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How to Calculate The Assessed Value of Real Property Texas

Reviewed by Calculator Editorial Team

Calculating the assessed value of real property in Texas is essential for property tax purposes. This guide explains the process, provides a calculator, and includes a step-by-step formula.

How to Calculate Assessed Value in Texas

The assessed value of real property in Texas is determined by the appraisal district and is used to calculate property taxes. The process involves several steps:

  1. Determine the appraised value - This is the estimated market value of the property.
  2. Apply the exemption - Subtract any applicable exemptions from the appraised value.
  3. Calculate the assessed value - Multiply the remaining value by the assessment ratio.

The Texas Property Tax Code establishes the assessment ratio, which is typically 60% for residential property and 100% for commercial property.

Assessed Value Formula

Assessed Value = (Appraised Value - Exemptions) × Assessment Ratio

The formula shows how the assessed value is calculated by first subtracting any exemptions from the appraised value, then multiplying by the assessment ratio.

For residential property, the assessment ratio is typically 60%. For commercial property, it's 100%.

Worked Example

Let's calculate the assessed value for a residential property with an appraised value of $300,000, $50,000 in exemptions, and a 60% assessment ratio.

Assessed Value = ($300,000 - $50,000) × 0.60

Assessed Value = $250,000 × 0.60

Assessed Value = $150,000

The assessed value in this example is $150,000.

FAQ

What is the difference between appraised value and assessed value?
The appraised value is the estimated market value of the property, while the assessed value is the value used for property tax purposes after applying exemptions and the assessment ratio.
How often is the assessed value updated?
The assessed value is typically updated annually during the appraisal process.
Can the assessed value be appealed?
Yes, property owners can appeal the assessed value through the Texas Property Tax Appeal Board if they believe the appraisal is incorrect.