How Much Are Property Taxes Typically on a $500,000 Home in Keller, Texas

Texas has no state income tax, and property taxes are the primary way local governments fund services. Every homeowner in Keller pays a combined rate made up of several individual taxing entities, each with its own rate set annually. Those entities include Tarrant County, the City of Keller, the Keller Independent School District, and in some cases a special district such as a municipal utility district or a hospital district. The total rate you pay is the sum of all applicable entity rates applied to your home's assessed value.

Who Sets the Rate

Each taxing entity adopts its own tax rate every fall, typically in August or September, after the appraisal process is complete. Tarrant County sets the county rate, the City of Keller sets the municipal rate, and Keller ISD sets the school district rate. These three entities account for the bulk of every Keller homeowner's tax bill. The Tarrant County Hospital District and Tarrant County College District add smaller amounts on top of those. Rates are expressed in dollars per $100 of assessed value, so a combined rate of $2.10 per $100 means you owe $2.10 for every $100 of your home's taxable value.

How Your Home Gets Assessed

The Tarrant Appraisal District, commonly called TAD, is the independent agency responsible for valuing every property in Tarrant County each year. TAD appraisers use sales data, comparable properties, and physical characteristics of your home to arrive at an appraised market value. That value is then reduced by any exemptions you qualify for to produce your taxable value, and the combined tax rate is applied to that taxable value to calculate your annual bill. The appraisal is separate from the price you paid for the home, and the two numbers do not always match.

2. What Is the Typical Property Tax Rate in Keller, Texas

The combined property tax rate for most Keller addresses currently runs between approximately 1.9% and 2.5% of assessed value, depending on which specific taxing entities apply to that address. For a home assessed at $500,000, that translates to a gross annual tax bill somewhere between $9,500 and $12,500 before any exemptions are applied. The exact rate varies by location within Keller because some addresses fall within additional special districts. Always verify the specific rate for any property you are seriously considering by checking the Tarrant Appraisal District website or asking your agent to pull the current tax record.

The Taxing Entities That Apply to Keller Addresses

Most homes in Keller sit within the Keller ISD boundary, which historically carries the largest single portion of the combined tax rate. As of 2026, the Keller ISD rate has been reduced in recent years due to state compression mandates, but it still represents roughly half or more of the total combined rate for most addresses. The City of Keller contributes its own operations and maintenance rate. Tarrant County, Tarrant County Hospital District, and Tarrant County College District each add smaller increments. A handful of addresses in Keller's growth corridors near Alliance Town Center or along the FM 1709 corridor may also fall within a municipal utility district that adds a further increment.

Estimated Annual Tax on a $500,000 Home

Using a midpoint combined rate of roughly 2.1% for a standard Keller address with no special districts, a $500,000 assessed value produces a gross annual tax bill of approximately $10,500. After applying a standard homestead exemption, which is explained in the next section, that figure drops meaningfully. A homeowner who qualifies for the general homestead exemption could see a taxable value closer to $475,000 or lower depending on the entity-level exemption amounts, reducing the annual bill by several hundred dollars. These are estimates; your actual bill depends on the rate your address carries and the assessed value TAD assigns after you close.

For context on how Texas compares nationally, Forbes has published a breakdown of property taxes by state showing Texas among the higher-rate states nationally, largely because the absence of a state income tax places more of the funding burden on property owners. Keller's suburban location in the DFW metroplex, with its strong infrastructure and proximity to employment centers in Southlake, Fort Worth, and the Alliance corridor, means the local taxing entities have historically maintained rates that reflect those service levels.

3. Exemptions That Lower Your Property Tax Bill

Texas offers several exemptions that can reduce the taxable value of your home, and every Keller homeowner who occupies their property as a primary residence should apply for them. Exemptions do not happen automatically when you buy; you must file an application with the Tarrant Appraisal District, and the deadline is typically April 30 of the tax year for which you want the exemption to apply. Missing the deadline means waiting another full year, which is a costly oversight on a $500,000 home.

Homestead Exemption

The general homestead exemption is the most widely used and reduces the taxable value of your home for each taxing entity that offers it. At the school district level, Texas law provides a mandatory $100,000 homestead exemption off the appraised value for school taxes, a figure that was raised from $40,000 in recent years. That alone saves a Keller homeowner hundreds of dollars annually. The City of Keller and Tarrant County also offer their own percentage-based or flat-dollar exemptions on top of the school district exemption. Stacking all available exemptions can reduce your effective taxable value by $100,000 or more depending on the entity.

Over-65 and Disability Exemptions

Homeowners who are 65 or older, or who qualify under a disability designation, receive additional exemptions and an important school tax freeze. Once you qualify for the over-65 exemption, your school district taxes are frozen at the level they were in the year you first qualified, regardless of future appraisal increases. On a $500,000 home in Keller, that freeze can represent significant long-term savings if property values continue to rise. The disability exemption works similarly and is available to homeowners who meet the Social Security Administration's definition of disability. Both exemptions require a separate application to TAD.

Texas Property Tax Relief Law

Texas passed significant property tax relief legislation in 2023 that continues to benefit Keller homeowners through 2026. The legislation raised the homestead exemption for school taxes, compressed school district tax rates, and provided additional relief mechanisms for residential property owners. HousingWire covered the details of this relief law and the cumulative savings it delivers to Texas homeowners over time. If you are buying a $500,000 home in Keller right now, you are purchasing at a time when these relief measures are in effect, which makes the net tax burden lower than it would have been under the prior framework.

