Texas Property Owners Can Get Tax Relief from Winter Storm Damage

Texas property owners can receive a temporary tax exemption for “qualified property” damaged during the February 2021 winter storm. The property must be at least 15 percent damaged, and property owners must apply for the temporary exemption no later than 105 days after the governor declares a disaster area.

Texas Governor Greg Abbott declared a state of disaster for all counties in Texas on February 12, 2021, setting May 28, 2021, as the deadline for filing for the exemption.

Qualified Property

The term “qualified property” refers to tangible personal property used for income production, improvements to real property, and certain manufactured homes. Additionally, for tangible personal property used for the production of income, the property must be the subject of a rendition statement or property report filed by the property owner that demonstrates that the property had taxable situs in the disaster area for the tax year in which the disaster occurred.

Damage Assessments and Exemptions

The owner may be eligible for a temporary exemption from taxation for the property if the chief appraiser assigns damage assessment to property that corresponds to an exemption that ranges from 15 percent to 100 percent of the appraised value of the property.

• 15-percent exemption: A “Level I” damage assessment applies to property that is 15 percent to 30 percent damaged, meaning that the property suffered minimal damage and may continue to be used as intended. A property with a Level I damage assessment will receive an exemption of 15 percent.
• 30-percent exemption: A “Level II” damage assessment applies to property that 30 percent to 50 percent damaged. This means that the property has suffered only nonstructural damage, including nonstructural damage to the roof, walls, foundation, or mechanical components, and any waterline is less than 18 inches above the floor. A property with a Level II damage assessment will receive an exemption of 30 percent.
• 60-percent exemption: A “Level III” damage assessment applies to property that is at least 60 percent damaged but is not a total loss. This means that the property has suffered significant structural damage requiring extensive repair due to the failure or partial failure of structural elements, wall elements, or the foundation, or the waterline is at least 18 inches above the floor. A property with a Level III damage assessment will receive an exemption of 60 percent.
• 100-percent exemption: A “Level IV” damage assessment applies to property that is a total loss. This property will receive a complete 100 percent exemption.

The amount of the exemption is determined by multiplying the property value by the exemption percentage, prorated by the number of days remaining in the year. If a particular property is qualified for a 30% exemption under this winter storm provision, then the applicable exemption would be reduced to 26% after prorating for the 323 days remaining in the year.

Claiming an Exemption

To claim an exemption, the taxpayer must file Form 50-312, Temporary Exemption Property Damaged by Disaster, available from the Texas Comptroller’s Office, with the chief appraiser for each appraisal district in which the property subject to the claimed exemption has situs.

For more information about the exemption, contact us. We are here to help.

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