Homestead exemption

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Dear Cedar Park homeowner, 

You will soon see property tax relief in the form of a homestead exemption on your appraised home value on the City portion of your next property tax bill.  It will be a lower amount than what the Cedar Park City Council originally intended when it unanimously passed the City’s first-ever homestead exemption last April.   

 Attention Cedar Park homeowners:
  • The City of Cedar Park now has its first-ever homestead exemption.
  • You will receive a one percent or at least $5,000 homestead exemption from the appraised value of your homestead, for the City portion of your property tax statement
  • Here’s how it works:
    • For all Cedar Park homesteads with an appraised value below $500,000, an exemption of $5,000 is deducted from the value before the City’s portion of property taxes is calculated.For homes with an appraised value of $500,000 or more, the value will be discounted by one percent before the City’s portion of property taxes is calculated.
    • Keep in mind that the City of Cedar Park represents less than one fifth of your overall tax bill.

Additional details follow.

To give you some background, in an effort to lessen the impact of property taxes on homeowners due to rising property values, the City Council had adopted a one percent homestead exemption with a minimum amount of $10,000.  State law expressly provides a floor for the homestead exemption amount of $5,000 but does not specify that the floor cannot be increased.  The City also reviewed precedent set by another Texas municipality and other entities as well as Cedar Park’s home rule authority to adopt its own ordinances. 

The Williamson Central Appraisal District had accepted Cedar Park’s new homestead exemption as adopted, but the Travis Central Appraisal District reduced the floor to $5,000.  The City worked with State and County officials to seek an opinion from the Texas Attorney General.  The AG reviewed the City’s new homestead exemption and issued an opinion that the City does not have the authority to increase the homestead exemption’s floor – or minimum – above $5,000.

The good news is that Cedar Park homeowners will still receive the City’s new  homestead exemption that automatically deducts at least $5,000 from the appraised value of their home for the City portion of their taxes. 

The City Council has made some progress in adopting the City’s first homestead exemption and adopting the City’s lowest tax rate in 16 years.    The City Council will continue to explore any legislative remedies and opportunities related to homestead exemption for future tax years.  

Your home may receive additional property tax exemptions, and those are not impacted.

The new homestead exemption does not necessarily mean that your property tax bill will be lower than last year, as appraised home values have risen, but the homestead discount will be automatically reflected.

Information is also available at www.cedarparktexas.gov under the News section and on www.cedarparktexas.gov/homestead

Sincerely,

The City of Cedar Park

Background information and answers to Frequently Asked Questions (FAQs):

What is a homestead exemption? 
A homestead is a homeowner’s principal residence.  A homestead exemption removes part of the value of a homeowner’s residential property from taxation.  Tax code allows the City to give a local optional homestead exemption.  Keep in mind that the City comprises less than 20 percent of your tax bill each year and that this homestead exemption is for the City portion only of your tax bill.  

Here's how the homestead exemption works:  For all Cedar Park homesteads with an appraised value below $500,000, an exemption of $5,000 is deducted from the value before the City's portion of property taxes is calculated.  For home values greater than $500,000, the appraised value of your home will be discounted by one percent before the City's portion of property taxes is calculated.

Does Cedar Park have a homestead exemption? Why? 
Yes, as of your 2019 tax bill.  The Cedar Park City Council recognizes the burden of residential property taxes on you, the taxpayer. This is why City Council has been committed to lowering the tax rate for the past five consecutive years, resulting in the City’s lowest tax rate in 16 years.  In a continuing effort to provide our citizens property tax relief, our City Council unanimously passed a resolution on April 26, 2018 for the City’s first-ever homestead exemption.

Are any other exemptions affected by this? 
There are other local exemptions property owners may be eligible for (i.e. over 65, disability, etc.). Please consult with your appraisal district for additional information on those. Your home may receive additional property tax exemptions, and those are not impacted by this.