From TEA : The New to Texas indicator is only for students who have not been in a Texas school (i.e. they have not lived in Texas) prior to testing with you. If a student was in Texas, leaves the state and comes back to a Texas school at a later date, those students are not considered New to Texas.
From TAA : House Bill 2349 requires a school district or charter school that administers a STAAR test to report to the agency whether an assessed student transferred into the school or district from out of state during the current school year.
From Student Assessment : The only consideration is whether you are enrolling a student from out of Texas, not the history of the student in Texas. If they were attending a private or home school within the state of Texas, they would not be marked.
From the above, any student that was previously in a Texas school would not be marked as a New to Texas student. Only students who are coming to a Texas school for the first time this year are to be flagged.
Enter state enrollment date under: Registration > Entry & Reports > Student Demographic > Registration