Key Takeaways
- A new credit takes 10% off your homestead bill, up to $300. It equals the lesser of 10% of the liability or $300, it applies to taxes first due and payable after December 31, 2025, and no application is required (IC 6-1.1-20.6-7.7; Indiana DLGF, June 2025).
- Homeowners 65 and older can claim another $150, but only by applying. The old Over 65 Deduction was repealed and replaced with a $150 Over 65 Credit, filed with the county auditor by January 15 (IC 6-1.1-51.3-1; Indiana DLGF, June 2025).
- The 2026 bill is the good year. The $48,000 standard homestead deduction is still whole on the 2025 assessment date, and the supplemental deduction rose to 40%. The phase-down of the standard deduction starts with the 2026 assessment date, which hits 2027 bills (IC 6-1.1-12-37).
- This is not a uniform win, and the split is by house value. A flat $48,000 deduction is worth proportionally far more on a cheap house than a percentage deduction is. Purdue's Larry DeBoer put the break-even value at $102,740 and found owners of low-value houses could face double-digit percentage increases as the swap phases in (Indiana Capital Chronicle, November 2025).
- Indiana caps the bill, not the rate. A homestead bill cannot exceed 1% of gross assessed value, other residential and farmland 2%, and other property 3% (Indiana Constitution Article 10, Section 1; IC 6-1.1-20.6).
- The appeal deadline is not a flat 45 days. It is June 15 of the assessment year if the county mailed your Form 11 before May 1, and June 15 of the year the tax bill is mailed if the Form 11 went out on or after May 1 (IC 6-1.1-15-1.1(b)(2); Indiana DLGF, February 2026).
Indiana property tax changes in 2026 all trace back to one law. Senate Enrolled Act 1, signed by Governor Mike Braun on April 15, 2025, is the largest rework of Indiana property tax in more than a decade, and the bills payable this year are the first ones it touches (Indiana Department of Local Government Finance, June 2025).
Most coverage of it has been either a victory lap or a complaint, which is not much use if you are holding the bill. What follows is what the law does to your number, in what order, and which parts of it help you only if you file something. It also covers the part almost nobody says out loud: the way the relief is built, owners of the cheapest houses in Indiana can end up worse off than they were.
Indiana bills a year behind: the January 1, 2025 assessment date drives taxes payable in 2026, and county treasurers mailed those bills by April 15, 2026, with installments due May 11 and November 10, 2026 (IC 6-1.1-22-8.1(c); IC 6-1.1-22-9; Indiana DLGF, February 2026). Constitutional circuit breaker caps limit a homestead bill to 1% of gross assessed value, other residential and farmland to 2%, and other property to 3% (Indiana Constitution Article 10, Section 1; IC 6-1.1-20.6). New for 2026 bills: a supplemental homestead credit of 10% up to $300 (IC 6-1.1-20.6-7.7), a supplemental homestead deduction of 40% (IC 6-1.1-12-37.5), and a maximum levy growth quotient held to 1.04 (IC 6-1.1-18.5-2). Statewide, Indiana's typical house value was $262,265 in June 2026, up about 3.0% year over year (Zillow Home Value Index for Indiana, via the Federal Reserve Bank of St. Louis, June 2026).
What the Indiana property tax changes in 2026 actually do
Senate Enrolled Act 1 does four things to a homeowner's bill: it adds a new credit, it raises one deduction, it starts shrinking another, and it holds down how fast local levies can grow. Everything else in the law, and it is a long law, sits behind those four levers.
The credit is the piece you feel first, because it comes off the bottom of the bill rather than off the assessed value at the top. Purdue Extension describes it plainly: a credit is a subtraction from the tax bill after the tax rate is applied, and this one is 10 percent of the bill up to a maximum of $300, applied after the caps (Purdue Extension, September 2025). An owner already sitting at the 1% cap still gets it.
