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Homesteading your primary residence property does two important things for homeowners in Texas.

First, it offers you protection from creditors in tough times especially in cases of bankruptcy. Second, it can save you money on your annual property tax bill.

Tax savings will vary based on your taxing entities, but for example a homeowner in McKinney with a home assessed at $250,000 would typically pay the following taxes:

City of McKinney $250,000 * 0.573% = $1,432.50

Collin County $250,000 * 0.208395% = $520.99

Collin College $250,000 * 0.01222% = $30.55

McKinney ISD $250,000 * 1.62% = $4,050

For a Total tax bill of $6,034.04 based on 2016 tax rates.

When you homestead your home you are able to reduce the assessed amount of your home by the homestead exemption amount. 

Both Collin County and McKinney ISD offer homestead tax breaks.  Collin County has a 5% assessment reduction with a $5,000 minimum and McKinney ISD offers a $25,000 assessment reduction.  So the same $250,000 assessed home with a homestead exemption would pay:

 City of McKinney $250,000 * 0.573% = $1,432.50

Collin County $237,500 * 0.208395 = $494.94

Collin College $250,000 * 0.01222% = $30.55

McKinney ISD $225,000 * 1.62 = $3,645.00

For a Total tax bill of $5602.99 and a savings of 7% or $431.05 per year based on 2016 tax rates and exemptions.

Those are great savings for taking 5 minutes and filling out a form then mailing it in.  You only have to do it once to continue to save money annually.

If you aren’t sure if you have completed your homestead exemption you can check online by searching your address at www.collincad.org.  Once under your address information look for Exemptions under the Owner Information section. 

Also at Collin County Appraisal District website you can use the link on the right side “Exemptions and Rates” to see current and historical tax rates for many local entities.  Homestead is not the only exemption there are also exemptions for Over 65 and Disabled Persons.

If you have any questions about home ownership, homestead filing or other real estate questions we would love to be your local experts.  If you bought a home last year and need assistance getting it filed just let us know.  You only have until April 30th to file so don’t delay!

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