Can a Texas taxing unit waive property tax penalties if the appraisal district caused the delinquency?

TX AG Opinion GA-0548: Can a taxing unit waive tax penalties caused by an appraisal district mistake?

Plain-English summary

A piece of property in Howard County was taxed by four local taxing units. Property taxes on it became delinquent for 2003, 2004, and 2005 because of an act or omission by an agent of the appraisal office. The taxpayer found out about the delinquency around October 15, 2006, and on October 30, 2006, paid the delinquent taxes for all three years under protest, including all the accrued penalties and interest, and submitted a written request asking the taxing units to waive those penalties and interest. The Howard County Attorney, on behalf of the taxing units, asked the Attorney General whether Tax Code section 33.011 (or any other law) let them grant the waiver.

The Attorney General laid out how section 33.011 works. When a taxpayer's failure to pay on time is caused by an act or omission of an officer, employee, or agent of the taxing unit or the appraisal district the unit participates in, the governing body of the taxing unit must waive penalties and may waive interest, provided the tax is paid no later than the 21st day after the date the taxpayer knew or should have known of the delinquency. So the appraisal-district-caused delinquency and prompt payment lined up with part of the statute.

The problem was a separate deadline in the same statute. Section 33.011(d) requires that a request for this kind of waiver "must be made before the 181st day after the delinquency date," and if a timely written request is not made, the governing body "may not waive any penalties or interest." The 2005 version of subsection (d) applied to the taxpayer's October 30, 2006 request. Because the request was not made before the 181st day after the delinquency date for any of the three years, the Attorney General concluded the plain language of section 33.011(d) barred the taxing units from waiving the penalties or interest.

The Attorney General also addressed whether any other statute or constitutional provision could authorize a waiver, but answered only generally because no specifics about the underlying act or omission were provided. It noted that a taxpayer is charged with knowledge of the law, especially tax law, and that a political subdivision cannot waive statutory penalties and interest without statutory authority. It pointed to the protest remedies in Tax Code sections 41.41 and 41.411, which let a property owner protest certain appraisal-district actions or a failure to deliver a required notice before the appraisal review board, subject to the filing deadlines in section 41.44. Whether any of those remedies are available, the opinion said, depends on the facts of the particular case.

Currency note

This opinion was issued in 2007. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The Tax Code provisions on delinquency dates, penalty-and-interest waivers, and appraisal-review-board protests cited here may have been amended since 2007, including the deadlines. Confirm the current text of Tax Code sections 33.011, 41.41, 41.411, and 41.44, and any current deadlines, before relying on this analysis.

Who this opinion affected (as of 2007)

Local taxing units and their governing bodies: The opinion told them that section 33.011 made waiving penalties mandatory (and interest discretionary) for an appraisal-district-caused delinquency paid within 21 days of discovery, but that they could not grant the waiver at all if the written request was not made before the 181st day after the delinquency date.

Property owners and taxpayers: The opinion meant that even when an appraisal district's mistake caused a delinquency, the taxpayer had to get a written waiver request in before the 181-day deadline to be eligible, and that a taxpayer is charged with knowledge of the law.

Appraisal districts: The opinion described the section 41.41 and 41.411 protest routes a property owner might use to challenge appraisal-district actions or a failure to deliver notice, subject to the section 41.44 deadlines, while noting availability turns on the facts.

Common questions

If an appraisal district's error made my property taxes late, must the taxing unit waive the penalties?
Under section 33.011, a taxing unit must waive penalties (and may waive interest) if the delinquency was caused by an act or omission of the taxing unit or appraisal district and the tax is paid within 21 days of when you knew or should have known. But you also have to meet the request deadline.

What is the deadline to ask for the waiver?
The written request must be made before the 181st day after the delinquency date. If it is not timely, the opinion concluded the governing body may not waive any penalties or interest.

The taxpayer here paid quickly and in writing. Why couldn't the taxing units waive?
Because, even though the tax was paid within 21 days of discovery and a written request was submitted, the request was not made within 181 days of the delinquency date. The plain language of section 33.011(d) barred the waiver.

