JD Key Consulting Logo
Signed Into Law
Signed June 20, 2025Effective 2025-09-01
SB1352

Regular Session

Relating to the deadline for filing an application for certain ad valorem tax exemptions or allocations and the calculation of the penalty for filing a late application for such an exemption or allocation.

Government Affairs & Regulatory Compliance Analysis

SB1352: Government Affairs Overview

SB1352 fundamentally alters property tax compliance for Texas businesses holding interstate inventory or assets by synchronizing the filing deadlines for Freeport Exemptions and Interstate Allocations with your Business Personal Property (BPP) Rendition extensions. Effective for the 2026 tax year, this legislation also caps late-filing penalties at the lesser of 10% of the tax savings or 10% of the actual tax imposed, significantly reducing financial exposure for logistics, manufacturing, and transportation sectors.

Sen. Adam Hinojosa·Senate Bill·Regular Session

Moderate
Low Cost
Effective:2025-09-01
Business Impact

Who SB1352 Affects

This legislation has regulatory implications for the following Texas businesses and organizations:

Regulatory Priority: moderate

Notable regulatory updates (effective 2025-09-01). Consider how these changes may affect your operations.

🏢

Real Estate

Affected business types:

  • Property developers
  • Commercial landlords
  • Property managers
  • Real estate investors
View all real estate legislation

Estimated Cost Impact

lowMinimal cost impact anticipated.

Enforcing Agencies

Need Government Relations Support?

JD Key Consulting provides government affairs and regulatory strategy services. We help businesses navigate Texas agencies, understand legislative impacts, and advocate for their interests.

Need Help Navigating This Legislation?

JD Key Consulting provides strategic guidance on Texas regulatory compliance and legislative impact for your business.

SB1352
Moderate
Relating to the deadline for filing an application for certain ad valorem tax exemptions or allocations and the calculation of the penalty for filing ...
Moderate Compliance Urgency
Requires near-term attention
Cost Impact
Low
Effective
2025-09-01
Enforcing Agencies
County Appraisal DistrictsLocal Taxing Units
Primary Author: Sen. Adam Hinojosa
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025.
  • Compliance Deadline: April 1, 2026. This is the operational deadline to request a Rendition extension for the 2026 tax year, which is the trigger required to utilize the new automatic extension for exemption filings.
  • Agency Rulemaking: The Texas Comptroller is not required to issue new rules, but County Appraisal Districts (CADs) must update their internal software and compliance matrices before January 1, 2026, to recognize the linked deadlines.

Immediate Action Plan

  • 1. Update 2026 Tax Calendar: Move the internal deadline for Freeport and Allocation data collection to align with the May 15 Rendition extension date.
  • 2. Audit Consultant Scopes: Ensure your external tax agent's Scope of Work explicitly requires them to file the Rendition Extension request to trigger the Exemption extension.
  • 3. Establish Proof Protocols: Mandate that the Rendition Extension approval letter be saved in the permanent tax file for the corresponding asset year.
  • 4. Review Pending Litigation: Note that this law is not retroactive. Do not attempt to apply these penalty caps to disputes regarding tax years prior to 2026.

Operational Changes Required

Contracts

  • Third-Party Tax Consultants: Renegotiate Master Service Agreements (MSAs) immediately. If fee structures are based on "penalty avoidance" or a percentage of "tax savings," the value of these services has decreased due to the statutory penalty cap.
  • Triple Net (NNN) Leases: Landlords must review lease terms to ensure the new, lower administrative penalties can still be passed through to tenants if the penalty results from tenant delays in reporting inventory data.

Hiring/Training

  • Cross-Departmental Synchronization: Finance teams (handling Renditions) and Tax/Legal teams (handling Exemptions) must be integrated. Staff must be trained that obtaining a Rendition extension now creates a mandatory legal extension for Exemption filings.
  • "Good Cause" Documentation: Compliance officers must be trained to document operational failures (e.g., IT outages, records destruction) immediately to support potential "good cause" extension requests.

