5 States That Could Eliminate Property Taxes — and What That Means for Residents
Property taxes are part of the real cost of owning a home, right alongside a mortgage, insurance and repairs.
Now, five states are considering changes that could reduce or eventually eliminate that bill for some residents. The potential savings are appealing, but cutting one tax does not erase the cost of schools, roads and emergency services. It changes the question of who pays.
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1. Florida’s Homestead Plan
If it passes, per the Tax Foundation, the non-school homestead exemption would cover property up to $150,000 in 2027 rise to $250,000 in 2028, then increase with inflation.
The Legislature would also have to create a uniform process allowing counties and municipalities to raise their non-school homestead exemptions, potentially up to a home’s full assessed value.
School taxes would remain, and renters wouldn’t receive the homestead break. New Florida residents would generally wait five years for the larger exemption.
“If local governments lose homestead revenue without matching spending reductions or state replacement money, the burden can migrate toward special assessments and fees,” tax attorney Chad Cummings said.
2. North Dakota’s Path to Zero
North Dakota is already reducing property taxes for some homeowners.
Its Primary Residence Credit can cut up to $1,600 from an eligible homeowner’s annual bill. It applies only to a primary residence, and households must apply each year.
While the credit doesn’t erase property taxes statewide, it’s part of Gov. Kelly Armstrong’s longer-term plan to put most primary residences on a “path to zero” property taxes within a decade.
The near-term wallet effect is straightforward.
Eligible homeowners can save up to $1,600 a year, while those with higher tax bills still owe the difference. Renters and owners of second homes don’t receive the credit, and the longer-term savings depend on whether lawmakers keep expanding the program.
3. Texas’ Tax Cut Strategy
Texas hasn’t put property-tax repeal on the November ballot. Instead, it has lowered school-tax bills by helping districts reduce their tax rates and by exempting more of a primary home’s value from school taxes.
Texas's residence homestead exemption now shields $140,000 of a primary home’s value from school-district taxes. Homeowners who are older or disabled can receive an additional $60,000 exemption.
While that lowers the school-tax portion of a homeowner’s bill, it doesn’t erase city, county or special-district property taxes.
In addition, lawmakers have examined the cost of eliminating school property taxes or property taxes altogether, but Cummings said those discussions remain preliminary.
“If state revenue weakens, Texas lawmakers must reduce spending or replace the money elsewhere,” he said. “This is a zero sum game.”
4. Indiana’s Full Repeal Bill
Indiana’s HB 1288 is more sweeping.
It would first end the process of assigning taxable values to homes, land and other physical property in 2026. A year later, it would stop local governments from levying property taxes.
Unlike other states, the bill includes a replacement plan. Indiana would extend sales and use taxes to many services that are not currently taxed, then send that revenue to local governments.
That could remove property taxes from a homeowner’s bill. But it could also raise the cost of services, from legal work to landscaping.
The bill was referred to the House Ways and Means Committee in January and has not advanced, so it remains a proposal, not a coming change.
5. Pennsylvania’s Constitutional Ban
Pennsylvania’s HB 900 takes the most direct approach.
The joint resolution would amend the state constitution to prohibit all property-tax assessment, valuation and taxation beginning July 1, 2030.
Unlike North Dakota’s credit or Florida’s exemption, the proposal wouldn’t limit relief to primary homes. It would apply across the state.
The 2030 start date gives lawmakers time to redesign how schools and local governments are funded. But the bill does not specify what would replace property-tax revenue.
Nevertheless, the legislation has been in the House Finance Committee since March 25, so residents wouldn’t see a change unless it advances.
The Bottom Line
A lower property-tax bill can help make homeownership more affordable. But experts say residents should look past the promise and ask what will replace the revenue.
“If the property tax is cut but the income tax is increased on a dollar-to-dollar basis, then the change will simply be a shift in who pays or in how the costs are manifested,” said Wayne Winegarden, senior fellow in business and economics at the Pacific Research Institute.
The strongest plans will show whether spending is being controlled, not just which tax bill gets smaller.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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