Are there any other ways to challenge an appraisal district's mistake?
The opinion pointed to protests under Tax Code sections 41.41 and 41.411 before the appraisal review board, subject to the deadlines in section 41.44, but said whether those remedies are available depends on the facts of the case.

Background and statutory framework

Tax assessors mail tax bills by October 1 or as soon as practicable, taxes are due on receipt and delinquent if not paid before February 1 of the following year, and the delinquency date can be postponed if a bill is mailed after January 10; failure to send or receive a bill does not affect the tax's validity or the due date (Tex. Tax Code Ann. § 31.01(a), (g) (Vernon Supp. 2006); § 31.02(a); § 31.04(a); Aldine Indep. Sch. Dist. v. Ogg, 122 S.W.3d 257, 274-75 (Tex. App.-Houston [1st Dist.] 2003, no pet.)). Section 33.01 provides for penalty and interest on delinquent taxes (Tex. Tax Code Ann. § 33.01 (Vernon 2001)).

Section 33.011(a)(1) requires a taxing unit's governing body to waive penalties and lets it waive interest if an act or omission of an officer, employee, or agent of the taxing unit or the appraisal district caused the taxpayer's failure to pay before delinquency and the tax is paid no later than the 21st day after the taxpayer knew or should have known of the delinquency; related subsections address undelivered bills and electronic-transfer errors (Tex. Tax Code Ann. § 33.011(a)(1), (b), (h) (Vernon Supp. 2006)). But section 33.011(d) requires the written waiver request to be made before the 181st day after the delinquency date, and bars any waiver if a timely written request is not made; the 2005 amendment to subsection (d) governed the taxpayer's October 30, 2006 request. Because the request was not made within that window for any of the three years, the plain language barred the waiver (Tex. Tax Code Ann. § 33.011(d) (Vernon Supp. 2006)).

On other possible authority, a taxpayer is charged with knowledge of the law, especially tax law, and a political subdivision may not waive statutory penalties and interest absent statutory authority (Mexia Indep. Sch. Dist. v. City of Mexia, 133 S.W.2d 118, 121 (Tex. 1939); Texaco, Inc. v. Short, 454 U.S. 516, 532 (1982)). Section 41.41 lets a property owner protest certain appraisal-district actions, and section 41.411 lets a property owner protest a failure to deliver a required notice, before the appraisal review board, subject to the deadlines in section 41.44, with availability depending on the facts (Tex. Tax Code Ann. § 41.41(a)(9), § 41.411(a) (Vernon 2001); § 41.44, § 41.44(c) (Vernon Supp. 2006)).

Citations

Statutes:

• Tex. Tax Code Ann. § 31.01(a), (g) (Vernon Supp. 2006)
• Tex. Tax Code Ann. § 31.02(a)
• Tex. Tax Code Ann. § 31.04(a)
• Tex. Tax Code Ann. § 33.01 (Vernon 2001)
• Tex. Tax Code Ann. § 33.011(a)(1), (b), (d), (h) (Vernon Supp. 2006)
• Tex. Tax Code Ann. § 41.41(a)(9) (Vernon 2001)
• Tex. Tax Code Ann. § 41.411(a) (Vernon 2001)
• Tex. Tax Code Ann. § 41.44, § 41.44(c) (Vernon Supp. 2006)

Cases:

• Aldine Indep. Sch. Dist. v. Ogg, 122 S.W.3d 257, 274-75 (Tex. App.-Houston [1st Dist.] 2003, no pet.)
• Mexia Indep. Sch. Dist. v. City of Mexia, 133 S.W.2d 118, 121 (Tex. 1939)
• Texaco, Inc. v. Short, 454 U.S. 516, 532 (1982)

Attorney General opinions referenced: JM-1192 (1990), LO-93-58, JM-74 (1983).

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/greg-abbott/ga-0548
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/2007/ga0548.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain - the linked PDF is authoritative.

