School Tax Ceiling CertificateSurviving Spouse Over-55 May Transfer Tax Limitation
Effective January 1, 2002, a new state law allows a surviving spouse age 55 or older to retain the deceased spouse's right to transfer the over-65 school tax ceiling to a subsequent residence homestead.
House Bill 506 amends Tax Code Section 11.26(g) and (h) to state that a surviving spouse age 55 or older, who has a school tax ceiling, may transfer the benefit of that ceiling to a different qualified homestead. This gives surviving spouses age 55 or older the same right currently available to homeowners age 65 or older.
School boards must apply the limitation as if this law change were in effect on August 25, 1997, the date the school tax ceiling transfer became law for over-65 homeowners. The law change, however, addresses tax year 2002 forward. There is no refund of any school taxes for tax years 1997 to 2001.
Since 1987, state law has provided that surviving spouses age 55 or older continue to receive on the qualified homestead the over-65 homestead exemptions for all taxing units, as well as the school tax ceiling, when their spouses die. The law change in 1997 did not address the surviving spouse transferring the tax ceiling to another homestead.
Transferring an homeowner’s school tax ceiling to a different home gives the same school tax benefit to the homeowner, not the same tax ceiling. A school tax ceiling on a new home would be calculated to give the homeowner the same percentage of school tax paid as the original home’s tax ceiling.
For example, a qualified homeowner had a school tax ceiling of $200 but would pay $1,000 without a tax ceiling on the homestead. The percentage paid by the homeowner was 20 percent ($200 divided by $1,000, times 100). If the homeowner moved to a new home, the owner will pay 20 percent of the school tax bill on the new home. If the new home’s school taxes were $2,000, then the owner would have a tax ceiling of $400 ($2,000 times 20 percent).
One item to note is if a homeowner had a school tax ceiling of $0 on the old home. The percentage of tax paid is 0 percent, so the owner would have a tax ceiling of $0 (school taxes times 0 percent) on the new homestead.
To transfer the school tax ceiling, the qualified homeowner may request a certificate from the chief appraiser in the last appraisal district in which the homeowner received the tax ceiling. The homeowner presents the transfer certificate to the chief appraiser in the district where the new home is located, when the owner applies for homestead exemptions on the new home.
Remember that Tax Code Section 11.13(h) states that a person may not receive an exemption for more than one residence homestead in the same year. The homeowner must choose which home to receive homestead exemptions in a given year, if the homeowner owns two homes in the same year.
The Comptroller's School Tax Ceiling Certificate for Over-65 and Surviving Spouse Over-55 changed to reflect the new law. The Comptroller’s prescribed form on page 6 was retitled and includes a place for the chief appraiser to check if the homeowner qualified as a homeowner age 65 or older or as a surviving spouse age 55 or older.
The remainder of the school tax ceiling certificate remained the same as previous years.
For more information about this certificate, contact the Comptroller’s Property Tax Division, Technical Assistance, by e-mail at email@example.com or by calling 1-800-252-9121, select option 2. In Austin, call 512/305-9999.