Comprehensive Guide to the Harris County Appraisal District (HCAD)

December 24, 2020

Harris County CAD Overview

Harris County Appraisal District (HCAD) is the largest appraisal district in Texas, encompassing the Houston metropolitan area.  It’s responsible for accurately valuing $627 billion in Harris County home property valuations; by comparison, Dallas is second with $350 billion (data from Texas State Comptroller 2019 County Report of Property Values).  HCAD‘s residential property values are the starting point for the taxes levied by the various taxing jurisdictions in Harris County; however HCAD does not set your tax rate.  The values set by HCAD impact the taxable value of your property. A lower value means lower taxes for you. 

You can find out your most recent property value for Harris County by visiting the Appraisal District Site here and entering your property information.

Taxing Jurisdictions for HCAD

HCAD is responsible for the largest population and property coverage in Texas. With Harris county being the third largest in the country, encompassing the Houston Metropolitan area (covering Houston, The Woodlands, and Sugar Land), it is responsible for a wide range of taxing jurisdiction.

You can learn more, as well as find a list of current tax jurisdictions covered by Harris County CAD here.

How does HCAD accomplish its job and how do its methods affect you, the homeowner? 

Harris Appraisal Process

HCAD is required to appraise only one third of its properties each year.  Thus, your property’s appraisal may remain unchanged from year to year.  If your property is not reappraised, the district is not obligated to send you a Value Notice. Regardless of your appraisal status, Property Tax Protest highly recommends you protesting your property value every year. Protesting is the only way to determine if your property value is appropriately justified by Harris County.

The Property Tax Appeal and Hearing Processes

Tax protest is the most direct way to resolve any disputes or disagreements that you have with the valuation of your property in Harris County. Your right to protest property taxes in Texas is enshrined in the Texas Constitution.  Its roots hearken back to “No taxation without representation” which motivated the thirteen colonies to revolt against English rule. 

It is important that you protest your property value every year. If you do not protest while others do and they obtain reductions one result is that you will pay more to make up for their property tax savings.  The tax rate set by the taxing jurisdictions will need to increase to offset the aggregate reductions granted to successful protesters.

The protest process is complex. Many owners neglect to use all the relevant grounds for appeal to the Appraisal Review Board.  For homeowners these include both Value Above Market (comparable sales) and also Inequality of Assessment (comparable assessments). 

You can find more information here on the types of protests you are entitled to, as well as a detailed account of the different types of property values and terms you will encounter during the protest process.

Mass Appraisal Techniques

To evaluate at least one third of $627 billion in property values each year HCAD uses Mass Appraisal techniques which evaluate properties in large batches rather than individually. In any one year, Harris County is responsible for appraising over $200 billion in property values. Mass appraisal is only an estimate of value using systems and logical analysis of data, not separate appraisals.

But the Texas Property Tax Code requires individual characteristics that affect a property's market value also be evaluated in determining that property's market value (Section 23.01). Thus, the basis for a taxpayer’s protest is that individual characteristics of the property were not sufficiently considered when HCAD used mass appraisal techniques. That is the heart of your argument. To win a property tax reduction at the Appraisal Review Board an owner or agent must be able to demonstrate how those characteristics differentiate the property from the mass.

You know your property better than the appraisal district does. Property Tax Protest believes you should use that expertise to differentiate your property from the other properties in the county used by HCAD to support their value for your property.  

Harris Central Exemptions

Harris Central Appraisal District also adjudicates taxpayers’ requests for exemptions which reduce their tax burdens.

  • The Homestead Exemption is the most common exemption sought by property owners in Harris County; it accounted for $216 billion (36%) of the HCAD’s $627 billion total in 2019. 
  • The homestead exemption limits the amount by which the appraisal district may increase a property’s market value since the most recent appraisal.  Thus, the homestead exemption helps the homeowner avoid large tax increases in a rising market.  

Paying Your Property Tax

Paying your property taxes on time is important to prevent interest or penalties. The exemptions on file can cause slight deviation from the deadline, so it is important for the homeowner to understand the specific due dates on the property. 

  • January 31 - Payment of taxes is due by January 31 of the following year
  • Many owners pay by December 31 to obtain a deduction on their current year federal income taxes. 
  • If you have the Over 65 exemption or the Disabled exemption, then you may pay one quarter of your total tax by January 31 and one quarter each on March 31st, May 31st and July 31st without charge for interest or penalties.
  • If you have the Over 65 exemption you may also defer payment of property taxes entirely until the property changes ownership, often through probate.  However, deferred taxes accrue interest at 8% per annum.  To avoid cumulative charges against the property it is advisable to protest unreasonable current year value increases since a successful protest will reduce the amount ultimately due when the property changes ownership.
  •  Failure to pay property taxes when due will result in substantial penalties (starting February 1 at 15% of the amount due) and interest which will continue to accrue until full payment is made.  There is usually no compromise available to delinquent taxpayers.
  • Taxes due constitute a lien against your property and can, in rare instances, lead to foreclosure and loss of ownership.

Are There Negative Consequences to Protesting Every Year?

No, in fact there are positive implications that will prolong the life of any reduction you obtain.  The Texas Property Tax Code specifies that “In the next tax year in which the property is appraised (following a successful protest), the chief appraiser may not increase the appraised value of the property unless the increase by the chief appraiser is reasonably supported by clear and convincing evidence. . . . The burden of proof is on the chief appraiser to support an increase...”  Texas Property Tax Code, Section 23.01(e).‍

Hire a Professional

Property Tax Protest will take care of the entire protest process by doing the following:

  • File a protest with the Harris Central Appraisal District using all the grounds for appeal available to you.
  • Present arguments for your fair market value to the appraisal district and, as necessary, to the Harris Appraisal Review Board. 
  • Present arguments for Inequality of Appraisal as it applies to your property.  The Inequality argument is complex; many consultants don’t know how to present it effectively.
  • Make sure you pay only your fair share of property taxes, not more.
  • Continue the process automatically each year until you cancel the service so that you know you are protected against unreasonable increases in your property taxes.  It’s like an insurance policy with no advance premium. 

Options After the Appraisal Review Board Hearing

If you are not satisfied with the result of the Appraisal Review Board hearing you have further options with which Property Tax Protest can assist you.  You can:

  • Request binding arbitration (an arbitration that appeals the Appraisal Review Board’s decision).  Binding arbitration requires a deposit (up to $500 for most homeowners) which is returned to the owner if the arbitrator awards a market value closer to the owner’s request than to the Board’s. 
  • Property Tax Protest will share the risk of binding arbitration with you.  If the arbitrator’s award results in less savings than your deposit, Property Tax Protest will pay you half difference.  Clearly, Property Tax Protest will not take a binding arbitration case unless it believes you can win.
  • File a judicial appeal.  This is usually not cost effective for homeowners. 

Let Property Tax Protest Handle Your Protest.

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