With the Wednesday, Feb. 1 deadline for paying 2011 property taxes without penalty or interest rapidly approaching, some homeowners may be able to postpone or “defer” tax payments.
Texas law permits a homeowner who is 65 or older, or a disabled person, to defer payment of current and delinquent property taxes on that person’s residence homestead until he or she no longer owns or occupies the home as a residence.
For purposes of this law, a person is considered disabled if he or she is under a disability for purposes of payment of disability insurance benefits under Social Security.
In some cases the deferral will also extend to the surviving spouse of a person who claims a deferral, if the spouse is 55 or older and the property is the residence homestead of both spouses at the time the spouse who qualified for the deferral dies.
“Property taxes continue to accrue during the deferral period, and all unpaid taxes are assessed interest at the rate of 8 percent per year,” Harris County Appraisal District Chief Appraiser Jim Robinson said. “However, once an over-65 or disability deferral has been granted, additional charges can’t be levied for delinquent tax penalty and interest, and the property cannot be foreclosed upon for unpaid taxes during the deferral period.”
“The downside of a deferral is that rather than eliminating property taxes, it merely postpones when the taxes must be paid. This may be of concern to individuals who plan to leave their home to heirs or later sell it,” the chief appraiser added.
“Also, those who have a mortgage on their home should check with their mortgage company to make certain the deferral doesn’t violate the terms of the deed of trust securing the mortgage on the property,” Robinson said, noting that most deeds of trust require that taxes be paid currently.
In addition to an over-65 deferral, a limited form of deferral may be available to a smaller group of homeowners, whose appraised value increased by more than 5 percent from 2010 to 2011, excluding any improvements made to the home.
Under this provision, taxes must be paid before delinquency on any increase in value up to 5 percent. Taxes on the remaining amount of increase may then be deferred on terms similar to those for the over-65 or disability deferrals.
Robinson suggested that before attempting to use this provision, homeowners should first contact the taxing units (county, school district, MUD, etc.) in which their property is located to determine how much tax can be legally deferred. He also recommended that caution be used if the home has a mortgage since the deed of trust may permit the mortgage company to foreclose if all taxes aren’t paid on time.
Homeowners who qualify for a deferral may claim it at any time by filing a deferral affidavit form with the appraisal district. If a delinquent tax suit is already pending, a copy of the affidavit must be filed with the court.
For additional information, contact the Harris County Appraisal District’s information center at 713-957-7800 or visit the district’s offices at 13013 Northwest Freeway, Houston, Texas.