Homestead Appraisal Cap (10%)
A Texas limit that holds the annual increase in the appraised value of a residence homestead to 10 percent, plus the value of new improvements.
The homestead appraisal cap limits how much the appraised value used for taxes on a residence homestead can rise from one year to the next. The increase is capped at 10 percent per year of the prior year's appraised value, plus the value of any new improvements added to the property. The cap is the Texas counterpart to other states' assessment caps.
The cap applies only to a qualified residence homestead, and it does not lower market value, only the capped appraised value used to compute taxes. When the home is sold, the capped value generally resets the year after the sale.
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- Homestead Exemption (Texas Tax)
A Texas property tax break that lowers the taxable value of an owner's primary residence, reducing the school and other taxes owed.
- Property Tax Protest
A Texas owner's right to challenge the appraisal district's value or determinations before the appraisal review board.
- Ad Valorem Tax
A property tax based on the appraised value of real estate, set as of January 1 and paid in arrears in Texas.
This definition is Texas real estate exam-prep education, not legal, tax, or professional advice. Verify current rules against the official source before relying on them for a real transaction. Back to the full glossary.