There is only a month left before property taxes are due and before the county starts adding penalties and interest. If you don’t have a plan in place, there are several payment options to think about.
The local tax collection office generally offers payment options. Here we will explain the different options that are available.
Credit Card Payment:
According to the Tax Code Section 31.06, the state tax code requires tax collectors to accept credit card payments but allows the collector to collect a fee for processing the payment, not surpass five percent of the expense of taxes. Also, there is the interest that has to be paid to the credit card company which typically is extremely high.
Some property owners may arrange for an instalment agreement of four payments that won’t result in penalties and interest.
Tax Code Section 31.031 enables specific persons to pay homestead taxes in four instalments without incurring interests and penalties. The first payment must be paid by the first instalment deadline and must be accompanied by a notice to the taxing unit that the remainder will be made in 3 equal payments.
If the taxpayer fails to make an instalment payment by the payment deadline, that payment will be charged a 6% penalty and 1% interest fee.
Tax Code Section 31.03 allows property owners to pay their property taxes in a split payment without penalty or interest. The first payment must be paid before December 1st and the second payment must be paid prior to July 1st. If the second payment is missed, penalties and interest will be retroactively added to the amount due.
Taxing entities will also allow homestead property owners to pay their taxes in monthly instalment plans. Typically, the taxing entity will require a down payment but will give a two year repayment option. There are some downsides to this option – the taxes still might incur penalties and interest and the next years taxes will need to be paid in full before they go delinquent. Also, if a monthly payment is missed all the penalties and interest fees will retroactively be added.
It is best if you call your local taxing entity to find out what payment options they offer and to get an agreement in writing before committing to one of their payment options. If their options do not work for you, a payment plan from an outside lender such as Ovation Lending might be the better option. A property tax loan offers repayment terms up to 10 years with lower interest rates than a credit card. Ovation offers a full range of solutions to fit your needs. Give us a call at 877-419-7392 or click here to apply.