Penalty for failure to notify when property no longer qualifies for homestead exemption

• A. Being subject to the taxes exempted, plus 15% interest, and a penalty of 50% of the taxes exempted
• B. A civil penalty of $100
• C. A 1st degree misdemeanor (up to $5,000)
• D. $500

Answer: (D)

When you have a homestead exemption, you must tell the property appraiser if the property no longer qualifies (for example, if you move, rent it, or stop using it as your primary residence). If you fail to notify, the law imposes a civil penalty to deter this noncompliance, capped at five hundred dollars. This penalty is designed to recover the administrative costs of correcting records and to ensure timely reporting; it’s an administrative remedy rather than a criminal sanction. The other options describe different penalties that aren’t used for this specific violation—there isn’t a fixed $100 civil penalty or a misdemeanor for simply not notifying, and the penalty isn’t calculated as a percentage of the taxes exempted.