The Tax Benefits of Land Ownership in Texas
Land always makes sense as a long-term investment – especially when you buy land in an area as popular as Texas Hill Country. But, of course, if you are considering an investment property, you must think about all your costs – including property taxes.
While there are costs to land ownership, there are tax benefits of owning land in this area. Let’s discuss the tax benefits of land ownership in Texas and how they can help you save money in the long run.
Texas Property Tax Rates
Texas does not not have a state property tax. Instead, local governments are authorized by the Texas Constitution and statutory law to collect this tax. The state also does not establish tax rates, collect taxes, or mediate disputes between taxpayers and their local governments.
Texas property tax rates are attractive to potential land owners. Texas is one of the eight states with no income tax, and Texas counties rate among the lowest in terms of overall tax burden – usually ranging from 0.5-2.5%. Texas also has some of the lowest real estate taxes in the nation.
For example, if you purchased a $150,000 piece of land in Blanco County in 2023, you could expect to pay around $1,800 annually in property taxes. This is based on the effective tax rate of 1.2% for Blanco County, as reported by SmartAsset.
Taxes on Vacant Land in Texas
Investing in Texas real estate is one of the best ways to protect against an unsteady market. Owning vacant land in an up-and-coming community is an excellent investment with many tax benefits. For example, it’s worth noting that taxes on raw land in Texas may be less than $25/year until improvements are made.
Wildlife Management Plan Tax Exemption
Texas is home to white-tailed deer, wild turkeys, small mammals, and colorful songbirds. This wildlife and beautiful natural features draw people to the area.
To protect Texas wildlife, the state awards a property tax exemption to landowners if they create and follow a Wildlife Management Plan focused on enhancing and preserving the local ecology. This is another way to save on the expenses associated with land ownership.
Exemptions for Disabled Veterans and Surviving Spouses
Disabled veterans or their surviving spouses may qualify for an exemption from Texas taxes on land. Texas law provides an exemption of the total appraised value of land if the veteran is 100 percent disabled due to a service-related injury. This tax break can be applied to Texas’ state taxes as well as local property taxes.
Besides Tax Benefits – Here Are Other Reasons to Buy Land in Texas
Of course, there are other benefits of purchasing land in Texas – besides the aforementioned tax benefits and natural beauty. The most obvious benefit of Texas land is its location. Central Texas residents have easy access to Austin, Fredericksburg, and popular recreation destinations like Lake LBJ and Horseshoe Bay Resort. In addition, Texas residents have easy access to award-winning hospitals and international airports.
Land for Sale in Texas at Round Mountain Reserve
Round Mountain Reserve is a premier homestead community in Blanco County, offering property for sale in the Texas Hill Country. The centerpiece of this community is Round Mountain, a 1,000-foot high hill overlooking expansive views in all directions.
Round Mountain Reserve is a conservation-focused development. Each property has a customized Wildlife Management Plan, which protects the natural elements while giving owners a exemption on property taxes. In addition to preserving the local ecology, the development was designed to protect the view corridors for each property.
Timing is everything in real estate. To enjoy the tax advantages of purchasing vacant land in Texas, you must act now. Schedule your tour of Round Mountain Reserve today.