If you own investment or commercial property in Elgin, the new 20 percent cap on taxable value increases could change how much you pay in property taxes. It is a timely topic, since Bastrop County began applying it in 2024. You want to know if you qualify, what changes at sale, and whether rising tax rates could offset any savings. This guide breaks it all down in plain English so you can plan with confidence. Let’s dive in.
What is Texas’s 20% cap?
The 20 percent “circuit‑breaker” cap limits how much the taxable value of many non‑homestead properties can rise each year. The appraisal district compares last year’s taxable value plus 20 percent to this year’s market value and uses the lower number to compute your taxes, subject to rules in the Texas Property Tax Code. For 2024 the cap applied to parcels with market value at or below 5,000,000 dollars; for 2025 the threshold is 5,160,000 dollars per the Texas Comptroller’s guidance. The Legislature authorized the cap only for tax years 2024 through 2026, so it is temporary unless extended.
Homestead residences are excluded and continue to use the 10 percent homestead cap and exemptions. Properties with special agricultural or timber valuations, certain public‑use properties, and personal property are also excluded, and new improvements are not capped. See this overview of exclusions from the Institute for Professionals in Taxation.
How the cap works in Elgin
Bastrop Central Appraisal District (BCAD) applies the cap automatically when a parcel qualifies. Your Notice of Appraised Value should show two numbers: market value and the capped net appraised value. Your NOAV should show both values, according to BCAD’s circuit‑breaker page.
Timing matters. To receive the cap, you must own the property on January 1 and own it for a full calendar year before the limitation takes effect. The rule is set in Chapter 23 of the Tax Code. If you sell, the limitation is removed and the taxable value generally resets to market value for the next owner. Selling resets the cap, a point highlighted in IPT’s summary.
A quick example
Last year your taxable value was 200,000 dollars. This year, market value is 300,000 dollars. With the cap, your taxable value can increase to at most 240,000 dollars, plus any new improvement value. Taxes are calculated on 240,000 dollars even though market value is 300,000 dollars. BCAD notes your NOAV should show both market and capped values on its circuit‑breaker guidance.
Who in Elgin is affected
Homestead homeowners are not affected by this cap. It is aimed at non‑homestead parcels like rentals, small to mid‑size apartment properties, commercial buildings, and investment land, provided the parcel’s value meets the annual threshold. That mirrors what analysts expected statewide, as summarized by IPT.
There is evidence it already matters locally. The Texas Comptroller’s 2024 reporting shows Bastrop County had a Loss to Non‑Homestead Cap of 14,212,579 dollars, which reflects taxable value limited by the new cap in the county’s filings that include Elgin ISD. See the Comptroller’s data listing here. BCAD also notes the cap is set to expire after the 2026 tax year unless the Legislature extends it on its local guidance page.
How it can change your tax bill
If your non‑homestead parcel qualifies, the cap can lower your taxable value compared with market value. At the same time, taxing units can respond by adjusting tax rates to meet budget needs. Independent analysis from the Baker Institute explains how capping some values can shift part of the tax burden to uncapped parcels, including many homesteads. Review that perspective in the Baker Institute’s research.
Elgin’s city, county, and school district hold annual budget and tax‑rate hearings before adopting rates. That is where any proposed rate changes show up for public input. For current local notices, see the City of Elgin’s public hearings and notices page.
What to do now
- Verify your NOAV. Look for both market value and the capped net appraised value. If you think you qualify but do not see a cap, contact BCAD. See BCAD’s circuit‑breaker page.
- Know your protest deadline. In Texas it is May 15 or 30 days after the NOAV was mailed, whichever is later. BCAD posts current instructions and options on its protest information page. The Comptroller also explains protest steps and forms on its state protest guide.
- Plan ahead if you expect to sell. A sale removes the limitation and the taxable value usually resets to market for the next owner. Talk with your agent and title team early so buyers understand the post‑sale tax change, as noted by IPT.
- Budget for improvements. New construction or major renovations are added at full market value and sit on top of the capped base, so model cash flow accordingly.
- Track ownership dates. To qualify, you must have owned the parcel on January 1 and for a full calendar year before the limitation applies. The rule is in Chapter 23 of the Tax Code.
- Know who to contact. BCAD handles valuations, NOAVs, and protests. For tax bills and payments, the Bastrop County Tax Assessor‑Collector is your point of contact; local notices and estimates are linked from BCAD’s tax estimate page.
Buying or selling in 2025
If you are buying, ask whether the current taxable value is capped and how it might reset after closing. That can affect escrow, cash flow, and negotiations. If you are selling, set clear buyer expectations in your disclosures and estimate sheets so the cap reset does not cause a surprise later.
When you want local, practical help, our team can review your NOAV, flag cap issues in your contract, and coordinate with title so everyone is aligned. For a clear plan tailored to your property in Elgin, connect with KHG Development Corp, DBA The Kelvin Glover Team.
FAQs
Does the 20 percent cap reduce taxes on my Elgin homestead?
- No. Homesteads are excluded from the non‑homestead cap and remain under the 10 percent homestead limitation with normal exemptions.
Which Elgin properties most often qualify for the cap?
- Non‑homestead parcels like rentals, small to mid‑size apartments, commercial buildings, and investment land if the value is at or below the annual threshold.
When does the cap start if I bought in 2024?
- You must own the property on January 1 and for a full calendar year before the cap applies, so eligibility typically begins the following tax year after that requirement is met.
What happens to the cap when a capped property is sold in Elgin?
- The limitation is removed at sale and the taxable value generally resets to market value for the next owner, subject to that owner re‑establishing eligibility over time.
Are new improvements protected by the 20 percent cap?
- No. New construction and qualifying renovations are added at full market value on top of the capped base.
Why did my 2024 Notice of Appraised Value show two numbers?
- BCAD shows both market value and the capped net appraised value for qualifying parcels, and taxes are based on the lower capped value.
Could my tax rate go up even if my value is capped?
- Yes. Local taxing units can adjust tax rates to meet budgets, which can shift burden to uncapped parcels even as some values are capped.