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Bill would refund taxes on homes sold under appraised value

By   /   February 16, 2017  /   News  /   No Comments

Homeowners whose properties sell at prices below the values set by the local appraisal district would get a tax refund under legislation pending in the Texas House.

House Bill 1660 would trigger refunds for homesteaded properties when they sell for at least 10 percent below the official appraised value.

Texas Legislature photo

CUT A BREAK: State Rep. Dade Phelan says Texans deserve a property tax refund when their homes sell for under appraised value.

“This would level the playing field in an appraisal system that works in favor of districts instead of taxpayers,” said state Rep. Dade Phelan, the bill sponsor.

Phelan, who works in commercial real estate, cited cases where new subdivisions go up next to older neighborhoods and inflate the “comps” used by county appraisers.

“It’s hard to build a 3,000-square-foot home for less than $160 per foot, but you have existing homes nearby selling for $70 per foot,” said Phelan, a Beaumont Republican.

Cheryl Johnson, tax assessor for Galveston County, said HB 1660 “will force accountability and may even alleviate the wild increases occurring simply because appraisal districts can raise values despite homeowner protests.”

Overvaluation of residential property was a common complaint at statewide hearings conducted by the Senate Select Committee on Property Tax Reform and Relief last year.

The Texas Association of Appraisal Districts calls below-appraisal sales “very rare.”

“If there’s a difference in prices, it’s usually higher on the flip side,” TAAD President Brent South told Watchdog.org.

South said the bill’s provision authorizing refunds going back two years could be problematic.

“Say there’s a structural or foundation problem that causes a home to sell for less. What if that didn’t exist two years ago?” he asked.

Mike Amezquita, chief appraiser for Bexar County, said he would not oppose a one-year look-back.

“I don’t like it affecting prior years, but it’s not a big deal to me,” Amezquita said. “I think the state’s appraisal system gives way more favorable treatment to commercial property than it does to residential.”

From a tax collection standpoint, tax collector Johnson noted, “Corrections are made and refunds are issued throughout the year — going back five years now.”

Kenric Ward writes for the Texas Bureau of Watchdog.org. Contact him at [email protected] and follow him on Twitter @Kenricward.


Kenric Ward was a former San Antonio-based reporter for Watchdog.org.