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If you need help paying property taxes, you are not alone. Each year, over 300,000 Texas property owners are unable to pay their property taxes. Navigating the road of property tax assistance can be a difficult one. While a property tax loan might be the quickest and easiest way to solve your tax problem, property owners should also be aware of all the other options available through their respective tax assessors/collectors.
The Texas Tax Code provides several property tax payment options for people who need property tax help. While most of these payment options have requirements to qualify, and some are available only at the discretion of the tax assessor, they are still worth investigating. Below we lay out the different property tax assistance options available based on the Texas Tax Code and some of the pros and cons of each.
Your tax assessor may offer a payment plan if you cannot pay your property tax bill in full. Tax Code Section 33.02 covers payment plan agreements with your tax assessor for delinquent property taxes. Property tax payment plans are available for residential homestead and non-homestead properties. However, non-homestead properties still incur all penalties and interest, while plans for homestead properties only incur interest for the duration of the payment plan. You cannot have entered a payment plan in the last 24 months to qualify for the plan. You will make monthly payments in equal installments as part of the payment plan. If you fail to make payments per the agreement, the tax assessor can impose additional penalties, plus attorney fees of up to 20%, to your tax bill. The statute states the tax assessor may allow a payment plan, but they do not have to. Some tax assessors do not offer any payment plans, while others may offer one with a substantial down payment and a short repayment period.
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Tax Code Section 31.03 grants the tax assessor the option to allow a person to pay one-half of the taxes by November 30th and then pay the remaining one-half of the taxes by June 30th without incurring penalty and interest. If you fail to make the second payment before July 1st, the second payment is delinquent and incurs a penalty of twelve percent of the amount of unpaid tax.
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Like the split payment plan, the installment plan allows you to pay your property taxes without incurring any penalty or interest. What’s different about this plan is you can split the payment into four equal installments. Installment plans are available for those disabled, age 65 or older, or disabled veterans or their unmarried surviving spouses who qualify for an exemption under Tax Code Section 11.22; or partially disabled veterans with homes donated by charitable organizations and their unmarried surviving spouses. If the delinquency date is February 1st, the first installment must be paid before the delinquency date and accompanied by notice to the taxing unit that the property owner intends to pay the remaining taxes in three equal installments. The second installment is due before April 1st. The third installment is due before June 1st. The fourth and final installment is due before August 1st. If you miss a payment, the unpaid installment is delinquent and incurs a 6% penalty and interest in the amount of 1% a month until paid.
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If you are 65 or older, disabled, or a person who qualifies for a disabled veteran exemption, under Tax Code Section 11.22, you can defer the property tax on your residence homestead. Additionally, under specific circumstances, the surviving spouse of an individual who deferred payment of taxes may continue to receive the deferral. Tax Code Section 33.06 allows an individual entitled under this section to defer the collection of property tax, abate a suit to collect delinquent property taxes, and stop the foreclosure of a tax lien. The taxes do not go away. Instead, your taxes are deferred or postponed until you no longer occupy the property or die. Once this happens, you or your heirs will have 180 days to pay the tax bill. Contact the chief appraiser for your tax appraisal district to apply for a deferral.
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You can pay your property taxes with your credit card. Tax Code Section 31.06 requires a collector to accept payment by credit card and allows the collector to collect a fee for processing the payment.
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Establishing an escrow agreement with your tax assessor allows you to prepay your next property tax bill. Tax Code Section 31.072 allows the tax assessor to enter into a contract with a property owner to establish an escrow account. The property owner then deposits money in an escrow account maintained by the collector to pay property taxes.
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If you can pay a portion of your property tax bill, Tax Code Section 31.07 allows a collector to adopt a policy of accepting partial payments of property taxes. Unfortunately, acceptance of a partial payment does not affect the date that the tax becomes delinquent.
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Tax Code Section 32.06 allows a property owner to borrow the funds to pay their property taxes from a licensed property tax lender. The tax lender pays the tax assessor the total amount owed and gives the property owner a payment plan to pay back the money over time. Closing costs are part of a property tax loan and rolled into the loan, so there is no out-of-pocket expense. The repayment plans are usually long enough to allow for low monthly payments.
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