| SEA 1 change | What it does | When it phases in | Statute |
|---|---|---|---|
| Supplemental homestead credit | Cuts the homestead bill by the lesser of 10% or $300. Referendum taxes are excluded from the calculation. Automatic. | Taxes payable in 2026, then every year after | IC 6-1.1-20.6-7.7 |
| Over 65 Credit | Replaces the repealed Over 65 Deduction with a credit of up to $150. Income limits of $60,000 single and $70,000 joint. Application required. | Taxes payable in 2026, retroactive to the 2025 assessment date | IC 6-1.1-51.3-1 |
| Standard homestead deduction phase-out | Steps the flat deduction down from $48,000 to $0 over five assessment dates | Still $48,000 on 2026 bills. Falls to $40,000 on 2027 bills and reaches $0 on 2031 bills | IC 6-1.1-12-37 |
| Supplemental homestead deduction increase | Raises the percentage deduction taken after the standard deduction, capped at 75% of gross assessed value | 37.5% to 40% on 2026 bills, rising to 66.7% on 2031 bills | IC 6-1.1-12-37.5 |
| New deduction for 2%-cap property | Automatic deduction for non-homestead residential property, long term care property, and farmland | 6% of assessed value on 2026 bills, rising to 33.4% on 2031 bills | IC 6-1.1-12-47 |
| Maximum levy growth quotient | Limits how fast local units can grow their property tax levies | Held at 1.04, a 4% ceiling, for taxes payable in 2026 | IC 6-1.1-18.5-2 |
Every figure in that table comes from the Department of Local Government Finance's own June 2025 guidance to county assessors and auditors, which reproduces the amended statutory text section by section (Indiana DLGF, June 2025). SEA 1 also directed the state to build a property tax transparency portal so taxpayers can compare a current bill against proposed rate changes (Indiana Senate Republicans, April 2025). The DLGF now runs that portal on Indiana Gateway, with a tax bill estimator covering pay-2026 deductions and credits, built with the Indiana Business Research Center at Indiana University (Indiana Gateway, DLGF, July 2026).
Will my Indiana property tax bill go down in 2026?
For most Indiana homesteads, yes, because every SEA 1 lever that moves in 2026 moves in the homeowner's favor and none of the offsetting cuts have started yet. On the January 1, 2025 assessment date that drives your 2026 bill, the standard homestead deduction is still the full $48,000, the supplemental homestead deduction went up from 37.5% to 40%, and the 10% credit is brand new (Indiana DLGF, June 2025).
The legislature's own projection was that roughly two-thirds of Hoosier homeowners would see a lower bill in 2026 than in 2025, with about $1.3 billion in homeowner relief over three years (Indiana Senate Republicans, April 2025). Treat that as the bill author's estimate rather than an independent finding, because it is one.
Three things can still push your 2026 bill up anyway. Your assessed value may have risen enough to swamp the relief. Your community may have passed a referendum levy, and referendum taxes are specifically excluded from the 10% credit calculation (IC 6-1.1-20.6-7.7). And if you previously claimed the Over 65 Deduction, that deduction was repealed as of the January 1, 2025 assessment date and replaced by a credit you may have to apply for (Indiana DLGF, June 2025). A senior who never filed the new application can lose more than the new credit gives back.
The Indiana homestead credit and the deductions behind it
The Indiana homestead credit added by SEA 1 is formally the supplemental homestead credit at IC 6-1.1-20.6-7.7, and it equals the lesser of 10% of the homestead's property tax liability for the year or $300. It applies for property taxes first due and payable in calendar years beginning after December 31, 2025. You do not file for it. The statute directs the county auditor to identify eligible property and apply the credit (Indiana DLGF, June 2025).
The one thing you do have to do is keep the standard homestead deduction on file, because the credit only reaches a person who qualifies for that deduction. If you bought recently, moved your principal residence, or lost the deduction after a title change, the credit goes with it. Homestead applications are filed with the county auditor, and one filed on or before January 15 is reflected on that year's bill (Indiana DLGF, July 2026).
The benefits that are not automatic
Three of the most valuable Indiana benefits require paperwork, and SEA 1 changed all three. The Over 65 Credit at IC 6-1.1-51.3-1 is worth up to $150, requires that you turned 65 on or before December 31 of the preceding year, and carries an income test of $60,000 for a single filer or $70,000 joint, measured on the federal adjusted gross income from two years before the taxes are payable. You must have owned the property for at least a year, and the application goes to the county auditor on or before January 15 (Indiana DLGF, June 2025).
The Blind/Disabled Credit at IC 6-1.1-51.3-2 is worth up to $125, has no income limit at all, and shares the January 15 filing deadline. Separately, the Over 65 Circuit Breaker Credit at IC 6-1.1-20.6-8.5 got materially easier to qualify for: SEA 1 raised its income ceilings to $60,000 and $70,000 from $30,000 and $40,000, and removed the $240,000 assessed value limit entirely. A senior in a house worth more than $240,000 who was disqualified in past years may now be eligible (Indiana DLGF, June 2025).
