TX HB398

Reduces the annual appraisal cap for residence homesteads from 10% to 2.5% of the previous year's appraised value, limiting how much property taxes can increase year-over-year

Lowers the annual appraisal cap for non-homestead real property (such as commercial and rental properties) from 20% to 8% of the previous year's appraised value

Makes the appraisal cap for non-homestead property permanent by removing the December 31, 2026 expiration date that was set in prior legislation (S.B. 2 from 2023)

Removes references to consumer price index adjustments from the calculation of appraisal limitations for non-homestead properties

Takes effect January 1, 2026, contingent on voter approval of a related constitutional amendment proposed by the 89th Legislature authorizing these lower appraisal limits