HB 3239

relating to the authority of the governing body of a taxing unit to
adopt an exemption from ad valorem taxation of a portion, expressed
as a dollar amount, of the appraised value of an individual's
residence homestead and to the adjustment of the exemption amount
in subsequent years to reflect inflation.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Section 11.13(n), Tax Code, is amended to read as
(n)  In addition to any other exemptions provided by this
section, an individual is entitled to an exemption from taxation by
a taxing unit of a portion, expressed as a dollar amount, [a
percentage] of the appraised value of the individual's [his]
residence homestead if the exemption is adopted by the governing
body of the taxing unit before July 1 in the manner provided by law
for official action by the body.  For the 2026 tax year, the amount
of the exemption may not exceed $100,000.  For each subsequent tax
year, the comptroller shall calculate the maximum amount of the
exemption by multiplying the maximum amount of the exemption under
this subsection for the preceding tax year by the inflation rate and
adding that amount to the maximum amount of the exemption for the
preceding tax year.  Each year, not later than March 15, the
comptroller shall publish the maximum amount of the exemption in
the Texas Register.  For purposes of this subsection, "inflation
rate" means the positive amount, if any, expressed in decimal form
rounded to the nearest thousandth, computed by determining the
percentage change in the Consumer Price Index for all Urban
Consumers (CPI-U), U.S. City Average, published by the Bureau of
Labor Statistics of the United States Department of Labor for the
preceding calendar year as compared to the calendar year preceding
that calendar year.  [If the percentage set by the taxing unit
produces an exemption in a tax year of less than $5,000 when applied
to a particular residence homestead, the individual is entitled to
an exemption of $5,000 of the appraised value.  The percentage
adopted by the taxing unit may not exceed 20 percent.]
SECTION 2.  Section 11.13(n-1), Tax Code, is repealed.
SECTION 3.  This Act applies only to ad valorem taxes imposed
for a tax year that begins on or after the effective date of this
SECTION 4.  This Act takes effect January 1, 2026, but only
if the constitutional amendment proposed by the 89th Legislature,
Regular Session, 2025, authorizing the governing body of a
political subdivision to adopt an exemption from ad valorem
taxation of a portion, expressed as a dollar amount, of the market
value of an individual's residence homestead and providing for the
adjustment of the exemption amount in subsequent years to reflect
inflation is approved by the voters.  If that amendment is not
approved by the voters, this Act has no effect.