Austin Property Tax: Rates, Exemptions, and Collection

Property tax in the Austin area is the primary mechanism through which local governments, school districts, and special-purpose districts fund public services — from road maintenance to public safety to K–12 education. This page explains how tax rates are set and applied, which exemptions reduce liability, how the collection process works, and where jurisdictional boundaries determine which entities have the authority to levy. It draws on Texas state law, Travis County administrative structure, and the overlapping taxing entities that affect Austin-area property owners.

• Definition and scope
• Core mechanics or structure
• Causal relationships or drivers
• Classification boundaries
• Tradeoffs and tensions
• Common misconceptions
• Checklist or steps
• Reference table or matrix
• References

Definition and scope

Texas property tax is an ad valorem tax — a levy calculated as a percentage of a property's appraised market value. In Austin, that appraised value is determined annually by the Travis Central Appraisal District (TCAD), an independent agency established under Texas Tax Code Chapter 6. TCAD does not set tax rates and does not collect taxes; its sole statutory function is to appraise all taxable property within Travis County at 100 percent of market value as of January 1 each year.

Scope and coverage: This page addresses property located within Travis County, which encompasses the City of Austin and a ring of smaller municipalities. Properties in Williamson County (covering Round Rock, Cedar Park, Georgetown, and Leander), Hays County (covering Kyle, Buda, and San Marcos), and other surrounding counties fall under separate appraisal districts and are not covered here. Bastrop County and Caldwell County properties are likewise outside the scope of this page. Even for Travis County properties, the City of Austin tax rate applies only to parcels within Austin's city limits — unincorporated areas of Travis County or other incorporated cities within the county have different municipal rate components.

Core mechanics or structure

Appraisal: TCAD appraises all real property (land and improvements), business personal property, and mineral rights within Travis County. Property owners who dispute their appraised value may file a protest with the Appraisal Review Board (ARB), an independent panel that hears evidence and issues binding determinations.

Rate adoption: Each taxing entity — the City of Austin, Austin Independent School District, Travis County, Austin Community College District, and special districts — independently adopts its own tax rate each fall. Under Texas Tax Code §26.04, the no-new-revenue rate (formerly "effective tax rate") is the calculated rate that would produce the same levy as the prior year on the same properties. A taxing unit that wishes to raise more total revenue than the no-new-revenue rate allows must hold a public hearing.

Voter-approval rate: Senate Bill 2 (86th Texas Legislature, 2019) reduced the voter-approval tax rate threshold for most taxing units from 8 percent to 3.5 percent above the no-new-revenue rate (Texas Comptroller, Property Tax Basics). School districts operate under a separate 2.5 percent threshold. If a taxing unit adopts a rate exceeding the voter-approval threshold, registered voters may petition for a rollback election.

Collection: The Travis County Tax Assessor-Collector collects property taxes on behalf of all taxing entities in Travis County under a consolidated billing system. Tax statements are mailed in October, with the full amount due by January 31 of the following year. After January 31, a 6 percent penalty plus 1 percent per month interest applies under Texas Tax Code §33.01. If taxes remain unpaid after July 1, an additional 20 percent attorney collection fee attaches.

Causal relationships or drivers

Several structural forces drive year-to-year changes in Austin-area property tax bills:

Appraisal growth: Rising real estate prices in the Austin metro push market-value appraisals upward. TCAD's appraisals track the sales market, meaning periods of rapid price appreciation — such as the 2020–2022 Austin housing surge — translate directly into higher appraised values and, absent exemption offsets or rate reductions, larger tax bills.

Homestead exemption cap: Texas law caps the annual increase in the appraised value of a homestead at 10 percent, regardless of market movement (Texas Tax Code §23.23). This cap does not apply to the land portion of the appraisal, nor does it apply to the first year the homestead exemption is granted.

Taxing unit budget needs: Local governments set rates based on their annual budget requirements. Austin's budget process involves the City Council adopting a rate that, combined with the appraisal base, produces sufficient revenue for adopted expenditures. Bonds approved by voters — tracked through Austin's bonds and debt framework — can also affect debt service rate components.

State compression of school rates: Under House Bill 3 (86th Texas Legislature, 2019), the state increased school finance contributions in exchange for mandatory reductions in school district maintenance-and-operations (M&O) tax rates. This compression reduces the school district portion of the total effective rate but does not eliminate the school district tax levy.

Classification boundaries

Austin-area property is classified into categories that determine applicable exemptions and appraisal methods:

• Residential homestead: Owner-occupied primary residence. Eligible for the general homestead exemption, over-65 exemption, disabled person exemption, and the 10 percent annual appraisal cap.
• Agricultural land (ag-use or open-space): Appraised at productivity value rather than market value under Texas Tax Code §23.41 (ag-use) or §23.51 (open-space). Conversion to non-agricultural use triggers a rollback tax covering 5 prior years plus interest.
• Commercial and industrial real property: Appraised at market value with limited exemption access. Subject to Chapter 313 or Chapter 312 value limitation agreements under applicable Economic Development Act provisions, though Chapter 313 expired for new agreements after December 31, 2022 (Texas Comptroller, Chapter 313 Overview).
• Business personal property (BPP): Tangible personal property used in producing income. Reported annually by the business owner to TCAD; subject to the same rates as real property.
• Exempt property: Includes property owned by governmental entities, religious organizations, and qualifying nonprofits under Texas Tax Code Chapter 11.

