Tax Deferral

Tax deferral allows eligible homeowners—typically seniors 65+ and disabled individuals—to postpone paying property taxes on their primary residence. The taxes aren't forgiven; they're delayed until the home is sold or ownership changes.

While deferred, taxes accrue interest (typically 5% annually in Texas). A lien is placed on the property to secure the deferred amount. When the home is eventually sold or transferred, all deferred taxes plus interest must be paid.

Deferral is a lifeline for homeowners who want to age in place but struggle with rising property taxes on a fixed income.

Tax deferral trades future equity for present-day cash flow. It's a valuable option for homeowners who:

• Have significant home equity but limited income

• Want to stay in their home without tax payment stress

• Understand the long-term interest accumulation

Before choosing deferral, consider alternatives:

• Claim all exemptions — Over-65 and disability exemptions reduce your bill

• Tax ceiling — Freezes school taxes for 65+ homeowners

• Appeal your assessment — Lower the underlying bill

Deferral should be a last resort after maximizing other savings.

→ Explore your options

A 75-year-old widow on Social Security struggles with her $8,000 annual property tax bill. She applies for tax deferral:

Year 1: Defers $8,000

Year 2: Defers $8,200 (taxes increased slightly)

Year 3: Defers $8,400

Total deferred after 3 years: $24,600 + approximately $2,500 interest = $27,100

She remains in her home without paying current taxes. When she eventually sells or passes, the $27,100+ is paid from the property sale proceeds before any remaining equity goes to her or her heirs.