What Texas heirs need to know about property taxes on inherited homes

O’Connor breaks down how inheriting a home in Texas can trigger property-tax changes, especially during probate and after exemptions expire. The guidance focuses on homestead protections, appraisal reviews and appeals that can help heirs avoid paying more than necessary.

Why it matters: - Inheriting a Texas home can quickly turn into a tax issue because property taxes may rise when ownership changes and exemptions fall off. - Texas has some of the highest property taxes in the country, so missed exemptions or appraisal errors can materially increase a new owner’s bill. - Heirs who act fast on homestead filings, appraisal reviews and protests can limit unexpected costs.

What happened: - O’Connor outlined the property tax implications of inheriting a home in Texas. - The guidance focuses on what happens when a home transfers after a relative dies, including probate, exemptions and post-inheritance tax responsibilities. - Texas does not impose an estate tax or inheritance tax. - The federal estate tax generally applies only to estates over $15 million.

The details: - Most homes in Texas still go through probate unless a deed transfers automatically to an heir or trust. - During probate, the home becomes part of the deceased person’s estate, and creditors or other claimants may file against the estate. - When a probate notice is filed, the local appraisal district lists the home in the name of the estate. - Property tax exemptions often expire while the home is in probate. - The estate is responsible for paying property taxes during probate, with the executor using estate funds for any outstanding bills. - Homestead and over-65 exemptions may no longer apply during probate. - The loss of the homestead exemption can remove the 10% appraisal cap, which can push the taxable value up to full market value. - After probate ends, the heir becomes responsible for property taxes, HOA fees and upkeep. - If the inherited home has a mortgage, property taxes may be collected through monthly escrow payments. - If the home is paid off, the heir must pay the full annual tax bill directly. - The first priority after taking ownership should be filing for a homestead exemption. - To qualify, the inherited home must be the heir’s primary residence. - A homeowner cannot hold two homestead exemptions at the same time. - First-time homeowners must file a homestead application with the local appraisal district and provide supporting documents such as a Texas driver’s license and a deed. - The homestead exemption shields $140,000 of a home’s value from school taxes. - The homestead exemption also limits appraisal growth to 10% per year. - Local taxing entities may offer additional minor homestead exemptions. - The over-65 exemption provides an additional $60,000 exemption from school taxes. - The over-65 exemption can be combined with the homestead exemption for a total school-tax exemption of $200,000. - The disabled person’s exemption works like the over-65 exemption but cannot be used at the same time. - These exemptions should be claimed within 30 days of taking over a home. - Appraisal districts can make mistakes on measurements, improvements, acreage and other data. - New homeowners should verify the appraisal record and the annual April notice of appraisal. - The owner’s name and exemptions should be checked first, because an estate name or deceased owner name can drive higher taxes. - If factual errors or inflated valuations appear, the homeowner can file a property tax protest or appeal. - Appeals can also address unequal appraisals compared with similar neighboring properties. - Many Texas homeowners appeal every year because of the state’s high property taxes.

Between the lines: - The main risk for heirs is not the inheritance itself, but the administrative reset that can happen when a home moves from an estate to a new owner. - The homestead exemption is the key tax shield in this process, and failing to secure it can leave savings on the table. - Appraisal districts’ records matter as much as the law, because small clerical errors can compound into years of higher tax bills.

What's next: - Heirs should review probate status, confirm the appraisal record and file any available exemptions as soon as ownership changes. - Property owners who spot errors or overvaluation should consider a protest to preserve lower tax treatment. - O’Connor is offering help through its Property Tax Protection Program, with no upfront fee and no fee unless property taxes are reduced.

The bottom line: - Inheriting a Texas home can create a sharp property-tax jump unless the new owner moves quickly on homestead exemptions, record checks and appeals.