Subtitle A. General Provisions
Chapter 1. General Provisions
Sec. 1.01. Short Title.
Sec. 1.02. Applicability of Title.
Sec. 1.03. Construction of Title.
Sec. 1.04. Definitions.
Sec. 1.05. City Fiscal Year.
Sec. 1.06. Effect of Weekend or Holiday.
Sec. 1.07. Delivery of Notice.
Sec. 1.08. Timeliness of Action by Mail.
Sec. 1.085. Communication in Electronic Format.
Sec. 1.09. Availability of Forms.
Sec. 1.10. Rolls in Electronic Data-Processing Records.
Sec. 1.11. Communications to Fiduciary.
Sec. 1.111. Representation of Property Owner.
Sec. 1.12. Median Level of Appraisal.
Sec. 1.13. Masters for Tax Suits.
Sec. 1.15. Appraisers for Taxing Units Prohibited.
This title may be cited as the Property Tax Code.
This title applies to a taxing unit that is created by or pursuant to any general, special, or local law enacted before or after the enactment of this title unless a law enacted after enactment of this title by or pursuant to which the taxing unit is created expressly provides that this title does not apply. This title supersedes any provision of a municipal charter or ordinance relating to property taxation. Nothing in this title invalidates or restricts the right of voters to utilize municipal-level initiative and referendum to set a tax rate, level of spending, or limitation on tax increase for that municipality.
Amended by 1981 Tex. Laws (1st C.S.), p. 117, ch. 13, Sec. 1.
Property Tax Code is superior to any municipal charter or ordinance, see art. XI, Sec. 5, Texas Constitution.
The Code Construction Act (Chapter 311, Government Code) applies to the construction of each provision of this title except as otherwise expressly provided by this title.
Amended by 1985 Tex. Laws, p. 3323, ch. 479, Sec. 72.
Code Construction Act, see ch. 311, Government Code.
In this title:
(1) "Property" means any matter or thing capable of private ownership.
(2) "Real property" means:
(B) an improvement;
(C) a mine or quarry;
(D) a mineral in place;
(E) standing timber; or
(F) an estate or interest, other than a mortgage or deed of trust creating a lien on property or an interest securing payment or performance of an obligation, in a property enumerated in Paragraphs (A) through (E) of this subdivision.
(3) "Improvement" means:
(A) a building, structure, fixture, or fence erected on or affixed to land; or
(B) a transportable structure that is designed to be occupied for residential or business purposes, whether or not it is affixed to land, if the owner of the structure owns the land on which it is located, unless the structure is unoccupied and held for sale or normally is located at a particular place only temporarily.
(C) for purposes of an entity created under Section 52, Article III, or Section 59, Article XVI, Texas Constitution, the:
(i) subdivision of land by plat;
(ii) installation of water, sewer, or drainage lines; or
(iii) paving of undeveloped land.
(4) "Personal property" means property that is not real property.
(5) "Tangible personal property" means personal property that can be seen, weighed, measured, felt, or otherwise perceived by the senses, but does not include a document or other perceptible object that constitutes evidence of a valuable interest, claim, or right and has negligible or no intrinsic value.
(6) "Intangible personal property" means a claim, interest (other than an interest in tangible property), right, or other thing that has value but cannot be seen, felt, weighed, measured, or otherwise perceived by the senses, although its existence may be evidenced by a document. It includes a stock, bond, note or account receivable, franchise, license or permit, demand or time deposit, certificate of deposit, share account, share certificate account, share deposit account, insurance policy, annuity, pension, cause of action, contract, and goodwill.
(7) "Market value" means the price at which a property would transfer for cash or its equivalent under prevailing market conditions if:
(A) exposed for sale in the open market with a reasonable time for the seller to find a purchaser;
(B) both the seller and the purchaser know of all the uses and purposes to which the property is adapted and for which it is capable of being used and of the enforceable restrictions on its use; and
(C) both the seller and purchaser seek to maximize their gains and neither is in a position to take advantage of the exigencies of the other.