4. How Assessed Value Differs From Purchase Price

One of the most common misconceptions buyers bring to the table is assuming their property tax bill will be based directly on their purchase price. In Texas, the Tarrant Appraisal District sets its own assessed value independently of what you paid. That value may be higher or lower than your purchase price, though TAD does use sales data from the surrounding market to calibrate its estimates. In Keller's active real estate market, where homes in established subdivisions like Hidden Lakes, Keller Crossing, and the areas around Bear Creek Parkway have seen steady appreciation, TAD assessed values have trended upward in recent years.

What the Tarrant Appraisal District Actually Does

TAD appraises every property in Tarrant County as of January 1 each year and mails notices of appraised value in the spring. If you buy a home in Keller in the fall of one year, your first full tax bill as the owner will be based on the value TAD established the prior January 1, not on your purchase price. The following January 1, TAD will re-appraise the property and may adjust the value based on current market conditions. Texas law limits how much a homestead-exempt property's taxable value can increase in a single year to 10% above the prior year's assessed value, which provides a meaningful cap for long-term owners.

Protesting Your Appraisal

Every Keller homeowner has the right to protest their TAD appraisal if they believe the assessed value is higher than market value, and many do so successfully. The protest deadline is typically May 15 or 30 days after TAD mails your notice, whichever is later. You can file online, by mail, or in person. Comparable sales in your neighborhood, any condition issues with your property, or a recent appraisal from a licensed appraiser can all support your case. On a $500,000 home, even a modest reduction in assessed value of $20,000 to $30,000 can save several hundred dollars annually at Keller's combined tax rate.

5. Budgeting for Property Taxes When Buying in Keller

Property taxes in Keller should be treated as a core line item in your monthly housing budget, not an afterthought. On a $500,000 home with a gross annual tax bill of roughly $10,500 before exemptions, that works out to about $875 per month. After applying the homestead exemption and the school tax compression relief currently in effect, a realistic net monthly figure for many buyers lands closer to $750 to $825 depending on the specific address and exemption stack. Your mortgage lender will typically collect this amount monthly through an escrow account and pay your tax bills on your behalf.

If you are also factoring in closing costs, Lauren DuBose has a detailed breakdown of what buyers should budget for when closing on a Keller home in the closing costs guide for Keller, Texas buyers. Understanding both your upfront costs and your ongoing tax obligation gives you a much clearer picture of total ownership cost before you make an offer.

Escrow and Monthly Payment Impact

Most lenders require an escrow account for property taxes when your down payment is less than 20%, and many buyers choose escrow even when it is not required. Your lender will estimate your annual tax liability and divide it by 12 to determine your monthly escrow contribution. Because Texas property taxes are paid in arrears and are due by January 31 of the following year, your lender will build a cushion into the escrow account to ensure funds are available. If your actual tax bill comes in higher than estimated, you will receive an escrow shortage notice and your monthly payment will adjust upward the following year.

What Changes After You Close

The first year after closing, your tax bill may reflect the prior owner's exemption status rather than yours, which can create temporary discrepancies. If the prior owner had an over-65 freeze in place, that freeze does not transfer to you; your taxable value reverts to the full assessed value. File your homestead exemption application as soon as you close and occupy the home as your primary residence. You can file anytime during the year and the exemption will apply for that tax year as long as you owned and occupied the property on January 1. Staying on top of that filing deadline is one of the most straightforward ways to reduce your property tax bill in Keller.

For a broader look at what the Keller real estate market looks like right now, including price trends and what buyers are seeing across different parts of the city, the Keller, Texas real estate market guide covers current conditions in detail.

6. Other Property Tax Considerations Specific to Keller

Keller sits almost entirely within Tarrant County, though a small number of properties near the northern edge of the city touch Denton County. If a property you are considering has a Keller mailing address but falls within Denton County, the taxing entities and rates will differ from the Tarrant County structure described above. Always confirm the county designation on the TAD or Denton Central Appraisal District website before assuming a rate. Your title company will also confirm this during the title search process.

New Construction and Property Taxes

New construction homes in Keller, including those in active subdivisions along the Highway 170 corridor and near the Keller Town Center area, carry a particular tax consideration. In the first year or two after a new home is built, TAD may assess only the land value or an incomplete improvement value if the home was not finished as of January 1. Once TAD performs a full assessment of the completed structure, the taxable value can increase substantially, sometimes catching new construction buyers off guard. If you are buying new construction in Keller, ask your agent to help you estimate what TAD is likely to assess the completed home at, rather than relying solely on the builder's quoted tax estimate. Lauren DuBose has specific experience with new construction purchases in Keller and can walk you through what to expect, as detailed in the new construction home purchases guide for Keller.

Tax Proration at Closing

Because Texas property taxes are paid in arrears, the seller owes taxes for the portion of the year they owned the home, even though the bill has not yet come due. At closing, the title company calculates a tax proration: the seller credits the buyer for the estimated taxes accrued from January 1 through the closing date, and the buyer then pays the full annual bill when it comes due in the fall. On a $500,000 home closing in mid-year, that proration credit from the seller can amount to $4,000 to $6,000, which is real money that effectively reduces your out-of-pocket at closing. Make sure your purchase contract addresses proration clearly and that your agent confirms the calculation with the title company.