Understanding the Circuit Breaker Rule & How It Affects Your Texas Property Tax Protest
Understanding the Circuit Breaker Rule & How It Affects Your Texas Property Tax Protest
If you're a Texas property owner looking to reduce your tax bill, you may have heard about the Circuit Breaker Rule. This rule limits the increase in property taxes for certain homeowners, but it doesn’t apply to everyone. Understanding how it works—and how it affects your property tax protest—is key to maximizing your tax savings.
What Is the Circuit Breaker Rule?
The Circuit Breaker Rule is designed to protect homeowners from extreme increases in property taxes by capping how much their taxable value can rise in a given year. While it can be helpful for some, it doesn’t apply to all properties—and that’s where property tax protests come in.
How It Works in Texas:
✔️ If you have a homestead exemption, your assessed value can’t increase more than 10% per year—even if your market value skyrockets.
✔️ If your property doesn’t have a homestead exemption (such as a rental, investment property, or second home), there is no cap—meaning your tax bill can increase dramatically.
How the Circuit Breaker Rule Affects Your Tax Protest
If your home is covered under the Circuit Breaker Rule, you may think you’re protected from tax hikes—but that’s not always the case. Here’s why you should still protest your property taxes:
✅ Your Market Value Can Still Be Overstated
Even with a 10% cap, the true market value of your home may still be inflated, causing you to pay more than you should over time.
Protesting can reduce your market value, which lowers taxes for future years.
✅ Investment Properties & Rentals Are NOT Protected
If you own a rental property, vacation home, or second home, you have no tax increase cap—so protesting is the only way to limit massive tax hikes.
✅ Your Tax Rate May Still Go Up
Even if your assessed value is capped, tax rates can still change, increasing your total bill.
A successful tax protest ensures you’re only paying taxes on a fair value.
📢 What You Can Do to Protect Your Property Tax Bill
📌 Check Your 2024 Property Tax Assessment – If your market value seems too high, a protest could bring it down.
📌 Understand Your Homestead Exemption – If you qualify, you may get some protection—but you should still verify that your assessment is accurate.
📌 If You Own Rental or Investment Properties, File a Protest! – These properties have no protection, meaning your taxes can skyrocket unless you appeal.
📅 The deadline to file your Texas property tax protest is May 15. Start your appeal today to avoid overpaying!
📞 Contact Texas Tax Appeal for expert help with your protest.