3.3 Billion Oversight: Why Texas Homeowners Are Leaving Big Tax Savings on the Table

Protestable property taxes enable homeowners to argue that their taxes are overvalued or underassessed. Although laws vary from state to state, the amount of money left on the table in Texas every year is reportedly staggering.

A recent Ownwell study found that by 2025, 32% of residents in all 17 Texas counties protested the property tax, while 68% did not. But what’s really impressive is that “those who skipped their 2025 protest left $1.2B in potential property tax savings on the table,” according to the study.

Over three years, the potential foregone savings totaled $3.3 billion.

A separate Ownwell study found that 74% of homeowners worry about a big increase in their annual property tax bills, especially in states where they are the highest in the country, such as Colorado, New Jersey, California, and New York. At the same time, 8 out of 10 have never complained about their property tax liability, and a whopping 53% don’t know they have the right to do so.

“Texas homeowners who avoid paying their property taxes aren’t just missing out on a small savings; all in all, they’re leaving billions on the table,” it said. Colton PaceCEO and founder of Ownwell. “In Texas, defraying your property taxes isn’t optional, it’s part of managing your housing costs.”

What happened in Texas?

Everything is big in Texas, and that can include property taxes. The reason is that the state uses a “mass assessment” system, which can lead to inaccurate and overestimated estimates.

This system favors efficiency over accuracy, some experts argue.

“Appraisers use crowdsourcing techniques, relying on statistical models and recent sales data rather than individual appraisals. Market fluctuations, restructuring, and unique factors can lead to non-adjustments,” according to Texas Tax Protest.

The lack of “boots on the ground” and the nuance of individual property situations can be dangerous for homeowners. Tax assessors use a “comparable sales” metric instead, relying on statistical models and recent sales data rather than individual assessments, according to Texas Tax Protest.

Pace explains that quantitative analysis works well for district inspectors, but often misses property-specific issues such as condition, location constraints, or recent or needed repairs.

“That’s why over-appraisals are so common; these programs are not designed to capture the various views of each home. Protesting is a way for homeowners to present those missing details,” he added.

By comparison, in states like California, Proposition 13 mandates a 1% property tax rate, “requires properties to be appraised at market value at the time of sale, and allows the assessment to increase by no more than 2% per year until the next sale,” according to the National Bureau of Economic Research.

“Texas is unique because there is no state income tax, so local governments rely heavily on property taxes, and that makes assessment accuracy even more important,” Pace said.

He added that Florida is very similar to Texas, where it has no income tax, and state and local governments and utilities rely heavily on property taxes. In Texas, even if you have a 10% housing cap, your starting point is very important. If the rate is too high today and you don’t protest, that rising number becomes the basis for future increases, so you get locked into higher taxes year after year.”

Mark Gallegosa CPA and tax partner in Porte Brown’s tax services group, explains that in Texas, the protest process often serves as the primary balance check, while in California and Florida, statutory caps provide additional built-in protections.

A cumulative effect

The Onwell study tracked the success rates of protest property taxes and county savings.

For example, in three counties in the San Antonio area, only 23% of homeowners protest the property tax, “leaving an estimated $154.5M in potential savings on the table.”

And those protesting saw a 7.1% reduction, with a 76% success rate, representing a whopping $61.8 million in total tax savings.

Meanwhile, in Bastrop County, only 15% of properties protested by 2025.

“Of those protesting, 65% received a reduction of approximately 8.9% in the assessed value.

Another benefit of a successful protest is that it doesn’t just save money this year—it lowers the “ceiling” of the property appraisal cap by 10% in future years.

As Cody Schuiteboerpresident and CEO of mortgage broker Best Interest Financial, explained, successful protests reset the individual base, so the annual increase in appraisal caps by 10% is ineffective, leading to a cumulative effect of savings during the decade.

“If a homeowner were to drop their assessed value from $400,000 to $360,000, that homeowner would save about $48,000 over ten years,” he said.

Pace echoes this sentiment: “Think of it as lowering the baseline. All future increases are based on that lower number, so the impact is compounded over time. Lowering your assessed value today can save you years, not just this tax cycle.”

Next steps for homeowners

In Texas, the protest deadline usually ends on May 15, while in Florida, for example, homeowners must file with the Value Adjustment Board within 25 days of the Truth in Millage (TRIM) notice, which notifies homeowners of their taxes in August.

It is important to note that there is a significant difference between informal proceedings and a formal Review Board (ARB) hearing.

Pace explained that most homeowners start with an informal hearing, where they present evidence directly to the County Appraisal District (CAD). If you can’t reach the agreed-upon assessed value, the next step is a formal hearing before the ARB, he said.

“The key is preparation—similar sales, photos, and proof of condition problems can make a significant difference in the outcome. The biggest mistake homeowners make is thinking that their appraisal is already accurate and correct,” he added.

Chris Gleasonfounder and CEO of Simplicite Tax Loans, which provides property tax loans to Texas property owners, said the majority of its customers are residential customers with 68% not protesting.

According to him, the lack of protests is due to several reasons: misunderstanding of the tax, fear that it may end up being charged a higher tax, and the process is time-consuming.

“We encourage our customers to protest every year. It’s a ‘no lose’ situation under the right circumstances,” he said.

Gallegos agrees, saying that in any system built on capital accounting, taxpayer participation is part of the process.

“If you don’t get involved, you’re effectively accepting a standard measure that may not reflect the reality of your area,” says Gallegos.