TX HB4407

Reduces school district maximum compressed tax rates by $0.15 per $100 valuation for the 2025-2026 school year, with a floor ensuring no district's rate falls below 90% of another district's rate

Requires tax collectors to establish escrow accounts for property owners upon request, allowing owners to make deposits toward future property tax payments (effective January 1, 2026)

Expands the 5% annual appraisal cap (currently 10% for homesteads only) to all real property, limiting yearly appraised value increases to 5% plus the value of new improvements (effective January 1, 2026, contingent on voter approval of related constitutional amendment)

Resets the appraisal limitation baseline for non-homestead real property acquired before 2025 to January 1, 2025, with the limitation expiring when at least 50% ownership interest is transferred

Repeals the existing "circuit breaker" limitation provisions from S.B. 2 (88th Legislature, 2nd Called Session) that were set to take effect January 1, 2027, replacing them with the new 5% cap structure