November 2025 Changes

Several pieces of legislation in 2025 managed to grant breaks to homeowners, including a homestead exemption of $140,000. The other key property tax bill was one that expanded the senior exemption from just $10,000 to $60,000. Both of these exemptions applied just to public school taxes, though some counties extended them to other types. Unlike many other exemptions, the homestead and the over-65 exemptions stack with each other, creating a final protection of $200,000.

This completely removes many seniors from the obligation of school taxes entirely. The burden shifts away from older homeowners, allowing them a better chance to stay in their homes, since property taxes are typically the largest bill that Texans see each year. Public school taxes have traditionally been the largest of the three property tax types, but this has changed since legislation in 2023 expanded the homestead exemption from $40,000 to $100,000.

Double Nickel Changes Under 65 to Under 55

Operation Double Nickel, as proposed, piggybacks off the changes from 2025. The largest change proposed is how seniors are classified in the eyes of the law for taxing purposes would decrease by 10 years. This means that residential property owners who are 55 or older could then apply for the senior exemption, essentially changing it to over-55. This would offer qualified homeowners between their prime working years and retirement a huge opportunity to eliminate school taxes entirely on their primary residence, just like seniors currently can. In theory, this would also grant homeowners more financial flexibility, as people 55 and over are often still working. Many also have college-aged children, which could help the next generation as well.

It is estimated that Operation Double Nickel would add over 3 million Texas homeowners to the lower tax threshold, saving hundreds of millions of dollars, possibly billions. The average taxpayer entering this age range would save around $1,000 every year. Needless to say, this would provide a helping hand to millions of people, especially those flirting with retirement.

Another Exemption Increase

Operation Double Nickel would not stop at just expanding the exemption age range; it would also strengthen the exemption even more. Under the proposal, the standard homestead exemption would grow to $180,000, benefiting homeowners of all ages. Of course, this would also stack with the $60,000 over-55 exemption, potentially granting older homeowners a total exemption of $240,000. This gives Operation Double Nickel an excellent one-two punch that should gain plenty of support in the 2026 legislative year.

Too Much or Too Little?

While great on the surface, it is not all sunshine and rainbows. There is criticism coming from several different directions that could put a damper on this proposal. With the governor leaning towards eliminating school property taxes entirely, there is a lot of public support in that direction, as it would result in massive savings for all Texans. There is also criticism going the other way, with some arguing that the cuts proposed under Operation Double Nickel would favor older generations at the expense of younger ones. As homeownership becomes a distant dream for younger Texans, there has been some pushback against property tax relief in general. There are fears that an increased sales tax will be used to help budgets, which would impact all Texans, not just homeowners.

How Will Schools Be Funded?

After two large cuts thanks to exemption increases in 2023 and 2025, many taxpayers and parents have been wondering how schools will be paid for if funding at the local level keeps being reduced. Currently, the plan is to use the budget surplus of the state of Texas to fill all shortfalls. This is already being done in the wake of the 2025 reductions. The whole thing hinges on Texas staying in the black, which raises questions about the future. The more conservative reduction of Operation Double Nickel certainly seems to be more sustainable than the draconian cuts proposed by the governor, but there is still plenty of time to see how well these plans do in upcoming elections.

Appeals Boost Exemptions

While exemptions are a fine baseline, taxpayers can land even more savings by pairing these improving exemptions with property tax appeals. A property tax appeal can lower the taxable value of a home even further, meaning a smaller burden for all types of property taxes, not just taxes levied by school districts. In order to make up for falling revenues, local governments may raise taxes in the future, making appeals instrumental in keeping things on the level. Protests also establish a fair market value for your property, which can then be lowered even further with exemptions.

O’Connor is Here to Help

We at O’Connor have been advocates of fair taxation for over 50 years. Based in Houston, we understand how property taxes work in Texas, and know how to best help our clients get the best deal on their taxes. We have long been fans of using exemptions and appeals paired together and are looking forward to using current and future legislation to help you protect your home or business. We can help you review your assessment and discover any missing exemptions you might have. We will also ensure that your assessment and tax bill are correct, and that it does not contain any errors. If we do find missing exemptions or blatant errors, we will carry out a correction of the appraisal roll to retroactively fix these issues.

With the Texas property tax landscape constantly changing, we will keep you abreast of everything that you need to lower your taxes. We will protest your appraisal annually, ensuring that you are always getting the best deal. There is no charge to sign up for our services, and you will only be charged a contingency fee if we are able to lower your taxes. This means there is no risk to you, now or in the future.