(8) "Appraised value" means the value determined as provided by Chapter 23 of this code.
(9) "Assessed value" means, for the purposes of assessment of property for taxation, the amount determined by multiplying the appraised value by the applicable assessment ratio, but, for the purposes of determining the debt limitation imposed by Article III, Section 52, of the Texas Constitution, shall mean the market value of the property recorded by the chief appraiser.
(10) "Taxable value" means the amount determined by deducting from assessed value the amount of any applicable partial exemption.
(11) "Partial exemption" means an exemption of part of the value of taxable property.
(12) "Taxing unit" means a county, an incorporated city or town (including a home-rule city), a school district, a special district or authority (including a junior college district, a hospital district, a district created by or pursuant to the Water Code, a mosquito control district, a fire prevention district, or a noxious weed control district), or any other political unit of this state, whether created by or pursuant to the constitution or a local, special, or general law, that is authorized to impose and is imposing ad valorem taxes on property even if the governing body of another political unit determines the tax rate for the unit or otherwise governs its affairs.
(13) "Tax year" means the calendar year.
(14) "Assessor" means the officer or employee responsible for assessing property taxes as provided by Chapter 26 of this code for a taxing unit by whatever title he is designated.
(15) "Collector" means the officer or employee responsible for collecting property taxes for a taxing unit by whatever title he is designated.
(16) "Possessory interest" means an interest that exists as a result of possession or exclusive use or a right to possession or exclusive use of a property and that is unaccompanied by ownership of a fee simple or life estate in the property. However, "possessory interest" does not include an interest, whether of limited or indeterminate duration, that involves a right to exhaust a portion of a real property.
(17) "Conservation and reclamation district" means a district created under Article III, Section 52, or Article XVI, Section 59, of the Texas Constitution, or under a statute enacted under Article III, Section 52, or Article XVI, Section 59, of the Texas Constitution.
(18) "Clerical error" means an error:
(A) that is or results from a mistake or failure in writing, copying, transcribing, entering or retrieving computer data, computing, or calculating: or
(B) that prevents an appraisal roll or a tax roll from accurately reflecting a finding or determination made by the chief appraiser, the appraisal review board, or the assessor; however, "clerical error" does not include an error that is or results from a mistake in judgment or reasoning in the making of the finding or determination.
(19) "Comptroller" means the Comptroller of Public Accounts of the State of Texas.
Amended by 1981 Tex. Laws (1st C.S.), p. 118, ch. 13, Sec. 2; amended by 1987 Tex. Laws, ch. 984, Sec. 25; amended by 1989 Tex. Laws, p. 4628, ch. 1123, Sec. 1; amended by 1991 Tex. Laws, p. 411, ch. 20, Sec. 13; p. 1505, ch. 393, Sec. 1; and p. 2907, ch. 843, Sec. 6; amended by 1993 Tex. Laws, p.1524, ch. 347, Sec. 4.04; amended by 1997 Tex. Laws, p. 4085, ch. 1070, Sec. 52.
Correction of clerical error, see Sec. 25.25.
Participation of taxing unit in an appraisal district, see Sec. 6.02(b) & (c).
Jurisdiction to tax real and tangible personal property, see Sec. 11.01.
Jurisdiction to tax intangible personal property, see Sec. 11.02.
Manufactured home tax lien, see Sec. 32.014.
New property value, see Sec. 26.012(17).
Situs of property, see Secs. 21.01, 21.02, 21.021 & 21.21 - 21.25.
Requirement to appraise property at its market value, see Sec. 23.01.
Limestone is not a mineral as the term is used in the Tax Code, but some land containing limestone rock may be considered as part of a quarry. Gifford-Hill & Company, Inc. v. Wise County Appraisal District and Wise County Appraisal Review Board, 827 S.W.2d 811 (Tex. 1991).
