Let’s Talk Property Tax Relief

Everything you wanted to know about Compression, Exemptions, and more …

Compression: What is it? It’s simply reducing the school tax rate you personally pay by 5 to 20 cents (whatever it is in a particular session) and having the state pay the school district instead of you. We “compress” the rate for you and the state pays it. Compression is good, but very expensive because we do it for everyone who pays school taxes from homeowners to businesses. It can be reduced by any legislature in the future. It’s not lasting.

Exemptions: An exemption is permanently reducing the amount you are taxed on your home. If your home is valued at $250,000, you get a current exemption from the state of $40,000 so you are taxed on $210,000 instead of $250,000.

Some school districts and other taxing jurisdictions offer even more exemptions on top of the state’s $40,000. Remember, an exemption is permanent. Compression is not.

Here’s a short four-minute video where I explain the differences.

When I became Lt. Governor in 2015, the state homestead exemption had been $15,000 for many years. I’ve increased it to $40,000.

This session, the Senate plan is to increase your homestead exemption to $100,000. That means if you live in a $250,000 home you would only be taxed on $150,000. We also blend that exemption with compression to yield a much larger tax savings of about $1,250 – $1,450 annually. That’s about $1,250 – $1,450 a year every year you own your home. That could easily be $20,000 or more for you over your lifetime.

The current debate between the Texas Senate and me with the House and Speaker Phelan is that they don’t want to give you the $100,000 homestead exemption.

Big business is the big winner in the House’s plan. The Senate plan gives a boost to Texas homeowners through the exemption. The Governor now appears not to want to give you the $100,000 exemption either, but it’s not totally clear.

The House wants the entire $17.6 billion set aside for property tax relief to go exclusively into compression for every property owner including businesses. Under the House plan, you would only get $700 a year in tax savings. Under our Senate plan, with compression and exemptions, you get $1,250 – $1,450 a year in tax savings.

The Senate and I are fighting for the homeowners to get you the full $1,250 – $1,450 a year. That’s $700 more per year than the House, and apparently, the Governor, wants to give you.

Here’s a short four-minute video where I explain the differences.

Thank you all for your support and everything you do to keep Texas red. May God bless you and your family, and may He continue to bless the greatest state of all—Texas.


Dan Patrick

Dan Patrick
Lieutenant Governor of Texas