Texas AGs “No” Opinion on Temporary Disaster Exemption for Texas Property Taxes

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Foley & Lardner LLPOn April 13, 2020, Texas Attorney General Paxton issued an opinion letter on a request of Sen. Paul Bettencourt, R-Houston, regarding a recently enacted statute providing a temporary tax exemption for qualified property damaged by a disaster. The statutory change was directed at property damaged as a result of Hurricane Harvey in 2017.  

Paxton’s Opinion No. KP-0299 expresses that the Texas Tax Code’s temporary disaster exemption does not extend to property impacted purely by economic losses caused by COVID-19. The Opinion cites a key phrase in the statute — “damaged by the disaster”.  The statute’s damage assessment categories cite levels of physical damage requiring repairs to return the property to its pre-disaster status.

The opinion closes, “Thus, purely economic, non-physical damage to property caused by the COVID-19 disaster is not eligible for the temporary tax exemption provided by Section 11.35 of the Tax Code.” 

A link to Opinion No. KP-0299 can be found here.

Note:  Texas Attorney General Opinion Letters do not have the force or effect of law. However, General Paxton’s opinion will likely guide how appraisal districts will treat an exemption application filed under Tax Code, Section 11.35 as a result of COVID-19. 

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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