A possible increase in tax deduction from $100,000 to $140,000 could be experienced by citizens in one state. A huge tax deduction, if passed and approved by voters in November 2025, could see taxpaying homeowners in Texas paying far less taxes. This tax deduction, as per Senate Bill 4, is a bill that could increase the tax deduction on Texans’ homestead property taxes. All homeowners across Texas would thus be impacted, and they should consider what this huge change could mean for them.
Understanding the proposed increase in tax deduction
Currently, the homestead exemption tax in Texas is approximately $100,000. This tax deduction amount was a considerable increase from the tax deduction that initially existed. If Senate Bill 4 is to be passed, the tax exemption would increase to approximately $140,000.
This tax deduction increase would apply to over 5.7 million homeowners in the state starting in the 2025 tax year, thus allowing Texan homeowners to benefit almost immediately. The proposed bill also looks at offering a tax compression whereby the state will ensure that more money is sent to the school districts so as to make up for any loss in property tax revenue.
As has been said by Rep. Morgan Meyer (R-University Park), chairman of the committee, the bill will ensure that more money is put in the hands of Texan payers while not harming the school districts during this process.
Who else benefits if new bills are passed?
Homeowners in Pennsylvania also received tax relief as per the property tax rebate, and now, homeowner tax relief is being offered to citizens in Texas. Alongside this tax exemption of $140,000, Senate Bill 23 will further offer citizens over the age of 65 and those living with disabilities further tax relief.
Senate Bill 23 in the Texas Legislature will see a further reduction of the homestead exemption from the current amount of $10,000 to $60,000 for all homeowners. This homestead exemption for homeowners, along with the proposed $140,000 standard exemption, will enable all qualifying homeowners to exclude about $200,000 from the taxable value of their home.
As it stands, this bill will see approximately two million households benefit. In the process, elderly citizens and disabled homeowners will save approximately $938,72 annually when it comes to school district property taxes should Bill Senate Bill 4 and Bill Senate Bill 23 be signed into law.
Who will suffer if the new bills get passed?
Gov. Abbott is all in favor of this bill, saying that it could mean a serious triumph for all Texas taxpayers. While Gov. Abbott is all in favor of increasing the tax deduction for eligible homeowners in Texas, not everyone seems to feel the same. Some feel that the lost revenue from these tax deductions could result in Texas having to raise tax rates or cut services to make up for this lost stream of revenue.
Yet again, on the positive side, many Texas homeowners are looking forward to these bills being passed, as they could offer considerable relief to many taxpayers. This is inevitably all part of the state’s initiative to assist Texans to save due to the unpredictable rising cost of living.
Despite being deemed the largest tax relief plan in history, it is yet to be seen what the long-term stability of these tax relief plans could mean for Texans. Voting is said to take place in November 2025, where it will be decided by voters who are all for House Bill 4 and House Bill 23 being passed and who remain against the introduction of both bills.
Disclaimer: Our coverage of stimulus checks, tax reliefs, tax rebates, tax credits, and other payments is based on the official sources listed in the article. All payment amounts and dates, as well as eligibility requirements, are subject to change by the governing institutions. Always consult the official source we provide to stay up to date and obtain information for your decision-making.
