a one-time escrow surplus refund on top when the analysis catches up.
Two ways to speed that up. First, send your servicer the appraisal district’s exemption confirmation rather than waiting for the annual analysis; many will run an off-cycle review. Second, if you are budgeting for a purchase right now, remember that lenders qualify you using the actual expected tax bill, so the exemption feeds directly into how much house you can afford. In a market where the median price has come down about 21 percent from its 2022 peak (you can track the current numbers on our Austin housing market page), a $115-plus monthly swing is real buying power.
Frequently Asked Questions
How do I file a homestead exemption in Texas?
File Form 50-114 with the appraisal district in your county, such as Travis, Williamson, or Hays for the Austin area. Most districts accept the form online, and all accept mail or in-person filings. You need a Texas driver’s license or state ID that matches the property address, and the home must be your principal residence.
What is the deadline to file a homestead exemption in 2026?
The standard deadline is April 30 of the tax year. Texas also accepts late applications for up to two years after the delinquency date, and qualifying late filers receive a retroactive exemption and a refund of the overpaid amount for those years.
Do I have to pay someone to file my homestead exemption?
No. Filing is free directly with your county appraisal district, online or by mail. Companies that mail offers to file for a fee, often $50 or more, submit the same free form you can file yourself in about 20 minutes.
Does the homestead exemption lower my mortgage payment?
Yes, if your taxes are paid through escrow. The exemption reduces your projected tax bill, and your servicer’s escrow analysis then lowers the monthly payment. On a $435,000 home at an illustrative school tax rate of $1.00 per $100, the $140,000 exemption saves about $1,400 a year, or roughly $117 a month.
I bought my house this year. Do I have to wait until January 1 to file?
Usually not. Since 2022, Texas lets buyers claim a prorated homestead exemption in the year of purchase if the property did not already have an exemption for that year. If the seller’s exemption was in place, its benefit generally carries through the end of the year. File as soon as your Texas license shows the new address.
Do I need to refile my homestead exemption every year?
No. Once approved, the exemption renews automatically for as long as you own and occupy the home as your principal residence. Appraisal districts periodically audit exemptions and may ask you to confirm you still qualify, so respond to any verification letter promptly.
Wondering how the exemption, county tax rates, and today’s prices fit into your own numbers? Schedule a discovery call and we’ll walk through your options together, no pressure, no commitment, just clarity.
Ferrando Financial LLC | NMLS# 2403080 | Licensed in Texas. This content is for educational purposes only and does not constitute a commitment to lend. Loan approval is subject to credit, income, and property qualification. Property tax figures shown are illustrative estimates, not tax advice; actual exemptions, rates, and savings vary by taxing district and individual situation, so confirm details with your county appraisal district or a tax professional. Sources: Texas Proposition 13 (approved November 4, 2025); Texas Comptroller Form 50-114; Team Price Real Estate Austin market update, August 7, 2026.