Reporting & Record-Keeping

  • Affirmative Defense File: You must retain the written Rendition Extension Approval (Section 22.23(b)) physically and digitally. This document must be attached to any Exemption application filed between May 1 and May 15 to force CAD acceptance.
  • Forms: Utilize Form 50-113 (Freeport) and Form 50-144 (Allocation). No new forms are mandated, but cover letters must now reference the Rendition extension.

Fees & Costs

  • Penalty Reduction: The law eliminates the risk of penalties exceeding the tax bill itself. Penalties are now capped at the lesser of 10% of the tax savings or 10% of the tax imposed.
  • Budgeting: Adjust reserve funds for tax disputes downward for the 2026 cycle due to the lowered liability cap.

Strategic Ambiguities & Considerations

  • The "Automatic" Link: The law requires an automatic extension for Exemptions if a Rendition extension is granted. However, CAD software systems are often siloed. There is a high risk that the Exemption department will not see the Rendition extension and will erroneously flag filings as late.
  • "Good Cause" Definition: The statute allows further extensions (60 days for Freeport, 30 for Allocation) for "good cause," but leaves the definition to the Chief Appraiser's discretion. Expect strict interpretation from major CADs (Harris, Dallas, Tarrant); do not rely on this as a standard operating procedure.

Need Compliance Guidance on This Legislation?

JD Key Consulting specializes in Texas regulatory compliance strategy. Work directly with James Dickey—former Chairman of the Republican Party of Texas—to understand this bill's impact on your operations and develop an actionable compliance plan.

Schedule a Consultation

Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

02

Legislative Timeline

This bill's path through the Texas Legislature

Filed
Feb 18, 2025
Passed Senate
Apr 10, 2025
Passed House
May 24, 2025
Signed
Jun 20, 2025
Effective
Sep 1, 2025
TopicsTaxationTaxation--property-appraisals & Appraisal DistrictsTaxation--property-assessment & CollectionTaxation--property-exemptions
03

Senate Authors

Sen. Adam HinojosaRepublican · Primary Author

House Sponsor

Rep. Giovanni CapriglioneRepublican · Primary Sponsor

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

Related Legislation

Explore more bills from this author and on related topics

More from Sen. Adam Hinojosa

View all bills by Sen. Adam Hinojosa

Related by Topic

View more Taxation legislation
Quick Reference

Frequently Asked Questions

Common questions about SB1352

Q

What does Texas SB1352 do?

SB1352 fundamentally alters property tax compliance for Texas businesses holding interstate inventory or assets by synchronizing the filing deadlines for Freeport Exemptions and Interstate Allocations with your Business Personal Property (BPP) Rendition extensions. Effective for the 2026 tax year, this legislation also caps late-filing penalties at the lesser of 10% of the tax savings or 10% of the actual tax imposed, significantly reducing financial exposure for logistics, manufacturing, and transportation sectors.

Q

Who authored SB1352?

SB1352 was authored by Texas Senator Adam Hinojosa during the Regular Session.

Q

When was SB1352 signed into law?

SB1352 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce SB1352?

SB1352 is enforced by County Appraisal Districts (Chief Appraisers) and Local Taxing Units.

Q

How significant are the changes in SB1352?

The regulatory priority for SB1352 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of SB1352?

The cost impact of SB1352 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does SB1352 address?

SB1352 addresses topics including taxation, taxation--property-appraisals & appraisal districts, taxation--property-assessment & collection and taxation--property-exemptions.

Q

What are the key dates for SB1352?

Key dates for SB1352: Effective date is 2025-09-01. Consult with legal counsel regarding applicability.

Q

What are the penalties under SB1352?

SB1352 establishes the following penalties: administrative penalty of Capped at the lesser of: (1) 10% of the tax savings (difference between tax with and without exemption/allocation); or (2) 10% of the actual tax imposed with the exemption/allocation. for Late filing of application for Freeport Goods Exemption (Section 11.251) or Interstate Allocation (Section 21.09).. Consult with legal counsel for specific applicability to your situation.

Q

Which Texas businesses are affected by SB1352?

SB1352 primarily affects property owners and real estate professionals. These businesses should review the legislation with their legal and compliance teams to understand potential impacts.

Need Strategic Guidance on This Legislation?

JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.

Legislative data provided by LegiScanLast updated: January 11, 2026