Immigration, AI, and property taxes lead new changes in Texas law
By David Taylor / Managing Editor
As the sun rose on January 1, 2026, Texans woke up to a slate of 33 new laws reshaping everything from immigration enforcement to artificial intelligence and property taxes. Passed during the 89th Legislative Session, these measures are poised to impact residents and businesses statewide.
Some laws have minor changes while others cleanup existing laws. Lawmakers seemed to target taxes, AI, and immigration.
Immigration Enforcement Tightens
One of the most significant changes is Senate Bill 8, which requires sheriffs in counties operating jails to formally cooperate with U.S. Immigration and Customs Enforcement under the federal 287(g) program. Supporters say the law will improve public safety, while critics warn of increased racial profiling and overpolicing.
Counties participating in the program can apply for state grants ranging from $80,000 to $140,000 to help cover costs. However, groups like the ACLU argue the program won’t fully cover the associated expenses.
AI Regulation Arrives
Texas is also stepping into the future with House Bill 149, the Texas Responsible Artificial Intelligence Governance Act. The law establishes a state framework for AI, bans certain uses—including AI-driven pornography bots and impersonation of minors—and creates the Texas Artificial Intelligence Council to study the impact of regulation.
The law also prohibits AI systems that could encourage self-harm, criminal activity, discrimination, or unauthorized biometric surveillance, giving the Texas Attorney General enforcement authority.
Property Tax Relief and Housing Changes
Homeowners and businesses will see notable tax changes. House Bill 9 raises the business inventory tax exemption from $2,500 to $125,000, a move hailed as a win for Texas businesses but expected to reduce local tax revenues by about $442 million in fiscal year 2027.
Homestead exemptions are also increasing, with up to $200,000 for those who are disabled or 65 and over. Livestock feed and border-security infrastructure built on private property are now tax exempt. Additionally, new laws limit how cities can raise taxes after natural disasters, requiring the governor’s approval—a direct response to Houston’s tax hike after Hurricane Beryl.
Senate Bill 38 targets squatters, streamlining eviction procedures and allowing justice courts to schedule hearings within 10 to 21 days. The law restricts courts to ruling strictly on unlawful occupation, tightening notice requirements and enabling summary judgments in clear cases.
“These are commonsense reforms to keep bad things [from] happening to people’s homes, and more importantly, to keep people out of property they don’t own and they don’t have any legitimate right to through a lease,” according to bill sponsor Sen. Paul Bettencourt, R-Houston in an interview.
However, housing advocates warn the changes could reduce protections for tenants and increase the risk of wrongful evictions.
Digital and Insurance Reforms
Other notable laws include requirements for app stores to verify age and obtain parental consent for minors (though enforcement is currently paused by a federal judge), new insurance transparency rules, and simplified unemployment claims.
As Texas steps into 2026, residents and businesses alike will be navigating a new legal landscape—one shaped by lawmakers’ push for safety, innovation, and economic relief.
Below is the full list of the 33 pieces of legislation now in effect as of January 1, 2026:
HB 22 — Exempts intangible personal property from property (ad valorem) taxes.
HB 30 — Limits how taxing entities calculate tax rates and raise taxes following a declared disaster.
HB 149 — Regulates the use of artificial intelligence in Texas and allows civil penalties for violations.
HB 851 — Changes how residence homesteads receiving tax benefits are counted and reported.
HB 1244 — Allows land to keep its open-space tax appraisal after ownership transfers if use stays the same.
HB 1392 — Extends tax payment deadlines if a tax office is closed on the delinquency date.
HB 2067 — Addresses when insurance policies may be declined, canceled, or not renewed.
HB 2525 — Exempts certain senior housing owned by charitable organizations from property taxes.
HB 2723 — Requires an application for property tax exemptions on land used for human burial.
HB 2742 — Allows property owners to split property tax payments into installments.
HB 3159 — Creates a severance tax exemption for oil and gas from certain restimulated wells.
HB 3370 — Allows late timber land tax appraisal applications after a landowner’s death.
HB 3424 — Changes how dealer-owned heavy equipment inventory is taxed.
HB 3699 — Modifies how initial unemployment compensation claims are handled.
HB 4395 — Allows electronic filing and delivery of public securities and related records.
HB 4738 — Eliminates the requirement to send a portion of certain loan fees to the state comptroller.
HB 4739 — Ends the requirement to remit part of retail charge delinquency fees to the comptroller.
HB 5654 — Creates Montgomery County Municipal Utility District No. 263 with taxing and bonding authority.
SB 8 — Requires certain sheriffs to partner with ICE for immigration enforcement and creates state grants.
SB 1023 — Changes how certain property tax rates are calculated.
SB 1058 — Excludes certain securities transaction payments from taxable revenue.
SB 1106 — Requires public improvement district plans and assessments to be posted online.
SB 1453 — Revises how taxing units calculate debt and property tax rates.
SB 1455 — Changes how workers’ compensation regulation is funded, including new surcharges.
SB 1502 — Allows school boards to adopt tax rates above voter-approved limits under certain conditions.
SB 1522 — Updates regulations for continuing care retirement facilities.
SB 1951 — Imposes penalties for failing to timely file required property tax reports.
SB 1968 — Updates licensing and regulation of certain real estate professionals.
SB 2206 — Creates tax credits and sales tax changes for research and development expenses.
SB 2420 — Regulates mobile app marketplaces, including age verification and parental consent.
SB 2520 — Adjusts school property tax limits for elderly and disabled homeowners.
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