Facts Page


Homestead Exemption

I am guessing that this post was sent to me since I am quoted in it. I am not going to get into Mr. Fowler’s homestead exemption; I am going to write about the homestead exemption itself and specifically about the most common: the Residence Homestead exemption.

This Facts Page entry is in response to the bathroom law that was screenshotted. The comments state you can pick the property you want to have a residential homestead exemption on are factually wrong. The law might have been that way in the past, but current law states otherwise. Current law states for a property to qualify for a residential homestead exemption, it must be owned and lived in by the person making the application. Now there are certain cases where the residential homestead exemptions can qualify for surviving spouses, qualifying trusts, and qualified individuals.

The homestead law had a revision in 2011 to reduce the amount of fraud, https://www.amarillo.com/news/local-news/2011-08-29/tax-law-aims-reduce-homestead-fraud.  Recently a Justice of the Peace was arrested for homestead exemption fraud, https://www.star-telegram.com/news/local/community/fort-worth/article218793535.html.  The bottom of the TAD form states:

NOTICE REGARDING PENALTIES FOR MAKING OR FILING AN APPLICATION CONTAINING A FALSE STATEMENT:  If you make a false statement on this form, you could be found guilty of a Class A misdemeanor or a state jail felony under Penal Code Section 37.10. By signing this application you state that each fact contained in this application is true and correct; (2) that I/the property owner meet(s) the qualifications under Texas law for the residence homestead exemption for which I am applying; (3) that I do not claim an exemption on another residence homestead in Texas or claim a residence homestead exemption on a residence homestead outside Texas; and (4) that have read and understand the Notice Regarding Penalties for Making or Filing an Application Containing a False Statement.”

The Residence Homestead exemption is found in the Tax Code, Title 1. Property Tax Code, Subtitle C. Taxable Property and Exemptions, Chapter 11. Taxable Property and Exemptions, Subchapter A. Taxable Property, Sec. 11.13,  Texas Property Tax Code

In the above post Ms. Corbin states that the homestead exemption is filed with the county where the property is located and is used for a property exemption and to protect it from creditors. I can confirm that the homestead is used for property tax exemption.  The protection from creditors is in several areas like the Texas Constitution and Property Code. I do not want to bore people with all the areas in law and will stick with the Tax Code.

To establish a Residence Homestead Exemption, the state has Form 50-114, named, the Residence Homestead Exemption Application. The 2nd line in the application asks, “Do you town and live in the property for which you are seeking this residence homestead exemption?” and the tax year for the exemption. On page 3 in the Exemption Qualifications, General Residence Homestead Exemption (Tax Code Section 11.13(a) and (b)) states:

"Property was owned and occupied as owner’s principal residence on Jan. 1. No residence homestead exemption can be claimed by the property owner on any other property."

The Tarrant Appraisal District, TAD, has it’s own form 2019 Application for Residential Homestead Exemption, https://www.tad.org/wp-contentpdf/templates/HomesteadApplication2019.pdf, step 3 has the property question as this:

"Do you own and live in the property for which you are seeking this residence homestead exemption?"

Going further into sec. 11.13 (j), provides the definition of a “Residence Homestead”

(j) For purposes of this section:

(1) "Residence homestead" means a structure (including a mobile home) or a separately secured and occupied portion of a structure (together with the land, not to exceed 20 acres, and improvements used in the residential occupancy of the structure, if the structure and the land and improvements have identical ownership) that:

(A) is owned by one or more individuals, either directly or through a beneficial interest in a qualifying trust;

(B) is designed or adapted for human residence;

(C) is used as a residence; and

(D) is occupied as the individual's principal residence by an owner, by an owner's surviving spouse who has a life estate in the property, or, for property owned through a beneficial interest in a qualifying trust, by a trustor or beneficiary of the trust who qualifies for the exemption.

(2) "Trustor" means a person who transfers an interest in real or personal property to a qualifying trust, whether during the person's lifetime or at death, or the person's spouse.

