Texas homeowners who are 65 or older, or disabled, can pay their property tax in four equal installments with no penalty or interest, but the choice has to be made at the start. Pay nothing by Jan. 31 and skip the option, and the Texas Comptroller says a 6 percent penalty and 1 percent interest land on Feb. 1, with the penalty reaching 12 percent by July.
The stakes are easiest to see on a real bill. On a $5,000 bill left unpaid past January, the first-month charge is about $350 in penalty and interest combined. By July the penalty alone is $600, and six months of interest adds roughly $300 more.
What the Comptroller says happens after Jan. 31
The Comptroller’s office says that in most cases property taxes must be paid by Jan. 31, and that unpaid taxes become delinquent on Feb. 1. If a bill is mailed late, the delinquency date moves to the first day of a later month that allows at least 21 days to pay.
Once a bill is delinquent, the tax collector adds a six percent penalty and one percent interest on Feb. 1. The penalty then grows by one percentage point a month until July 1, when it becomes 12 percent. Interest keeps running at one percent a month, and the Comptroller says it has no maximum.
That distinction matters because the 12 percent is the penalty alone. The Tax Code sets the penalty at six percent for the first month a tax is delinquent, plus one percent for each additional month before July 1, and interest is a separate one percent a month. By July, the combined add-on on an unpaid bill is therefore well above 12 percent.
The question for a homeowner in this position is plain: split the bill into four payments, or pay it whole by Jan. 31. Anyone 65 or older with a homestead exemption who cannot pay the full amount in January should make the first quarter payment, with written notice that three more equal payments will follow, before Feb. 1 if possible and no later than the end of February. The Travis County Tax Office, at tax-office.traviscountytx.gov, bills homeowners in Austin and surrounding Travis County, and other counties publish their own forms through their tax assessor-collectors.
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How the quarterly option for owners 65 and older works
The option comes from Tax Code Section 31.031. It covers people who are 65 or older, or disabled, and who hold the residence homestead exemption, plus certain disabled veterans and their unmarried surviving spouses. The statute allows four equal installments without penalty or interest if the first is paid before the delinquency date.
The first payment has to come with notice that the rest will follow in three equal installments. Where the delinquency date is Feb. 1, the second installment is due before April 1, the third before June 1 and the fourth before August 1. The law also lets the first installment and notice arrive as late as the first day of the month after the delinquency date, which is why the end of February is the outer limit for starting.
Should a household take the option and then miss one payment, that unpaid installment becomes delinquent and draws a six percent penalty plus interest. The earlier installments stay penalty-free.
Why a deferral is a different thing
The quarterly option should not be confused with a deferral. Under Tax Code Section 33.06, a homeowner who is 65 or older, or disabled, and who lives in the home can defer collection of the tax by filing an affidavit with the chief appraiser. No Section 33.01 penalty is incurred during the deferral, but interest accrues at five percent a year.
The Travis County Tax Office describes the same arrangement on its over-65 and disabled exemptions page. Taxes stay postponed for as long as the owner lives in the home, accrue five percent interest annually until the deferral is removed, and must be paid with ordinary penalty and interest if they are not settled within 180 days after the property stops qualifying. The affidavit must be notarized.
The two tools solve different problems. An installment plan spreads one year’s bill over four payments and ends by August. A deferral postpones the bill, and the debt grows at five percent until it is paid, usually when the home is sold or changes hands.
If the bill is already late
An owner who misses January still has a route back. The Comptroller says some tax collectors allow delinquent taxes to be paid in installments for up to 36 months, though they are not required to offer it except on a residence homestead. Signing an agreement is treated as an irrevocable admission that the taxes are owed.
Travis County says homestead owners can pay delinquent taxes in twelve monthly payments and save on penalties. Under its plan the penalty rate is frozen and stops climbing each month, though interest still starts at one percent and rises one percent a month until the taxes are paid. A missed payment ends the freeze, and the taxes are recalculated as if no agreement had been made. Owners are also barred if they entered a homestead agreement in the preceding 24 months.
Partial payments made before the Jan. 31 deadline are not charged penalty and interest, the county adds. For a household that cannot manage a quarter of the bill in February, paying something in January is cheaper than paying nothing.
What waiting costs against what splitting costs
The arithmetic favors acting early. A $5,000 bill split into four payments costs $1,250 at a time and no extra money if every date is met. The same bill left alone costs $5,350 to settle in February, rising to about $5,900 by July once the 12 percent penalty and six months of interest are counted. These figures are worked from the published rates and ignore any collection fees the county may add.
Owners with a mortgage escrow account should check with the lender, since escrow servicers often pay the full bill in January on the borrower’s behalf. Owners who pay directly are the ones for whom the installment deadline matters.
Split the Texas bill, or pay the penalty?
A homeowner who lets the January date pass without choosing faces a penalty that doubles from six to twelve percent in five months, with interest running on top. The tax bill is also only one line in what an older owner pays each year to keep a house.
“The Senior Property Tax & Home-Cost Relief Kit” walks through “the 5 kinds of property-tax relief” and includes “an application log and renewal calendar,” so each deadline and each exemption renewal sits on one page. Part 2, “Reading the Tax Bill, Line by Line,” shows where the penalty and interest lines appear on a bill.
Track the Texas quarterly deadline with the property-tax relief kit →
This article was produced with AI assistance and edited for accuracy against the sources linked above.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
