Indiana Property Tax 2026: Circuit Breaker 1-2-3 Caps, Homestead & New Credits

Indiana's property tax is shaped by two structural rules: the Constitutional 1-2-3 circuit breaker caps (homestead tax max 1% of value, rental 2%, commercial 3%) and a layered stack of deductions and credits. Major 2026 changes include a new $150 over-65 credit (replacing the old over-65 deduction) and a brand-new automatic 10 percent homestead credit up to $300. This guide explains how it all fits together.

How Indiana Property Tax Works

Indiana property tax is administered by 92 county assessors and county auditors, with oversight from the Indiana Department of Local Government Finance (DLGF). Taxes are billed a year in arrears — your 2026 tax bill covers the 2025 assessment year.

The tax calculation

The assessment calendar

• March 1 — assessment date (values are set as of this date)
• April-May — Notice of Assessment (Form 11) mailed by county assessor
• June 15 — deadline to file most deductions for the following year's bill
• July 15 of year following assessment — appeal deadline with county Property Tax Assessment Board of Appeals (PTABOA)
• Spring of following year — tax bills issued in two installments

The 1-2-3 Circuit Breaker Caps

Indiana's Constitution (Article 10 §1, added by 2010 amendment) caps property tax at a percentage of gross assessed value:

• 1% (homestead): owner-occupied primary residence — tax cannot exceed 1% of gross assessed value
• 2% (other residential and agricultural): rental residential, long-term care, and agricultural land
• 3% (non-residential and long-term care): commercial, industrial, vacant, and other

Why it matters

The caps are constitutional — they cannot be overridden by local tax rate increases or voter-approved levies. If the combined local rate implies a homestead tax above 1%, the excess is simply not collected. This is one of the strongest constitutional tax caps in the country.

Deductions (Off Assessed Value)

Standard Homestead Deduction

$48,000 subtracted from gross assessed value for owner-occupied primary residences. File with the county auditor by December 31 of the assessment year (with automatic retention in subsequent years). New in 2026: deduction applied on top of the new 10% homestead credit.

Supplemental Homestead Deduction

After the Standard Homestead Deduction, the Supplemental Deduction removes an additional 40% of remaining homestead assessed value (up to certain caps). This stacks with the Standard Deduction.

Mortgage Deduction (eliminated 2023)

Indiana's Mortgage Deduction was repealed effective 2023. Homeowners no longer receive this $3,000 deduction.

Over-65 Deduction converted to $150 Credit

The former Over-65 Deduction was replaced with a $150 credit applied directly to the 2026 tax bill. Eligibility expanded:

• Age 65+ homeowner
• Adjusted gross income limit: $60,000 single / $70,000 joint (up from prior limit)
• Applied as a direct bill credit, not an assessed value deduction

Disabled Veteran Deduction

$14,000 deduction for disabled veterans (or surviving spouses) with certain service-connected disability. $24,960 deduction for totally disabled (100%) veterans. Plus mortgage and tax deductions based on income.

New 2026 Credits and the Over-65 Circuit Breaker

Automatic 10% Homestead Credit (NEW 2026)

Starting tax year 2026, all qualifying homesteads receive an automatic 10% credit on the property tax bill, up to a maximum of $300. Applied automatically by the county auditor — no application needed.

Over-65 Circuit Breaker Credit

This is separate from the 1% circuit breaker. For qualifying seniors, the Over-65 Circuit Breaker caps annual property tax increase at 2% per year. Eligibility is stricter:

• Age 65+ homeowner
• Income cap: $30,000 single / $40,000 joint
• Homestead assessed value under $200,000
• Owned and occupied at least one year

This is one of the most restrictive senior benefits in the country on income, but provides permanent protection from large tax increases once qualified.

Disabled Veteran Credit

Separate from the deduction, some Indiana counties offer additional credits for 100% service-connected disabled veterans.

Appealing Your Assessment

Indiana's appeal process runs through PTABOA to the Indiana Board of Tax Review (IBTR).

Step 1: Informal conference with assessor

Contact the county assessor after receiving the Notice of Assessment. Many issues resolve informally.

Step 2: PTABOA (Property Tax Assessment Board of Appeals)

File Form 130 with the county PTABOA by June 15 of the year in which the assessment is made. In some situations the deadline extends to 45 days after the Notice of Assessment. Hearings are informal, 60-120 days later.

Step 3: Indiana Board of Tax Review (IBTR)

Appeal PTABOA decision to IBTR within 45 days using Form 131. More formal procedure; evidence-based hearings.

Step 4: Indiana Tax Court

IBTR decisions appealable to Indiana Tax Court within 45 days. Court of Appeals review also available for legal errors.

Payment Schedule

Indiana property tax for a year is paid the following year in two equal installments:

• First installment (spring): due May 10
• Second installment (fall): due November 10

Delinquent tax accrues 5% penalty for first 30 days, 10% after that, plus 10% annual interest. After delinquency exceeds two years, the county treasurer conducts a tax sale of tax liens. Homeowners have a 12-month redemption period.

Frequently Asked Questions

What are Indiana's property tax caps?

Indiana's Constitutional 1-2-3 circuit breaker caps limit property tax to: 1% of gross assessed value for homesteads (owner-occupied primary residence), 2% for rental residential and agricultural property, 3% for all other real property (commercial, industrial, vacant). These are absolute caps — actual tax cannot exceed these percentages regardless of local rates.

What is Indiana's 10% homestead credit in 2026?

A new automatic 10% property tax credit on the primary residence tax bill, up to a maximum of $300. Applied by the county auditor without application. Launched for tax year 2026 and stacks on top of the existing Standard ($48,000) and Supplemental (40%) Homestead Deductions.

Who qualifies for the Indiana over-65 circuit breaker credit?

Homeowners age 65+ with adjusted gross income under $30,000 (single) or $40,000 (joint), whose homestead is valued at less than $200,000, and who have owned and occupied the property for at least one year. This credit caps annual property tax increase at 2% per year — providing permanent protection once qualified. Separate from the $150 over-65 credit (which has higher income limits of $60,000/$70,000).

When is the Indiana property tax appeal deadline?

File Form 130 with the county Property Tax Assessment Board of Appeals (PTABOA) by June 15 of the assessment year, or 45 days after the Notice of Assessment in some situations. If dissatisfied, appeal to Indiana Board of Tax Review (IBTR) within 45 days using Form 131, then to Indiana Tax Court.

How much is Indiana's homestead deduction in 2026?

The Standard Homestead Deduction is $48,000 off assessed value, plus the Supplemental Homestead Deduction of 40% of the remaining value. For a $200,000 home: $200,000 − $48,000 = $152,000, minus 40% ($60,800) = $91,200 taxable value. Add the new 10% credit (up to $300) and the circuit breaker caps for total relief.