(3) "Qualifying trust" means a trust:

(A) in which the agreement, will, or court order creating the trust, an instrument transferring property to the trust, or any other agreement that is binding on the trustee provides that the trustor of the trust or a beneficiary of the trust has the right to use and occupy as the trustor's or beneficiary's principal residence residential property rent free and without charge except for taxes and other costs and expenses specified in the instrument or court order:

(i) for life;

(ii) for the lesser of life or a term of years; or

(iii) until the date the trust is revoked or terminated by an instrument or court order that describes the property with sufficient certainty to identify it and is recorded in the real property records of the county in which the property is located; and

(B) that acquires the property in an instrument of title or under a court order that:

(i) describes the property with sufficient certainty to identify it and the interest acquired; and

(ii) is recorded in the real property records of the county in which the property is located.

In Sec. 11.13, it relates to the renting portion of a qualified residential structure.

(k) A qualified residential structure does not lose its character as a residence homestead if a portion of the structure is rented to another or is used primarily for other purposes that are incompatible with the owner's residential use of the structure. However, the amount of any residence homestead exemption does not apply to the value of that portion of the structure that is used primarily for purposes that are incompatible with the owner's residential use.

As you can see that it is a portion of the house that is rented, similar to a room, but it is still the primary residence of the homestead application to qualify as residence homestead.

The vacating of a qualified residential structure is covered in Sec. 11.13 (l):

(l) A qualified residential structure does not lose its character as a residence homestead when the owner who qualifies for the exemption temporarily stops occupying it as a principal residence if that owner does not establish a different principal residence and the absence is:

(1) for a period of less than two years and the owner intends to return and occupy the structure as the owner's principal residence; or

(2) caused by the owner's:

(A) military service inside or outside of the United States as a member of the armed forces of the United States or of this state; or

(B) residency in a facility that provides services related to health, infirmity, or aging.

The key points here are in a period less than 2 years and the owner intends to move back in and use it a primary residence, or the military sends you somewhere else, or you are in a medical facility.

It is the responsibility of the owner of the property to notify the chief appraiser of a change in qualification status. That is in Sec. 11.43 titled Application for Exemption. Subsection (c) relates to an exemption covered under Section 11.13:

(c) An exemption provided by Section 11.13, 11.131, 11.132, 11.133, 11.134, 11.17, 11.18, 11.182, 11.1827, 11.183, 11.19, 11.20, 11.21, 11.22, 11.23(a), (h), (j), (j-1), or (m), 11.231, 11.254, 11.27, 11.271, 11.29, 11.30, 11.31, or 11.315, once allowed, need not be claimed in subsequent years, and except as otherwise provided by Subsection (e), the exemption applies to the property until it changes ownership or the person's qualification for the exemption changes. However, except as provided by Subsection (r), the chief appraiser may require a person allowed one of the exemptions in a prior year to file a new application to confirm the person's current qualification for the exemption by delivering a written notice that a new application is required, accompanied by an appropriate application form, to the person previously allowed the exemption. If the person previously allowed the exemption is 65 years of age or older, the chief appraiser may not cancel the exemption due to the person's failure to file the new application unless the chief appraiser complies with the requirements of Subsection (q), if applicable.


Introducing Fathom

A couple of days ago I was sent a screenshot of a thread from the Haltom city water bill Facebook page. The post was from Stacey Corbin concerning the council members and city staff that discovered Fathom at TML, Texas Municipal League, conference in 2016. In her post she states that I was one of the individuals that went to Fathom’s booth and gave my approval. This is furthest from the truth. I did not know about Fathom until it was introduced in March 2017. 

In that post Ms. Corbin states that Councilwoman Jeannie Nunn saw the Fathom booth and found it looked interesting. She then mentioned to me and Assistant City Manager Rex Phelps and we all went over to get more information and Rex and I really liked it. Well that did not happen, I did not go to the Fathom booth. I contacted Mr. Phelps to confirm my memory and then called Councilwoman Nunn about the post. Councilwoman Nunn stated that she had talked to Ms. Corbin and told her that I also visited the Fathom booth. I told her, since she and her husband, Gary Nunn, are both members of that page, they should set the record straight. I told Councilwoman Nunn that I am going to write a rebuttal.

