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Signed Into Law
Signed June 20, 2025Effective 2026-01-01
SB1951

Regular Session

Relating to the imposition of a penalty for failure to timely file a rendition statement or property report with the chief appraiser of an appraisal district.

Government Affairs & Regulatory Compliance Analysis

SB1951: Government Affairs Overview

SB1951 mandates strict transparency and notification protocols for the 10% penalty associated with failure to file Business Personal Property (BPP) renditions. The law forces Chief Appraisers to issue penalty notices by June 1 and requires Tax Assessors to list penalties as a separate line item on tax bills, effectively eliminating the ability for penalties to be hidden within aggregate tax totals. This impacts all entities owning tangible business personal property, particularly those with multi-location footprints or NNN lease structures.

Sen. Angela Paxton·Senate Bill·Regular Session

Moderate
Low Cost
Effective:2026-01-01
Enforcing Agencies

Chief Appraiser (County Appraisal Districts) • Tax Assessor-Collectors

Business Impact

Who SB1951 Affects

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

Regulatory Priority: moderate

Notable regulatory updates (effective 2026-01-01). Consider how these changes may affect your operations.

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Real Estate

Affected business types:

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

Key Operational Considerations

  • 1NNN Leases (Landlords): Ensure "Operating Expenses" definitions are broad enough to capture penalties if the tenant is contractually responsible for the filing but fails to perform.
  • 2Tax Consultant MSAs: Update indemnity clauses. If a third-party vendor misses a filing, they must be liable for the 10% penalty, which will now be irrefutably documented on the tax bill.
  • 3Accounts Payable: Train AP staff to review tax bills for the specific "Penalty" line item. Do not auto-pay bills containing this line item without Legal/Tax review.

Estimated Cost Impact

lowMinimal cost impact anticipated.

Enforcing Agencies

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SB1951
Moderate
Relating to the imposition of a penalty for failure to timely file a rendition statement or property report with the chief appraiser of an appraisal d...
Moderate Compliance Urgency
Requires near-term attention
Cost Impact
Low
Effective
2026-01-01
Enforcing Agencies
Chief AppraiserTax Assessor-Collectors
Primary Author: Sen. Angela Paxton
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: January 1, 2026
  • Compliance Deadline: April 15, 2026 (Deadline to file renditions to avoid the automated penalty cycle).
  • Agency Rulemaking: While no new agency rules are mandated, the Comptroller may update model forms prior to the 2026 tax year. Monitor the Comptroller’s Property Tax Assistance Division for updated Rendition Penalty Notice templates in late 2025.

Immediate Action Plan

  • 1. Audit Lease Agreements: Review all NNN leases before the 2026 tax year to clarify liability for administrative tax penalties.
  • 2. Update AP Software: Configure ERP/Accounting systems to require a manual check if a property tax bill exceeds the prior year's amount by 10% or more.
  • 3. Establish "June 1" Watchlist: Calendar a compliance check for the first week of June 2026 to verify receipt (or non-receipt) of penalty notices.
  • 4. Verify Asset Rolls: For any notice received via Certified Mail, immediately cross-reference asset lists to determine if a location was erroneously dropped from the rolls in the prior year.

Operational Changes Required

Contracts

  • NNN Leases (Tenants): Amend lease terms to explicitly exclude reimbursement for "penalties resulting from Landlord’s failure to timely render." You must not pay for the landlord's administrative errors now that they are line-itemized.
  • NNN Leases (Landlords): Ensure "Operating Expenses" definitions are broad enough to capture penalties if the tenant is contractually responsible for the filing but fails to perform.
  • Tax Consultant MSAs: Update indemnity clauses. If a third-party vendor misses a filing, they must be liable for the 10% penalty, which will now be irrefutably documented on the tax bill.

Hiring/Training

  • Accounts Payable: Train AP staff to review tax bills for the specific "Penalty" line item. Do not auto-pay bills containing this line item without Legal/Tax review.
  • Mailroom Protocols: Staff must be trained to flag Certified Mail from Appraisal Districts received between May 15 and June 5. This specific mail class indicates the property was omitted from the prior year's roll, signaling a high-risk audit scenario.

Reporting & Record-Keeping

  • Proof of Filing: Maintain digital logs or certified mail receipts for all April rendition filings. The automated June 1 notice requirement removes informal leniency; you will need documented proof of timely filing to contest a penalty.

Fees & Costs

  • Penalty Structure: 10% of the total tax liability for the year.
  • Budget Impact: While the penalty amount is unchanged, the likelihood of assessment is higher due to automated notification requirements.

Strategic Ambiguities & Considerations

  • The "June 1" vs. "Value Notice" Conflict: The statute requires the penalty notice be delivered "with the notice of appraised value" by June 1. However, Appraisal Districts frequently delay value notices past June 1.
  • *Business Logic:* If a penalty notice arrives *after* June 1, Legal Counsel should protest the penalty on procedural grounds, arguing the Chief Appraiser failed to meet the statutory deadline, rendering the penalty invalid.
  • Enforcement Incentives: The bill removes the 5% revenue share previously kept by Appraisal Districts. With no financial incentive to collect the penalty, Appraisal Districts may become administratively lax, but Taxing Units (who now keep 100% of the penalty) will likely exert political pressure for maximum enforcement.

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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.

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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
Mar 5, 2025
Passed Senate
Apr 22, 2025
Passed House
May 20, 2025
Signed
Jun 20, 2025
Effective
Jan 1, 2026
TopicsTaxationTaxation--property-appraisals & Appraisal Districts
03

Senate Authors

Sen. Angela PaxtonRepublican · Primary Author

House Sponsor

Rep. Angie ButtonRepublican · Primary Sponsor

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

Related Legislation

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More from Sen. Angela Paxton

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Related by Topic

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Quick Reference

Frequently Asked Questions

Common questions about SB1951

Q

What does Texas SB1951 do?

SB1951 mandates strict transparency and notification protocols for the 10% penalty associated with failure to file Business Personal Property (BPP) renditions. The law forces Chief Appraisers to issue penalty notices by June 1 and requires Tax Assessors to list penalties as a separate line item on tax bills, effectively eliminating the ability for penalties to be hidden within aggregate tax totals. This impacts all entities owning tangible business personal property, particularly those with multi-location footprints or NNN lease structures.

Q

Who authored SB1951?

SB1951 was authored by Texas Senator Angela Paxton during the Regular Session.

Q

When was SB1951 signed into law?

SB1951 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce SB1951?

SB1951 is enforced by Chief Appraiser (County Appraisal Districts) and Tax Assessor-Collectors.

Q

How significant are the changes in SB1951?

The regulatory priority for SB1951 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of SB1951?

The cost impact of SB1951 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does SB1951 address?

SB1951 addresses topics including taxation and taxation--property-appraisals & appraisal districts.

Q

What are the key dates for SB1951?

Key dates for SB1951: Effective date is 2026-01-01. Consult with legal counsel regarding applicability.

Q

What are the penalties under SB1951?

SB1951 establishes the following penalties: Administrative (Ad Valorem Tax) penalty of 10% of the total amount of taxes imposed on the property for the year for Failure to timely file a rendition statement or property report (Existing penalty; bill mandates stricter notice and itemization requirements). Consult with legal counsel for specific applicability to your situation.

Q

Which Texas businesses are affected by SB1951?

SB1951 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