Decoding Your Texas Supplemental Property Tax Bill

If you're a homeowner in Montgomery County, Texas, particularly in communities like The Woodlands, you may have recently received a confusing and unexpected piece of mail: a "2024 Supplemental Tax Statement." 

This surprise bill, demanding hundreds or even thousands of dollars for a tax year you thought was settled, has left many residents asking the same questions: Is this a scam? How can they charge me more for last year's property taxes? And what can I do about it?

At Ownwell, we specialize in helping property owners navigate the complexities of property taxes. We've seen this situation before, and we're here to break it down for you. In this article, we’ll

• Explain what supplemental tax bills are

• Clarify why you received a supplemental tax bill

• Outline the critical steps to protect your rights and wallet

First Things First: Is This Bill Legit?

Let's address the most urgent question right away: Yes, the previous supplemental tax statement from your county tax office is a legitimate bill. It’s not a scam.

While it feels unfair to be billed retroactively, Texas law allows appraisal districts to correct the tax roll after it has been certified. If a correction increases your property's value, the tax office is required to send a supplemental bill to collect the difference.

A supplemental tax bill is the county's 'truing up' the books, correcting errors or omissions from previous years. While county communication can be confusing, the bill is legally valid. The key is understanding why it was triggered and ensuring the new value is fair. — Kimberly Sanchez, Property Tax Consulting Manager, Ownwell

Why Did I Get This Bill? The New Construction Puzzle

For the vast majority of Montgomery County residents receiving these notices, the reason is simple: you own a recently built home.

There's a typical lag in the appraisal system when it comes to new construction. Here’s how it typically unfolds:

1. Initial Assessment on Land: When you first bought your new home, the appraisal district's records may have only reflected the value of the vacant land. Your initial property tax bill was deceptively low because you were only paying taxes on the lot, not the house itself.

2. The Catch-Up Assessment: Eventually, the Montgomery County Appraisal District (MCAD) updates its records to include the value of your completed property (the "improvement").

3. The Supplemental Bill: This correction adds significant value to your property for the previous tax year. The supplemental bill is the invoice for the taxes owed on that newly added value of the prior year.

One Woodlands resident described their situation perfectly: 

In my case we bought a new build last year, so it was originally assesed for 50k or whatever and not it looks like the supplemental is for a more accurate assessment with a house on it.

While new construction is the primary driver, other events can also trigger a supplemental bill, such as:

• Discovering significant home improvements that weren't on the tax roll (like a new pool or garage addition).

• Correcting a clerical error in your property's features, like square footage or number of rooms.

• A change in your homestead exemption status.

Critical Alert: How to Pay Your Supplemental Tax Bill

This is the most critical section of this article. A misunderstanding here could be costly.

Supplemental tax bills are NOT paid from your mortgage escrow account.

Your mortgage lender will not receive a copy of this bill, and they will not pay it on your behalf. 

You, the homeowner or property owner, are solely responsible for paying this bill directly to your county tax office by the delinquency date.

Ignoring a supplemental tax bill is one of the most expensive mistakes a homeowner can make," warns Sanchez. 

"People are so used to their escrow handling property taxes that they set the notice aside. A combined 7% penalty and interest (6% penalty, 1% interest) will be applied the day after the due date, with additional charges accruing monthly. This payment is your responsibility.

You Have the Right to Fight Back: Protesting the New Value

Receiving a legitimate bill doesn't mean you have to accept an unfair value. You have the right to protest the new assessment. Since this value change happened outside the regular timeline, you likely never received a standard "Notice of Appraised Value," meaning you missed the regular protest deadline.

Fortunately, the Texas Property Tax Code provides remedies for homeowners who weren't properly notified. Here are your primary avenues for a late protest:

1. File a Section 25.25(d) Motion for Failure to Provide Notice

This is the most common and direct remedy for this situation. The law requires the appraisal district to send you a written notice of any change in your property's value. If they failed to do so, you can file a motion to correct the appraisal roll. This motion re-opens your right to protest the new value, but the deadline to file it is before the taxes on the supplemental bill become delinquent.

2. File a Late Protest for Substantial Over-Appraisal

If you own a homesteaded property, Texas law provides an additional safety net. If you can prove that the property's appraised value is more than 25% (one-fourth) higher than its actual market value, you can file a late protest to correct the value. Note that this has a higher burden of proof than a standard protest.

To win your protest, you need evidence. A successful appeal is built on data, not emotion. You'll need to gather things like:

• Comparable Sales: Recent sales data for homes in your neighborhood that are similar in size, age, and condition.

• Photos of Defects: Document any issues that negatively impact your home's value, such as a cracked foundation or outdated features.

• An Independent Appraisal: A report from a certified appraiser can be very persuasive.

Your Four-Step Action Plan From Ownwell

Feeling overwhelmed? Don't be. Follow these simple steps to take control of the situation.

1. Verify the Bill: Before taking any action, confirm that the bill is genuine. You can search for your property record on your local tax office’s website. For Montgomery County residents, visit mctotx.org or call them directly at (936) 539-7897.

2. Plan Your Payment: Note the delinquency date. To avoid massive penalties, you must pay the bill on time, even if you plan to protest the value.

3. Evaluate the Value: Look at the "new" appraised value that triggered the bill. Is it fair for what your home was worth on January 1, 2024? If it seems too high, you should protest.

4. Start Your Protest: This is where Ownwell comes in. Navigating late protests and building an evidence-based case can be complicated. Our team of experts handles the entire process for you — from protesting a renoticed appraisal to presenting your case to the appraisal district — ensuring you pay only your fair share.

Don't let a surprise tax bill cause you unnecessary stress or financial hardship. Get a free estimate today (no email required) and let our experts fight for you.