Tradeoffs and tensions

Rate compression vs. local fiscal autonomy: Senate Bill 2's 3.5 percent voter-approval threshold constrains a city's ability to raise revenue in high-growth periods without triggering an election. Cities experiencing rapid population growth argue that infrastructure demand outpaces what a capped rate allows them to fund without voter approval.

Homestead cap and market equity: The 10 percent appraisal cap protects long-term homeowners from sudden tax spikes but creates appraisal inequity — two identical homes on the same block can carry vastly different taxable values depending on how long each owner has held the property. New purchasers receive appraisals at full market value in the first year, creating a structural disadvantage relative to long-term neighbors.

Agricultural valuation and land conversion pressure: Ag-use appraisals reduce tax liability for large landholders on the urban fringe, which can subsidize holding land off the market. When that land eventually develops, rollback taxes recapture some foregone revenue, but the 5-year lookback may understate the full subsidy period.

School district reliance: Across most Travis County parcels, the Austin ISD or other school district component constitutes the largest single share of the total tax rate — historically over 40 percent of the combined levy for many urban parcels. State compression reduces this over time, but the school district rate remains the dominant driver of total burden.

Common misconceptions

Misconception: TCAD sets the tax rate.
TCAD appraises property values only. Each taxing entity independently adopts its own rate. A higher TCAD appraisal does not automatically produce a higher tax bill if adopting entities reduce their rates proportionally.

Misconception: The homestead exemption is automatic.
The general homestead exemption requires a one-time application filed with TCAD. It is not applied automatically upon purchase. Owners must occupy the property as their principal residence on January 1 of the application year (TCAD Homestead Exemption Application).

Misconception: Paying taxes late simply accrues a flat penalty.
Late payment triggers a graduated penalty-and-interest structure. A 6 percent penalty attaches February 1, followed by 1 percent interest per month. After July 1, delinquent accounts referred to a collection attorney incur an additional 20 percent attorney fee on the total amount owed (Texas Tax Code §33.07).

Misconception: Travis County collects taxes only for Travis County government.
The Travis County Tax Assessor-Collector serves as the collection agent for all taxing units in the county — Austin ISD, Austin Community College District, the City of Austin, Travis County itself, and special districts such as municipal utility districts (MUDs). A single consolidated statement covers all applicable entities.

Misconception: Properties in Pflugerville or Manor that carry an Austin address are taxed by Austin.
Postal addresses do not determine tax jurisdiction. A property in Pflugerville city limits within Travis County pays Pflugerville's municipal rate, not Austin's. Properties in Manor similarly pay Manor's rate. The /index for this site provides broader context on Austin-area jurisdictional distinctions.

Checklist or steps

The following is the standard sequence of events in the annual Travis County property tax cycle:

1. January 1 — Ownership and use status as of this date determines exemption eligibility for the tax year.
2. January–April — TCAD completes appraisals and mails notices of appraised value to property owners.
3. Protest deadline — Property owners have until May 15, or 30 days after the notice of appraised value is mailed (whichever is later), to file a protest with the Appraisal Review Board (Texas Tax Code §41.44).
4. May–July — ARB hears protests and issues determinations; property owners may accept, negotiate informally, or proceed to a formal hearing.
5. July–August — TCAD certifies the appraisal roll to each taxing entity.
6. August–September — Taxing entities publish proposed tax rates and hold required public hearings.
7. September–October — Governing bodies (City Council, school board trustees, county commissioners) adopt final tax rates.
8. October–November — Travis County Tax Assessor-Collector mails consolidated tax statements.
9. January 31 — Full payment deadline. Payments postmarked by January 31 are considered timely.
10. February 1 onward — Penalty and interest begin accruing on unpaid balances.
11. July 1 onward — Delinquent accounts may be referred to collection attorneys; 20 percent attorney fee attaches.
12. Tax lien foreclosure — Persistent nonpayment can result in a tax lien suit and eventual forced sale under Texas Tax Code Chapter 33.

Reference table or matrix

Travis County Taxing Entities and Rate Components (Illustrative Structure)

Actual rates vary by year and by location within Travis County. Not all entities levy in all portions of the county. Properties within city ETJs or unincorporated areas may have different entity combinations.

Key Exemption Types Available in Travis County

The $100,000 school district homestead exemption reflects the increase enacted by the Texas Legislature in 2023 under House Bill 3273 (Texas Comptroller, Homestead Exemptions).

References

• Texas Tax Code — Texas Legislature Online
• Travis Central Appraisal District (TCAD)
• Texas Comptroller of Public Accounts — Property Tax
• Texas Comptroller — Property Tax Basics
• Texas Comptroller — Homestead Exemptions
• Texas Comptroller — Chapter 313 Value Limitation Program
• Travis County Tax Assessor-Collector
• Texas Tax Code §26.04 — Submission of Roll to Taxing Units
• Texas Tax Code §33.01 — Penalties and Interest
• Texas Tax Code §41.44 — Protest Filing Deadline
• [Texas Tax Code §23.23 — Limitation on Appraised Value of Residence Homestead](https://statutes.capitol.texas.gov/