THE WINTER STORM AND THE § 11.35 TEMPORARY DISASTER EXEMPTION
Starting on February 11th and lasting through February 19th, Texas property owners were battered by an unprecedented winter storm. CBS News estimated that the winter storm’s costs could exceed $200 billion dollars, more than Hurricane Harvey or Hurricane Ike. The storm burst pipes, flooded several properties, and caused numerous other forms of property damage. The damage has left property owners scrambling to minimize the financial burden and capitalize on every form of government relief and tax exemption. Section 11.35 of the Texas Property Tax Code provides one such remedy.
Section 11.35 can provide owners with a temporary exemption from their property taxes and exists for all property types.
To qualify for the exemption, property owners must show:
(1) that the property is located in an area that has been declared a disaster area by the governor of Texas,
(2) applies for the exemption timely, and
(3) can show that the improvements of the property has been at least 15% damaged.
The first requirement was met for the entire state of Texas since Governor Gregg Abbott declared all 254 counties in Texas a disaster area on February 12, 2021 due to the winter storm. In addition, the deadline to file for the exemption is May 28, 2021 so we are currently within the deadline to apply.
Therefore, the only requirement remaining is to calculate the amount of damage that occurred to the property. The amount of the exemption is broken into four tiers that are assigned based on the amount of damage shown. These tiers are referred to as Levels 1-4 damage assessment ratings with each level requiring the following damage: Level 1—15%, Level 2—30%, Level 3—60%, or Level 4—100%. Since the amount of the exemption is tiered in that way, property owners need to be prepared to show all damage to their property in order to allow assignment of the correct damage tier. Proof of damage to a property may include pictures of the damage, receipts for the repairs, cost estimates for repairs, and possibly loss of revenues due to property damage.
Once damage is evaluated, property owners who estimate their damage at 15% or higher will have until the 105th day after the date the Governor first declared a disaster to file. Property owners can file for the exemption using Texas Comptroller’s Form 50-312. After submission of that form, the reviewing appraisal district will either approve or deny the application. If the application is denied, the property owner has 30 days to protest that action, and the Appraisal Review Board will then hold a hearing and determine whether the application should have been granted. Either side may then appeal the decision of the Appraisal Review Board by filing a lawsuit.
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