If you're a Texan who is turning 65, and you have a homestead exemption, there's good news on your horizon – the Over 65 Property Tax Exemption! Let's explore what it is and how it works.

The Over 65 Exemption means an additional $10,000 exemption (at a minimum) from school district taxes. This is in addition to the $100,000 standard homestead exemption you already have. An even more important benefit however, is that the school district must put a ceiling on their tax. This ceiling is the amount of taxes you owe the year you turn 65 (and become approved). Therefore in subsequent years if the school tax rate goes up, or if your value increases, you will only be taxed by the school district at your ceiling. However, if the school district taxes go down below your ceiling in a given year, you will only be charged the lower amount for that year.

Additionally, it's worth noting that cities and various other taxing entities often provide exemptions for individuals over the age of 65 as well. While school districts and ISDs are required to offer tax ceilings as part of their exemption benefits, other taxing jurisdictions have the discretion to implement such ceilings as well. County taxing authorities commonly extend tax ceilings to eligible residents, though it's less typical for cities to do so. This variability underscores the importance of consulting with local tax authorities to understand the specific exemptions and tax ceiling options available in one's area.

Let's break it down with an example. In the year you turn 65, imagine your home is appraised at $400,000. With the homestead exemption of $100,000, and the Over 65 Exemption of $10,000, the total taxable value drops by $110,000. This means you'll only be taxed on $290,000. In addition, in the coming years the school district taxes will only be the amount that they were the year you were approved for the Over 65 exemption, but never higher. If your school district tax rate is 1.0%, your school taxes would never exceed $2,900 ($290,000 * 1%).

To qualify, you need to be 65 or older, and also qualified for a homestead exemption. Get the standard "Application for Residential Homestead Exemption" from your local county appraisal district or their website. Be sure to check off the qualification for Over 65 near the top, and return it in person or by mail. Be sure to include copies of any documents requested, such as your driver’s license. Remember to do this before the first anniversary of your qualification (65th birthday) to make sure you don't miss out on any savings. We actually recommend submitting the Over 65 application at the beginning of the year you turn 65, since you are eligible for the full exemption the year turn 65.

Many counties, if they have your driver’s license (and therefore birthday) on file, may actually notify you that they have applied the exemption without you filling out an application.

If you move to another home that will be your primary residence and you will own, your Over 65 homestead exemption takes effect immediately. (You will receive the standard homestead exemption, plus the over 65 exemption totalling at least $110,000). In addition, you will not lose the benefit of a property tax ceiling. The amount of the school tax ceiling for the home you are moving to is determined by:

1) Calculating what percentage of your current tax ceiling amount is of the total school tax amount that year, for the home you will be leaving. For example, if your school tax ceiling is $5,000 and the actual school tax that year is $10,000, then the percentage is 50%, because $5,000 is 50% of $10,000.

2)Applying that percentage to the total school tax that year for the home to which you will be moving. For example, if the total school tax for that home is $12,000, you calculate 50% of $12,000. Your new school tax ceiling will be $6,000. That means that the most school tax you will pay is $6,000. Alternatively if you are moving into a smaller home where the total school tax for that year is $8,000 you simply calculate using the same percentage (in this example 50%) which puts your tax ceiling at $4,000.

The Over 65 Exemption is a fantastic way for Texas to acknowledge and support its senior residents. It's a straightforward process that can significantly reduce your property tax burden, allowing you to enjoy your retirement without breaking the bank.

When we protest your taxes, our company makes sure to take into account all of your exemptions and ceilings when billing for any tax savings.