The sale of dome storage caverns are not subject to an appraisal separate from the surface land. Underground salt dome storage caverns do not constitute an estate or interest in land subject to taxation. Further, the caverns were not improvements subject to separate appraisal and taxation. The separate appraisal of mineral estates does not extend to other sub-surface properties. Despite the fact that these properties were adjudged not to be taxable, the Court held that because the trial court determined the taxpayer did not prevail, the issue of attorney's fees was not subject to appellate review. Coastal Liquids Partners, L.P. v. Matagorda County Appraisal District, 118 S.W.3d 464 (Tex. App.-Corpus Christi 2003, pet. filed).
Square footage errors are correctable as clerical errors, and the appraisal review board under Section 25.25(c)(1) may review to determine whether a clerical error was made. Handy Hardware Wholesale, Inc. v. Harris County Appraisal District, 985 S.W.2d 618 (Tex. App.-Houston [1st District] 1999).
Computer application software consisting of imperceivable binary pulses that need not be packaged in a tangible form met the definition of intangible personal property. Such computer software is intangible personal property and not taxable for property tax purposes. The Legislature in Tax Code Section 11.01 allowed for only certain classes of intangible property to be taxed and defined intangible personal property in Tax Code Section 1.04(6). Dallas Central Appraisal District v. Tech Data Corporation, 930 S.W.2d 119 (Tex. App.-Dallas 1996, writ denied).
Property Tax Code Section 1.04(18) definition of clerical error should be read that subsections (A) and (B) are independent of each other. Subsection (A) is not limited to errors by the appraisal district or taxing units, but may include errors by the taxpayer. Comdisco, Inc. v. Tarrant County Appraisal District, 927 S.W.2d 325 (Tex. App.-Fort Worth 1996, rehearing overruled).
To prove that notice of appraised value was delivered as required by the Tax Code, the appraisal district must show that: the correct amount of postage was placed on the envelope; how the notice itself was put into the mail as a first-class letter; whether the taxpayer's most recent address was used; and that the notice was not returned. A mere stipulation of valid notice was insufficient. Harris County Appraisal District v. Dincans, 882 S.W.2d 75 (Tex. App.-Houston [14th Dist.] 1994, rehearing denied, error denied).
Section 1.04(18), Tax Code, refers to two types of clerical errors that a chief appraiser, ARB or an assessor may make. Subsection (A) applies to errors of commission, while Subsection (B) applies to errors of omission. Collin County Appraisal Dist. v. Northeast Dallas Assoc., 855 S.W.2d 843 (Tex.App.-Dallas 1993, no writ).
A clerical error under Section 1.04(18) does not include a mistake made by a property owner. Id.
The court refused to interpret Sec. 23.01(b) to abolish the long line of precedent in Texas on market value, nor abolish the definition of "market value" as set forth in Art. VIII, Sec. 20, Tex. Const., and Sec. 1.04(7), Tax Code. Consequently, the testimony of buyer and seller regarding sales price and terms fulfilled the Sec. 23.01 requirement of proof of market value despite the lack of evidence as to the use of generally accepted appraisal techniques in determining market value. Bailey County Appraisal District v. Smallwood, 848 S.W.2d 822 (Tex. App.-Amarillo 1993, no writ).
Limestone reserves are separately taxable from the land in which it is embedded. A lessee entitled to waste real property is liable for property taxes on the leasehold interest. Gifford-Hill & Company, Inc. v. Wise County Appraisal District and Wise County Appraisal Review Board, 791 S.W.2d 576 (Tex.App.-Ft. Worth 1990), rev'd 827 S.W.2d 811 (Tex. 1991).
Where contract provided for removal of buried pipeline, pipeline remained personal property. Lingleville Independent School District v. Valero Transportation Company, 763 S.W.2d 616 (Tex. App.-Eastland 1989, writ denied).
Under Tax Code Section 1.04(3), subsection (A), a travel trailer that has been permanently affixed to land is an improvement and is taxable as real property. Under subsection (B), a travel trailer is also an improvement and taxable as real property if the owner of the trailer owns the land on which it is located. It is not relevant under subsection (B) whether or not the travel trailer has been affixed to land. Subsection (B) is intended to expand rather than restrict the universe of structures taxable as improvements. Whether a travel trailer may be taxed as personal property will depend not only on whether the governmental body has complied with the procedural requirements of Section 11.14, but also whether the constitution permits its exemption from taxation. Op. Tex. Att'y Gen. No. JC-282 (2000). (Amendment by HB 1869, 77th Tex. Leg, 2001, eff. January 1, 2002, changed Tax Code Section 32.014 tax lien for manufactured housing.)
