When you receive your Texas property tax bill, you probably simply pay the bill without even thinking about how the bill was determined. The reality is that determining your property tax rates is a fairly interesting process that involves input from four different groups of people: the property taxpayer, the appraisal district, the appraisal review board, and the local taxing units.
The Property Taxpayer
The property taxpayer is the person or business that owns the property being assessed. If you have received a property tax bill, you are the property taxpayer in the process. As such, you are responsible for paying the taxes on your property.
The Appraisal District
An appraisal district is found in each county within the State of Texas. Each district is administered by a chief appraiser that is responsible for setting the value of your property once per year. The board of directors that runs the appraisal district is responsible for hiring the chief appraiser, while local taxing units appoint the members of the board. Local taxing units also fund the appraisal district, with the amount of funding being determined by a special formula that is based on the taxes that are collected.
The Appraisal Review Board
The appraisal review board, or ARB for short, is responsible for settling disagreements between the property taxpayer and the appraisal district. Disagreements may arise regarding the assessed value of the property or on the taxability of the property. Citizens from the community are appointed by the board of directors to serve as members of the appraisal review board.
The Local Taxing Units
There are a number of different groups that fall in the local taxing units category. These including:
* School districts
* Counties
* Cities
* Special districts
These local taxing units are responsible for deciding upon how much money they need to spend in order to provide necessary services to the public. The property taxes paid by property taxpayers are based upon the budgets established by the local taxing units.
Depending upon the local taxing unit, the funds received from property taxes may be the only money the organization receives. Or, the money they receive from property taxes may provide the organization with the bulk of the funds it needs. Schools, for example, rely heavily on the money they receive from property taxes. Although they also receive money from state and federal funds, the majority of their money comes property taxes.
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