Rental properties do not qualify for homestead exemption, so the full tax rate applies. Texas property taxes are among the highest nationally at 1.8-2.2% of assessed value. You can deduct property taxes on your federal tax return against rental income.
No Homestead Exemption
Rental properties cannot claim homestead exemption. Pay full rate on full value.
Rate Expectations
Budget 1.8-2.2% of property value annually for property taxes on rentals.
Cash Flow Impact
On a $250,000 property, taxes could be $4,500-$5,500/year. Factor into all calculations.
Federal Deduction
Property taxes are deductible as an operating expense on Schedule E.
Tax Protest
You can protest rental property assessments just like your primary residence.