ATTORNEY GENERAL OF TEXAS

GREG ABBOTT

May 24, 2007

The Honorable C.E. "Mike" Thomas, III
Howard County Attorney
Post Office Box 2096
Big Spring, Texas 79721-2096

Opinion No. GA-0548

Re: Authority of a local taxing unit to waive penalties and interest on taxes that became delinquent as a result of an act or omission of an officer, employee, or agent of the appraisal district (RQ-0555-GA)

Dear Mr. Thomas:

On behalf of several local taxing units you ask the following question:

May local taxing units waive penalties and interest pursuant to Property Tax Code Section 33.011 (or any other provision of the Property Tax Code) on delinquent ad valorem taxes which became delinquent as a result of an act or omission of an agent of the appraisal district, which were paid in full (including all accrued penalties and interest) within 21 days after the taxpayer knew or should have known of the delinquency, when a written request for such waiver was received within such 21 day period, but not within the 181st day after the delinquency date?[1]

Your request relates to a specific property, which is subject to ad valorem tax by four political subdivisions. See Request Letter, supra note 1, at 1. The tax assessor for each taxing unit is required to mail tax bills to persons in whose names property is listed by October 1 or as soon thereafter as practicable. See TEX. TAX CODE ANN. § 31.01(a) (Vernon Supp. 2006). Subject to narrow exceptions, "taxes are due on receipt of the tax bill and are delinquent if not paid before February 1 of the year following the year in which imposed." Id. § 31.02(a). If a tax bill is mailed after January 10, the delinquency date will be postponed until a certain date after the date of mailing to allow for paying the taxes before they become delinquent. See id. § 31.04(a). But if no bill is mailed to the taxpayer because his address is unknown, the February 1 delinquency date will still apply. See Aldine Indep. Sch. Dist. v. Ogg, 122 S.W.3d 257, 274-75 (Tex. App.-Houston [1st Dist.] 2003, no pet.) (citing Tex. Att'y Gen. Op. No. JM-1192 (1990) at 8); see also TEX. TAX CODE ANN. § 31.01(g) (Vernon Supp. 2006) (failure to send or receive the tax bill required by section 31.01 "does not affect the validity of the tax, penalty, or interest, the due date, the existence of a tax lien, or any procedure instituted to collect a tax"). Tax Code section 33.01 provides for penalty and interest on delinquent taxes. See TEX. TAX CODE ANN. § 33.01 (Vernon 2001).

You inform us that taxes became delinquent on the property in question for the years 2003, 2004, and 2005 as a result of an act or omission by an agent of the appraisal office. See Request Letter, supra note 1, at 1. The taxpayer became aware of the delinquency on or about October 15, 2006, and paid under protest the delinquent taxes for all three years, including all accrued penalty and interest, on October 30, 2006. See id. at 1-2. The taxpayer included with the payment a written request for a waiver of penalties and interest. See id. at 2. You ask whether Tax Code section 33.011 may authorize the taxing units to waive penalties and interest. See id. at 1-2. This provision states in part:

(a) The governing body of a taxing unit:

(1) shall waive penalties and may provide for the waiver of interest on a delinquent tax if an act or omission of an officer, employee, or agent of the taxing unit or the appraisal district in which the taxing unit participates caused or resulted in the taxpayer's failure to pay the tax before delinquency and if the tax is paid not later than the 21st day after the date the taxpayer knows or should know of the delinquency[.]

TEX. TAX CODE ANN. § 33.011(a)(1) (Vernon Supp. 2006); see also id. § 33.011(b) (waiver of interest and penalties if a tax bill is returned undelivered to the governmental body, subject to additional conditions), (h) (waiver of interest and penalties if a tax payable by electronic funds transfer was delinquent because of an error in the transmission).

The section 33.011 waiver provisions are, however, subject to the following limitation:

A request for a waiver of penalties and interest under Subsection (a)(1), (b), or (h) must be made before the 181st day after the delinquency date. . . . To be valid, a waiver of penalties or interest under this section must be requested in writing. If a written request for a waiver is not timely made, the governing body of a taxing unit may not waive any penalties or interest under this section.

