If you’ve ever paid off a 30-year mortgage only to realize you’re still writing a four-figure check to the county for property taxes every year, you know the feeling.
It’s like you never truly own your home; you’re just renting it from the taxman.
Right now, there’s a growing movement across the country to change that. Politicians in states like Florida, Texas and Wyoming are making a lot of noise about eliminating property taxes entirely.
It sounds like a dream come true for anyone on a fixed income or a tight budget. But before you start planning how to spend that extra cash, we need to look at the fine print.
In the world of government finance, there’s no such thing as a free lunch — just a different person holding the bill.
Which states are trying to pull this off?
We aren’t just talking about a few small credits here. Several state legislatures are swinging for the fences with bills that would fundamentally change how your local community stays afloat.
- Florida: Lawmakers are moving forward with HJR 203 and HJR 201, which aim to eliminate “non-school” property taxes for homesteads. This would wipe out the portion of your bill that funds everything from local parks to police, potentially shifting that $18 billion burden elsewhere.
- Texas: Governor Greg Abbott has proposed a five-point plan to eventually eliminate school property taxes for homeowners. He’s pushing to use state budget surpluses to “buy down” these taxes, though critics wonder what happens if the surplus dries up.
- Wyoming: There is a certified 2026 ballot initiative that would exempt 50% of a primary residence’s assessed value from property taxation. While it’s popular with residents, some lawmakers warn it could gut funding for local schools.
- North Dakota: In late 2024, voters faced Measure 4, which would have prohibited all property taxes on assessed value. Despite the promise of big savings, North Dakotans rejected it by 63% because of concerns over how to replace $1.3 billion in annual local revenue.
The catch: The tax swap you didn’t ask for
Here’s the thing: Those billions of dollars in property tax revenue don’t just vanish into a black hole. They pay for the road you drive on and the ambulance that shows up when you call 911.
If the state takes away property taxes, they have to get that money from somewhere else.
Usually, that means a massive hike in sales tax. In Florida, researchers found that to fully replace property tax revenue, the state sales tax would have to more than double — jumping from around 6% to over 15%.
Imagine paying 9% extra on every toothbrush, car and pair of shoes you buy. That hits retirees and low-income families a lot harder than a property tax bill ever did.
The school funding shell game
Most of these proposals have a giant asterisk: They often leave school taxes alone. Since school districts usually account for about half of your tax bill, “eliminating” property taxes often just means cutting your bill in half, not getting rid of it.
We’ve seen this play out before. When taxpayers realize that if the state controls all the money, then the local school board loses its power, they get nervous. You’re essentially trading local control for a “discount” that might cost you more in the long run.
What this means for your wallet
Don’t go out and buy a boat with your “saved” tax money just yet. Here’s how to handle the hype:
- Watch the sales tax: If your state is talking about cutting property taxes, look at what they want to tax instead. If they’re eyeing a consumption tax, your cost of living might actually go up.
- Check your local levies: Most of these elimination bills only target state-level or non-school taxes. Your local city council can still tack on fees for trash, sewer and special districts.
- Don’t bet on the ballot: Even if these bills pass the legislature, they usually require a constitutional amendment. That means you — the voter — have to approve it. History shows that when taxpayers see the replacement costs, they usually get cold feet.
At the end of the day, I’d love to stop paying property taxes as much as the next guy. But I also like having a fire department that answers the phone.
Until these states find a way to fund the essentials without raiding our wallets elsewhere, “tax-free” homeownership remains a beautiful, expensive fantasy.
