8 Tax-Saving Strategies Texas Homeowners Can't Afford to Miss in 2026

Texas just rolled out the biggest property tax cut in state history.

And combined with new federal tax changes, 2026 is shaping up to be a great year for homeowners who know where to look.

Whether you're trying to lower your property tax bill, maximize deductions, or just keep more money in your pocket, these strategies will help.

Let's break down what's new and what you need to do.

1. Claim Your Bigger Homestead Exemption (Automatic Savings)

The Big News: Texas homestead exemptions jumped significantly on January 1, 2026.

New Exemption Amounts:

• All homeowners: $140,000 (up from $100,000)
• Homeowners 65+ or disabled: $200,000 total exemption ($140,000 base + $60,000 senior/disabled)

What This Means: The owner of a typical Texas home valued at $302,000 will save about $490 per year in school property taxes.

Action Step: If you already have your homestead exemption filed, you're good — the new amounts apply automatically. If you haven't filed yet, do it now through your county appraisal district.

2. Max Out Federal Standard Deductions

The Numbers for 2026:

• Married filing jointly: $32,200 (up from $31,100 in 2025)
• Single filers: $16,100 (up from $15,550)
• Head of household: $24,150 (up from $23,300)
• Seniors 65+: Add $2,050 for single filers or $1,650 for married filers

Texas doesn't have state income tax, so you're already ahead of most of the country. But don't leave federal deductions on the table.

Action Step: Make sure you're taking the right deduction amount when you file. Most Texans benefit from the standard deduction since there's no state income tax to itemize.

3. Take the New Senior Deduction (Age 65+)

The Change: Seniors can now claim an additional $6,000 deduction ($12,000 for married couples if both qualify) on top of the standard deduction.

This is separate from the existing senior standard deduction increase. It's a brand new benefit available through 2028.

Who This Helps: Seniors with a Modified Adjusted Gross Income (MAGI) under $75,000 for singles or $150,000 for joint filers.

Action Step: If you're 65 or older, claim this when you file your 2026 taxes. Talk to your tax preparer to make sure you're not missing it.

4. Benefit From Updated Tax Brackets

The IRS adjusted federal tax brackets for inflation. That means you need higher income to hit the same tax rates.

Example: The 24% tax bracket for married couples filing jointly now starts at $206,700 (up from $201,050 in 2025).

Action Step: Review your withholding on your W-4. If you got a huge refund last year, you might be over-withholding. Adjust it so you keep more money throughout the year instead of giving Uncle Sam an interest-free loan.

5. Boost Your Retirement Contributions

New Limits for 2026:

• 401(k) contributions: $23,500 (up from $23,000)
• 401(k) catch-up (age 50+): $7,500 additional
• IRA contributions: $7,000 (up from $6,500), plus $1,000 catch-up

Why It Matters: Every dollar you put into a traditional 401(k) or IRA lowers your taxable income. More contributions = less tax owed.

Action Step: Increase your 401(k) contribution percentage if you're not maxing out. Even bumping it up by 1–2% can make a difference.

6. Leverage Estate Tax Exemption Increases

The Change: The federal estate tax exemption increased to $15 million per person ($30 million for married couples) in 2026.

Texas doesn't have a state estate tax, so you're only dealing with federal rules. If your estate is below these thresholds, you don't owe federal estate tax.

Who This Helps: High-net-worth families, business owners, and anyone with significant real estate holdings.

Action Step: If your estate is approaching these levels, talk to an estate planning attorney about trusts and gifting strategies.

7. Don't Overlook Energy-Efficient Home Credits

Federal tax credits for energy-efficient home improvements are still available in 2026.

What Qualifies:

• Solar panel installation (30% tax credit)
• Energy-efficient windows and doors
• Heat pumps and HVAC upgrades
• Insulation improvements

Texas summers are brutal. If you're upgrading your HVAC or adding solar, you might qualify for significant federal tax credits.

Action Step: Keep receipts and documentation if you're making energy-efficient home improvements. You'll need them when you file.

8. Protest Your Property Assessment (The One Most People Skip)

Here's the strategy that saves Texas homeowners the most money: protesting your property assessment.

30–60% of Texas properties are over-assessed. That means your home's value might be inflated by the appraisal district — and you're paying too much in property taxes every year.

How It Works:

Texas appraisal districts send out Notices of Appraised Value in April. You have until May 15 to protest if you think your home's value is too high.

Why It Matters: Even a 10–15% reduction in your assessed value can save you $1,000+ per year.

The Best Part: 80–90% of informal protests in Texas are successful. But only about 5% of homeowners actually protest.

Texas has a 10% homestead cap that limits how much your assessed value can increase annually. But if you're starting from an inflated value, you're still overpaying year after year.

Counties use mass appraisal systems that rely on computer models. These systems make mistakes — wrong square footage, incorrect features, or outdated comparable sales.

If your home is valued higher than similar properties in your neighborhood, you might have an unequal appraisal case. Check out the 5 signs your home is overassessed.

Action Step: When you get your Notice of Appraised Value this spring, compare it to recent sales in your neighborhood. If it seems high, file a protest. TaxDrop handles the entire protest process for Texas homeowners. We use a no win, no fee model — we only charge 25% of your first-year savings if we reduce your property taxes by at least $500. Otherwise, it's completely free.

Your 2026 Texas Tax Action Plan

1. Verify your homestead exemption — Make sure it's on file to get the new $140,000 exemption
2. Claim the senior deduction — If you're 65+, don't miss the extra $6,000 deduction
3. Adjust your withholding — Stop over-withholding and keep more money now
4. Max out retirement contributions — Lower your taxable income
5. Watch for your appraisal notice in April — Be ready to protest by May 15 if your value is too high

The biggest opportunity here? Your property taxes.

Most Texas homeowners don't realize they can protest their property assessment. And most who do realize it don't have the time to deal with the appraisal district.

That's where TaxDrop comes in. We handle the protest for you. If we don't save you at least $500, you pay nothing.

Ready to reduce your property taxes? Get a free savings estimate at TaxDrop in under 2 minutes. Start now!