Travel trailers that have been affixed to rented land are personal property, but are not exempt as personal property not used to produce income. Imposing property taxes on these travel trailers that have paid sales taxes and motor vehicle registration does not constitute double taxation. Determining if a particular piece of personal property has become an improvement depends on the intent of the owner as evidenced by the mode and sufficiency of annexation. The appraisal district must determine if the attachment is permanent, subject to the property owner's right to protest to the appraisal review board. Long-term placement of travel trailers on lots of land owned by another person results in separate taxable interests, but not two separate interests in real property. A trailer attached to a leased lot, while an improvement to real property, generally will remain the property of the person leasing the lot from the trailer park. Such a trailer is taxable to the lessee of the lot, but as personal property rather than real property. Op. Tex. Att'y Gen. No. JC-150 (1999). (Amendment by HB 1869, 77th Tex. Leg, 2001, eff. January 1, 2002, changed Tax Code Section 32.014 tax lien for manufactured housing.)
Mineral production equipment must be appraised separately from the mineral leasehold interest. Land, improvements to land, and interests in land must be appraised separately, even though they are all included within the code's definition of "real property." The appraisals may be in one taxpayer account, but the account must reflect separate appraisals for each property. No authority supports a view that mineral production equipment to be indispensable to the production of oil and gas on the leasehold estate, and therefore taxable as an improvement, fixture, or appurtenance to the realty. Three factors determine whether a property is affixed as an improvement and considered real property: (1) the intention of the person making the annexation (the preeminent factor), (2) the mode and sufficiency of the annexation to the real estate, and (3) the adoption of the property to the real estate's uses or purposes. Determining if mineral production equipment is real or personal property for tax collection purposes must be made on a case-by-case basis. Op. Tex. Att'y Gen. No. DM-438 (1997).
The governing body of a home-rule city may establish by ordinance a fiscal year different from that fixed in its charter if a different fiscal year is desirable to adapt budgeting and other fiscal activities to the tax cycle required by this title.
If the last day for the performance of an act is a Saturday, Sunday, or legal state or national holiday, the act is timely if performed on the next regular business day.
Timeliness of action by mail, see Sec. 1.08.
Delinquency date generally, see Sec. 31.02.
Postponement of delinquency date, see Sec. 31.04.
(a) An official or agency required by this title to deliver a notice to a property owner may deliver the notice by regular first-class mail, with postage prepaid, unless this section or another provision of this title requires a different method of delivery or the parties agree that the notice must be delivered as provided by Section 1.085.
(b) The official or agency shall address the notice to the property owner, the person designated under Section 1.111(f) to receive the notice for the property owner, if that section applies, or, if appropriate, the property owner's agent at his address according to the most recent record in the possession of the official or agency. However, if a property owner files a written request that notices be sent to a particular address, the official or agency shall send the notice to the address stated in the request.
(c) A notice permitted to be delivered by first-class mail by this section is presumed delivered when it is deposited in the mail. This presumption is rebuttable when evidence of failure to receive notice is provided.
(d) A notice required by Section 11.45(d), 23.44(d), 23.57(d), 23.79(d), or 23.85(d) must be sent by certified mail.
Amended by 1983 Tex. Laws, p. 4947, ch. 885, Sec. 1; amended by 1989 Tex. Laws, p. 3591, ch. 796, Sec. 1; amended by 1997 Tex. Laws, p. 3897, ch. 1039, Sec. 1; amended by 1999 Tex. Laws, p. 2820, ch. 441, Sec. 1.
Electronic communication, see Sec. 1.085.
Notice of new application for exemption, see Sec. 11.43(c).
