An appraised value limitation is an agreement in which a taxpayer agrees to build or install property and create jobs in exchange for an eight year limitation on the taxable property value for school district maintenance and operations tax (M&O) purposes. The minimum limitation varies by school district. The application for a limitation on the appraised value for M&O purposes is submitted directly to the school district and may require an application fee, which is established by each school district. View application forms #50-296 and # 50-300 for School Districts-Economic Development Act.
To qualify for a tax credit, a separate application must be submitted before September 1 of the third year of a ten year period. The credit is for the M&O taxes paid over the limitation amount in the first two years. The school districts tax collector must credit the overage in equal parts over the last seven years of the agreement, but the credit may not exceed 50 percent of the total taxes paid on the qualified property for a given year. Any eligible amount not credited in the seven year period must be credited over the next three years, but not to exceed the total taxes paid on the qualified property.