Municipal Utility District (MUD)
A Texas special district that finances and operates water, sewer, drainage, and similar utilities, often by levying its own property tax on the homes inside it.
A municipal utility district, or MUD, is a special-purpose political subdivision in Texas that provides utilities such as water, wastewater, and drainage, commonly in newly developed areas outside existing city services. A MUD can issue bonds for infrastructure and levy a property tax on the parcels within its boundaries to repay that debt and fund operations.
Because a MUD tax is added to the regular property tax bill, a buyer in a MUD can face a higher combined tax rate. Texas law requires a statutory notice to a buyer of residential property located in a MUD, disclosing the district and its tax rate.
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- 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.
- Property Tax Protest
A Texas owner's right to challenge the appraisal district's value or determinations before the appraisal review board.
- Seller's Disclosure Notice
The statutory Texas form on which a seller of most residential property discloses the property's known condition to the buyer.
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.