So far, I have not been sent a screenshot of the correction.  I will update this post when I do.

This is first of many posts, to shine truth to the false information that is being spread.

Update ----  I would like to thank Ms. Corbin for her post on correcting the parties that introduced Fathom to Haltom City.


Tax Rates

Ms. Corbin’s post is a long one, so I am going to address the tax rate first. Ms. Corbin states that Haltom City is the only one in our metroplex whose taxes had gone up every single year for 5 straight years. That is factually false information. This information is readily available from several sources.

The Tarrant County Appraisal Distract, TAD, has a page dedicated to the current rates for the taxing entities in the county and the rates going back to 2003. Another source are the minutes for the different municipalities in the metroplex. Now this is a little more difficult, due to the fact that you have to go to each of their web sites to download the minutes or make a request using the Open Records Request, which Ms. Corbin has done many times in Haltom City.

I have conducted my own research on this matter and here are the results. For this I looked at Haltom City and the cities that are adjacent to Haltom City, Fort Worth, North Richland Hills, Richland Hills, and Watauga.

The simplified version of the way property taxes is assessed, is a rate is set and that rate is applied to the taxable value of your property. The taxable value is what the value of the property minus any exemptions you have. 

The table is containing information from the TAD of the tax rates going back 5 years. From the table you can see that from 2013 to 2014 the rates remained the same for all the cities. So, if your property value increased, then your property tax increased.

2014 to 2015, Haltom City, Fort Worth, and North Richland Hills all kept their rates the same and Richland Hills and Watauga increased their rates, a definite tax increase for all the cites listed.

2015 to 2016, Haltom City and North Richland Hills rates remained the same, Fort Worth decreased their rates by .02 cents, -2.34% and Watauga decreased their rate by .000307 cents for a -.05% change. I did not look at the minutes for the 2016 year, I did for the 2018 year, which we will see, but it is safe to say all the cities had an increase in property taxes.

2016 to 2017, all the cities listed had a decrease in their tax rates. Haltom City decreased by 0.3181, -4.54%, Fort Worth went down by 0.03 cents, -3.59%, North Richland Hills decreased by 0.02, -3.28%, Richland Hills decreased by 0.31895, -5.35% and Watauga went down by 0.16623, -2.69%. With these rate decreases all the cities had a tax increase.

2017 to 2018, all but one city reduced their rates. Haltom City down by 0.01518, -2.27%, Fort Worth lowered by 0.02, -2.48%, North Richland Hills down by 0.005, -0.85%, Richland Hills down by 0.02858, -3.88% and Watauga had no change in its tax rate.

I gathered the 2018 council minutes from Fort Worth, North Richland Hills, Richland Hills and Watauga and the video of the council meeting when the tax rates were set in North Richland Hills and Watauga, where they set the tax rate for the next year. When setting the tax rate, if the taxing entity is not using the effective tax rate, the rate that would bring in the same amount of revenue as the current year, because of the truth in taxation law, you must use the tax verbiage that is set in the sec. 26.05 (b) of the Texas Tax Code. It states, "I move that the property tax rate be increased by the adoption of a tax rate of (specify tax rate), which is effectively a (insert percentage by which the proposed tax rate exceeds the effective tax rate) percent increase in the tax rate."

Besides the minutes, I also downloaded the video of the council meeting when the tax rates were set in North Richland Hills and Watauga.

What this shows that even Richland Hills with the greatest percentage drop in rates had a tax increase. In politics, do not believe what is said, believe what can be proven.

Since I had started this post, I had talked to Ms. Corbin and let her know that she has her facts wrong about the tax rates. She has since made a post correcting the Fathom introduction and stated that she is conducting further research in the tax rates. I applaud her in digging into the weeds and understanding how the tax rates are set.