One Quarter At A Time
Some Property Taxpayers Pay in Installments
Most property owners pay their property taxes before the end of the year so they can deduct the payments from their federal income taxes. But some homeowners who are on fixed incomes have a hard time paying a lump sum amount. State law allows certain homeowners, at their option, to pay their taxes over a period of time in four equal installments.
Homeowners age 65 or older that have applied for homestead exemptions may pay current home taxes in four installments. The homeowner must pay at least one-fourth of the taxes before the February 1 delinquency date.
The homeowner must indicate on the first installment payment that the homeowner is paying the home taxes in installments. Installment payments apply to all taxing units on the tax bill.
The remaining installment payments are due before April 1, June 1, and August 1, without any penalty or interest. Thus, the last day for current installment payments would be March 31, May 31, and July 31.
For the 2002 tax payments, the date of May 31, 2003, is a Saturday. So a payment by Monday, June 2, would be timely. Tax Code Section 1.06 provides that if the last day of an act is a Saturday, Sunday, or legal holiday, the act is timely performed the next regular business day.
If an over-65 homeowner misses an installment payment, the tax collector will add to the missed installment amount a penalty of 12 percent and also interest at l percent for each month delinquent .
Tax Code Section 31.031 sets out the provisions for installment payments. It also addresses how tax collectors extend the installment deadlines if the original tax bill’s delinquency date is postponed to May 1 or a later date.
A homeowner may pay more than the amount due for each installment. The tax collector shall credit any amount paid in excess of the amount due to the next pending installment. A person may not pay less than the total amount due for each installment unless the tax assessor-collector provides for accepting partial payments. If the collector accepts a partial payment, penalty and interest charges will incur only on the unpaid amount due on the applicable date.
Homeowners who are disabled and apply for homestead exemptions also may pay their home taxes in installments. The same steps in Tax Code Section 31.031 that apply above for an over-65 homeowner apply for a disabled homeowner paying in four installments.
Homeowners whose residences are damaged in a disaster and are located in a designated disaster area also may pay their taxes in four installments, in the same months as over-65 or disabled homeowners do (as explained above).
Tax Code Section 31.032 addresses installment payments of taxes on property in a disaster area. It refers to Tax Code Section 151.350 to define "disaster area" as: “(1) an area declared a disaster area by the governor under Chapter 418, Government Code; or (2) an area declared a disaster area by the president of the United States under 42 U.S.C. Section 5141.” See the box below for those areas declared a disaster area in 2002.
Tax Code Section 31.032 also uses the definition of “disaster” in Government Code Section 418.004. That section defines “disaster” as “the occurrence or imminent threat of widespread or severe damage, injury, or loss of life or property resulting from any natural or man-made cause, including fire, flood, earthquake, wind, storm, wave action, oil spill, or other water contamination, volcanic activity, epidemic, air contamination, blight, drought, infestation, explosion, riot, hostile military or paramilitary action, other public calamity requiring emergency action, or energy emergency.”
A homeowner may pay in installments if the homeowner owns any real property that consists of fewer than five living units and the property is the owner's residence homestead or is used for residential purposes. The home must be both located in a disaster area and be damaged as a direct result of the disaster. The homeowner may pay the taxes imposed on that home by a taxing unit before the first anniversary of the disaster area declaration in four installments.
Before the delinquency date, the homeowner must pay at least one-fourth of the taxes and give written notice to the taxing unit that the homeowner will pay the remaining taxes in installments. As with the senior citizen and disabled homeowner, a homeowner with a damaged property in a disaster area must pay the installments before April 1, June 1, and August 1.
Should the homeowner fail to timely pay an installment payment, the unpaid amount is delinquent and incurs a penalty of 12 percent and interest at 1 percent for each month delinquent.
Section 31.032 also contains the same provisions as Section 31.031 about extending the installment deadlines if the original tax bill’s delinquency date is May 1 or later, about handling an amount in excess of the installment payment, and about partial payment of an installment amount.
Counties Declared “Disaster Area” During 2002
by President George W. Bush or Texas Governor Rick Perry
1 County for October 2002 Storms: Nueces County
11 Counties for September 2002 Flooding by Tropical Storm Fay: Brazoria, Frio, Galveston, Jim Wells, La Salle, Live Oak, Matagorda, Nueces, San Patricio, Webb, and Wharton.
41 Counties for July 2002 Flooding: Atascosa, Bandera, Bee, Bexar, Blanco, Brown, Burnet, Caldwell, Calhoun, Callahan, Coleman, Comal, DeWitt, Dimmit, Duval, Eastland, Frio, Gillespie, Goliad, Gonzales, Guadalupe, Hays, Jim Wells, Jones, Karnes, Kendall, Kerr, LaSalle, Live Oak, McMullen, Medina, Nueces, Real, San Patricio, San Saba, Taylor, Travis, Uvalde, Victoria, Wilson, and Zavala.
8 Counties for April 2002 Flooding: Callahan, Eastland, Haskell, Jones, Shackelford, Stephens, Taylor, and Throckmorton.