Texas Property Tax Consultant Practice Exam

How is all real and tangible personal property categorized for taxation?

1. Taxable based on the percentage of use in the state

2. Taxable unless exempted by law

3. Taxable if occupied on January 1

4. Considered exempt unless determined taxable

The correct answer is: Taxable unless exempted by law

Real and tangible personal property is primarily categorized for taxation under the principle that it is taxable unless explicitly exempted by law. This means that, in Texas, all types of property are assumed to be subject to property tax unless there is a specific statute that provides for an exemption. This framework ensures clarity in tax administration and allows for comprehensive assessment and collection of property taxes, which are critical for funding local services, schools, and infrastructure. This categorization reflects the general approach taken by property tax systems, emphasizing the need for clear definitions of what is taxable and what is not. As a result, taxpayers need to identify any potential exemptions applicable to their property, such as those for certain agricultural uses, veterans, or charitable organizations. The acknowledgment that property is taxable unless specifically exempted streamlines the process of property assessment, providing a straightforward guideline for taxpayers and tax assessors alike.