Notice cancelling exemption, see Sec. 11.43(h).
Notice of annual exemption application, see Sec. 11.44(a).
Notice of modification or denial of exemption, see Sec. 11.45(d).
Notice of decision on report of decreased value, see Sec. 22.03(c).
Notice of annual application for agricultural land, see Sec. 23.43(e).
Notice of denial of agricultural land, see Sec. 23.44(d).
Notice of new application for open-space land, see Sec. 23.54(e).
Notice of denial of open-space land, see Sec. 23.57(d).
Notice of penalty for failure of property owner to notify chief appraiser that open-space land no longer qualifies for special appraisal, see Sec. 23.54(i).
Notice to file a new application for timber land, see Sec. 23.75(e).
Notice of penalty for failure of property owner to notify chief appraiser that timber land no longer qualifies for special appraisal, see Sec. 23.75(i).
Notice of denial of timber land appraisal, see Sec. 23.79(d).
Notice of penalty for late application for timber land, see Sec. 23.751(c).
Notice of new application for recreation, park, and scenic land, see Sec. 23.84(c).
Notice of denial of recreation, park, and scenic land appraisal, see Sec. 23.85(d).
Notice of penalty for violating deed restriction of recreational, park, and scenic land, see Sec. 23.87(b).
Notice of new application for public access airport property, see Sec. 23.94(c).
Notice of denial of application for public access airport property appraisal, see Sec. 23.95(d).
Notice of penalty for violating deed restriction for public access airport property, see Sec. 23.97(b).
Notice of transportation business intangible value appraisal, see Sec. 24.09.
Notice of the qualification or cancellation of separate taxation of improvements, see Sec. 25.08(d).
Notice of qualification of standing timber for separate taxation, see Sec. 25.10(d).
Notice of qualification or cancellation of separate taxation for undivided interests, see Sec. 25.11(c).
Notice of appraised value, see Sec. 25.19.
Notice to property owner of a change in appraisal records, see Sec. 41.11(a).
Protest of failure to give notice, see Sec. 41.411.
Notice of protest hearing, see Sec. 41.46.
Notice of additional penalty for delinquent taxes, see Sec. 33.07(d).
The failure of the taxing unit to give the required five-year notice of delinquent taxes (now repealed) resulted in the cancellation of penalties and interest on taxes when the taxpayer was able to prove that the notice was not delivered. The introduction of tax records establishes a prima facie case to establish every material fact, and a rebuttable presumption arises that all required notices likewise have been delivered. The presumption disappears, however, if the taxpayer produces competent evidence to justify a finding against the presumed fact. Tax notices must be addressed according to the most recent records in the possession of the taxing unit; if no address exists for a taxpayer, statutory notice requirements do not apply. In this case, evidence was sufficient to support the trial court's finding that the school district did not deliver notice, thereby canceling penalties and interest for certain tax years. However, the owner did not overcome the presumption of delivery regarding other taxing units for certain years and therefore cancellation of the penalties and interest was not mandated. The case was remanded for trial court determination of the amounts of penalties, interest, attorney fees, court costs and other fees to be assessed. Aldine Independent School District, et.al. v. Ogg, 122 S.W.3d 257 (Tex. App.-Houston [1st Dist.], 2003, no pet. h.).
Taxing units were required to provide evidence of mailing the five-year delinquent tax notice (now repealed) before the presumption of delivery to an individual taxpayer arises. Taxing units must also claim avoidance through waiver as an affirmative defense to a taxpayer's plea in intervention. By failing to do so, the issue was waived by the taxing units. Further, taxing units must raise a taxpayer's corporate capacity to sue defense by verified pleadings or waive the issue. WHM Properties, Inc. v. Dallas County, 119 S.W.3d 325 (Tex. App.-Waco, 2003, pet. filed).