Id. § 33.011(d) (emphasis added). The italicized language of section 33.011(d) was adopted by an act of the Seventy-ninth Legislature that included the following transition clause:

Section 33.011, Tax Code, as amended by this Act, applies only to a request for a waiver of penalty or interest made on or after the [September 1, 2005] effective date of this Act. A request for a waiver made before the effective date of this Act is governed by the law as it existed immediately before the effective date of this Act, and the former law is continued in effect for that purpose.

Act of May 29, 2005, 79th Leg., R.S., ch. 1126, § 29(g), 2005 Tex. Gen. Laws 3717, 3730. See also id. § 15, at 3723 (amending Tax Code section 33.011(d)); id. § 30, at 3731 (effective September 1, 2005).

Section 33.011(d) of the Tax Code, as amended in 2005, applies to the taxpayer's written request for a waiver of penalties and interest made on October 30, 2006. See id. § 29(g), at 3730. You have stated that the taxpayer's written request for a waiver of penalties and interest was not made before the 181st day after the delinquency date for each of the three years in which taxes were delinquent. See Request Letter, supra note 1, at 2. The plain language of section 33.011(d) compels us to conclude that the taxing units may not waive penalties or interest on the delinquent taxes.

You ask whether any other statute or constitutional provision authorizes taxing units to waive the penalties and interest on this account. See id. at 1-2. Because you provide no specifics about the act or omission causing the taxpayer's failure to pay his taxes on time, we will answer your questions in general terms.

We note initially that a taxpayer is charged with knowledge of the law. See Mexia Indep. Sch. Dist. v. City of Mexia, 133 S.W.2d 118, 121 (Tex. 1939); see also Texaco, Inc. v. Short, 454 U.S. 516, 532 (1982) (property owners are especially charged with knowledge of laws relating to taxation). Moreover, a political subdivision may not waive penalties and interest imposed by statute absent statutory authority. See Tex. Att'y Gen. LO-93-58, at 2 (special district may not waive penalties and interest due on delinquent taxes); see also Tex. Att'y Gen. Op. No. JM-74 (1983) at 2 (appraisal district may not waive penalties and interest imposed upon taxing units that are delinquent in paying their share of the district's expenses). Tax Code section 41.41 entitles a property owner to protest certain actions before the appraisal review board, including "any other action of the chief appraiser, appraisal district, or appraisal review board that applies to and adversely affects the property owner," and section 41.411 authorizes a property owner to "protest before the appraisal review board the failure of the chief appraiser or the appraisal review board to provide or deliver any notice to which the property owner is entitled." TEX. TAX CODE ANN. §§ 41.41(a)(9), .411(a) (Vernon 2001). A notice of the protest must be filed with the appraisal review board according to the applicable deadlines of section 41.44. See id. § 41.44 (Vernon Supp. 2006); see also id. § 41.44(c) (notice of protest authorized by section 41.411 must be filed before the date when the taxes become delinquent). Whether any remedies are available to a particular taxpayer depends on the facts of that case.

SUMMARY

Tax Code section 33.011 requires a taxing unit to waive penalties and authorizes it to waive interest on a delinquent tax if the taxpayer's failure to pay the tax before delinquency resulted from an act or omission of an officer, employee, or agent of the taxing unit or the appraisal district in which the taxing unit participates and if the tax was paid not later than the 21st day after the date the taxpayer knew or should have known of the delinquency. Section 33.011 requires such a request for a waiver of penalties and interest to be made before the 181st day after the delinquency date.

Very truly yours,

GREG ABBOTT
Attorney General of Texas

KENT C. SULLIVAN
First Assistant Attorney General

ELLEN L. WITT
Deputy Attorney General for Legal Counsel

NANCY S. FULLER
Chair, Opinion Committee

Susan L. Garrison
Assistant Attorney General, Opinion Committee

Footnotes

[1] Letter from Honorable C.E. "Mike" Thomas, III, Howard County Attorney, to Honorable Greg Abbott, Attorney General of Texas, at 1 (Nov. 15, 2006) (on file with the Opinion Committee, also available at http://www.oag.state.tx.us) [hereinafter Request Letter].