Why Are Property Taxes So High in Texas? What You'll Actually Pay in North Dallas

"Everyone keeps warning us about Texas property taxes. How bad is it, really?"

Short answer: Texas has no state income tax and no state property tax, so cities, counties and school districts fund themselves largely through local property tax.

In Frisco, the combined 2026 rate is approx. 1.68% of taxable value at a Frisco ISD (independent school district) address and approx. 1.87% in Prosper ISD (City of Frisco, fiscal year 2027 rates).

On a $500,000 home, that could mean roughly $580–$640 a month in property tax once your homestead exemption is in place.

Why are property taxes so high in Texas?

Because of the trade. Texas does not levy a personal income tax, and the state collects no property tax at all (Texas Comptroller).

Local taxing units set their own rates and collect the money. School districts are the biggest piece: in 2022 they levied more than 55% of all property taxes in Texas (Texas Comptroller, Fiscal Notes, December 2023).

No income tax. No state property tax. One big LOCAL bill.

Here's the part I want my relocating buyers to understand: your rate isn't set by Texas. It's set by the city, county, college district and ISD that sit on top of your specific address. Sometimes inside the same city.

How much are property taxes in Frisco, TX?

Frisco's published fiscal year 2027 rates (tax year 2026), per $100 of taxable value, Collin County side (City of Frisco):

Same city. Same county. Same price. Different PAYMENT.

Approx. math on a $500,000 taxable value, counting only the $140,000 school homestead exemption: 💰

• Frisco ISD: approx. $6,961 a year, about $580 a month
• Prosper ISD: approx. $7,662 a year, about $638 a month

That's approx. $701 a year from the school line alone. Illustrative only. Your actual bill may differ based on appraised value, exemptions and final adopted rates.

And that is NOT your full monthly cost. HOA (homeowners association) dues, a MUD (municipal utility district) or a PID (public improvement district) can add more on top.

When can I get the homestead exemption in Texas?

Texas voters approved raising the school homestead exemption from $100,000 to $140,000 of appraised value on November 4, 2025 (FOX 4; Senate Bill 4 analysis).

🚨 Here's the problem for relocating buyers: you have to own AND live in the home as of January 1 to qualify, and the general application window runs January 1 to April 30, per Collin CAD (Central Appraisal District).

Close this fall? You'd generally file next year.

The seller's tax bill may also reflect exemptions and the 10% annual homestead cap (Collin CAD) that may not carry over to you the same way. So don't build your budget on the seller's bill. Ask your lender to estimate escrow on the full value, subject to lender approval and qualification.

Quick answers

Does Texas have a state income tax?
No. Texas does not levy a personal income tax (Texas Comptroller).

How big is the school homestead exemption now?
$140,000 of appraised value, after voters approved Proposition 13 on November 4, 2025.

Can two homes in the same city have different tax rates?
Yes. In Frisco, a Prosper ISD address carries a combined rate approx. 0.19 per $100 higher than a Frisco ISD address (City of Frisco, fiscal year 2027).

My take

A higher property tax isn't automatically a worse deal. If you're leaving a state with an income tax, the trade could work in your favor. Or it may not. That depends on your income and your price point, and it's a question for a CPA (certified public accountant), not me.

Here's when waiting is the right call: if you haven't chosen a school district yet, don't choose a house yet. Pick the ISD. Run the tax math. Then shop. 🏡

You don't pay the tax rate on the brochure. You pay the one on your ADDRESS.

📲 DM me "TEXAS TAXES" on Instagram @JenniferKirkRealtor, or call 214-592-7605.

Jennifer Kirk, REALTOR® · Real Broker, LLC · Equal Housing Opportunity. I'm not a lender or financial advisor. Talk with a licensed lender about your situation.

Sources

All accessed October 21, 2026.

• Texas Comptroller of Public Accounts — Property Tax
• Texas Comptroller — Fiscal Notes, December 2023, property tax article
• City of Frisco — Property Tax Rate (fiscal year 2027)
• Texas Legislature — Senate Bill 4 (89R) bill analysis
• FOX 4 — Texas Proposition 13 election results, November 2025
• Collin CAD — What is a residential homestead exemption?
• Collin CAD — When should I file an application for a homestead exemption?
• Collin CAD — What is "Homestead Cap Loss"?