The 45-day limitation period for appeal of an appraisal review board decision only begins to run when proper notice is delivered to the appropriate party. Section 1.07(b) requires the tax official or agency to address the notice to the property owner, the person designated under Section 1.111(f) to receive the notice for the property owner (if that section applies) or, if appropriate, the property owner's agent at his address according to the most recent record in the possession of the official or agency. If a property owner files a written request for notices to be sent to a particular address, the official or agency shall send the notice to the address stated in the request. The erroneous delivery of a notice and order does not serve to trigger the 45-day period for appeal. A specific statutory scheme sets forth the manner in which property tax representatives may be designated and the effect that designation has on a taxing authority's obligation to deliver notice. The Texas Administrative Code provides that when an agent is an employee of a subsidiary of the owner, the owner is not required to provide documents supporting that agent's authority. The agent designation form itself states only that the person naming a tax agent should attach documentation - a suggestion that is not mandatory. Harris County Appraisal District and Harris County Appraisal Review Board v. Drever Partners, Inc., 938 S.W.2d 196 (Tex. App.-Houston [14th District] 1997).
To prove that notice of appraised value was delivered as required by the Tax Code, the appraisal district must show: the correct amount of postage was placed on the envelope; how the notice itself was put into the mail as a first-class letter; whether the taxpayer's most recent address was used; and that the notice was not returned. A mere stipulation of valid notice was insufficient. Harris County Appraisal District v. Dincans, 882 S.W.2d 75 (Tex. App.-Houston [14th Dist.] 1994, rehearing denied, error denied).
Requesting a new application for open-space land appraisal provides a mechanism by which the chief appraiser can obtain needed information; the chief appraiser does not have to make individual determinations before requiring a new application. A new application mailed to the taxpayer's correct address and not returned by the postal service gives the taxpayer sufficient notice. Peil v. Waller County Appraisal District, 737 S.W.2d 33 (Tex. App.-Houston 1987, no writ).
Where taxpayer testified he did not receive an appraisal notice, presumption of delivery under Sec. 1.07 was rebutted and burden shifted to appraisal district to show notice was properly delivered (i.e. deposited in the mail, correctly addressed.) New v. Dallas Appraisal Review Board, 734 S.W.2d 712 (Tex. App.-Dallas 1987, writ denied).
Where appraisal district addressed notice to previous owner of property, fact that previous owner was still listed as owner in district's records didn't make the notice valid. Sec. 1.07 requires delivery to the current owner, at the most recent address listed in the appraisal records. Id.
A county that imposes the 15% collection penalty cannot seek attorney's fees in a delinquent tax suit. Taxpayer's testimony that he didn't receive a notice of imposition of the Sec. 33.07 penalty combined with evidence that the district had an incorrect address listed for taxpayer was enough to support trial court's finding that notice was not delivered. Uvalde CAD v. Parker, 733 S.W.2d 609 (Tex. App.-San Antonio 1987, writ ref'd n.r.e.).
If an employee of the property owner, but not the appointed fiduciary, receives the appraisal review board order and signs for the receipt of the notice as the property owner's agent, the notice is presumed delivered. Personal, in-hand delivery to the appointed fiduciary is not necessary. MCI Telecommunications Corp. v. Tarrant Appraisal District, 723 S.W.2d 350 (Tex. App.-Fort Worth 1987, no writ).
Compliance with predecessor to this section required county to mail a notice; county was not required to show taxpayer received the notice. Fisher v. Kerr County, 739 S.W.2d 434 (Tex. App.-San Antonio 1987).
Where the appraisal district denies a taxpayer's assertion that a notice of appraised value was never delivered if required by the code, a material issue of fact exists that prevents the trial court from granting summary judgment for the taxpayer. Uvalde County Appraisal District v. F.T. Kincaid, 720 S.W.2d 678 (Tex. App.-San Antonio 1986, writ ref'd n.r.e.).
Where property owner or his agent received notice of appraised value at property owner's listed address and appraisal district complied with required procedures, notice is presumed delivered when it is placed in the mail and the validity of the appraisal and the existence of a tax lien remain unaffected. Dallas County Appraisal District v. Lal, 701 S.W.2d 44 (Tex. App.-Dallas 1985, writ ref'd n.r.e.).