The phase-in schedule, year by year
Indiana is trading a flat dollar deduction for a percentage one over five years, and the table below is the whole trade in one place. Read the first two columns together, because they move in opposite directions on purpose.
| Taxes payable | Standard homestead deduction | Supplemental homestead deduction | 2%-cap property deduction |
|---|---|---|---|
| 2026 | $48,000 | 40% | 6% |
| 2027 | $40,000 | 46% | 12% |
| 2028 | $30,000 | 52% | 19% |
| 2029 | $20,000 | 57% | 25% |
| 2030 | $10,000 | 62% | 30% |
| 2031 and after | $0 | 66.7% | 33.4% |
Sources: IC 6-1.1-12-37, IC 6-1.1-12-37.5, and IC 6-1.1-12-47 as amended and added by SEA 1 (Indiana DLGF, June 2025). The statutes are written by assessment date; the years above are the payable years those assessment dates produce, since Indiana bills one year in arrears. The supplemental homestead deduction can never exceed 75% of gross assessed value, and the 2%-cap deduction requires no application at all.
How Indiana's property tax caps work
Indiana caps the tax bill itself rather than the tax rate, which is the single most misunderstood feature of the system. A property owner does not pay more than 1% of gross assessed value on a homestead, 2% on other residential property and agricultural land, and 3% on other real and personal property, and the caps do not change the local tax rate (Indiana DLGF). The limits sit in Article 10, Section 1 of the Indiana Constitution, added by voter referendum, and are administered under IC 6-1.1-20.6.
In practice a $250,000 Indiana homestead cannot be billed more than $2,500 in property tax for the year, whatever the combined rate of the school, county, township, city, and library levies works out to. The gap between what the rate would have produced and what the cap allows shows up on your bill as a circuit breaker credit.
What matters for planning is what happens once you hit the cap. At the ceiling, further growth in your assessed value stops raising your bill, because the levy is already exceeding what the cap permits. Two owners in the same neighborhood can get identical percentage value increases and see completely different outcomes depending on whether they were capped before. The reverse also holds: at the cap, appealing your value down only helps once the reduction pulls the capped amount below what the rate would have charged.
Published effective property tax rates for Indiana counties vary widely between third-party sources, and the numbers that circulate online are frequently stale, statewide averages relabeled as county figures, or calculated before the SEA 1 credits existed. Rather than print a rate that may not describe your parcel, we are pointing you to the source that governs. Look up your actual district rate, deductions, and credits through the Indiana DLGF and your county auditor, and use the DLGF tax bill estimator on Indiana Gateway to model your own number.
Who gains and who loses under Senate Enrolled Act 1
SEA 1 helps expensive houses more than cheap ones, and as the phase-in advances, owners of the least valuable houses in Indiana can end up paying more than they would have under the old rules. That is a direct consequence of the design, not a side effect. Replacing a flat dollar deduction with a percentage deduction moves relief up the value scale.
The arithmetic is easy to see. A flat $48,000 comes off every homestead equally, so on an $80,000 house it wipes out 60% of the assessed value before the supplemental deduction even starts. On a $400,000 house the same $48,000 is 12%. A percentage deduction does the opposite: 66.7% is 66.7% whether the house is worth $80,000 or $800,000, which means the dollars of relief scale with the price of the house.
Larry DeBoer, emeritus professor of agricultural economics at Purdue University, ran the numbers for the Indiana Fiscal Policy Institute and found the break-even point, where the old and new policies produce the same taxable value, at a house worth $102,740. Below that line the swap is a net loss, above it a net gain, and owners of low-value houses could face double-digit percentage increases (Indiana Capital Chronicle, November 2025; Purdue Extension, September 2025).
Two qualifiers keep this honest in both directions. First, timing: none of the loss lands on the 2026 bill, because the standard deduction is still whole at $48,000 on the assessment date behind it. The redistribution begins with 2027 bills and deepens each year through 2031. Second, the $300 cap on the new credit works the opposite way from the deduction swap, since a capped dollar credit is proportionally worth more against a small bill than a large one. It softens the effect at the bottom without reversing it.
The plain-language version: if your Indiana house is worth well over about $103,000, this law is a tax cut for you that grows each year. If it is worth well under that, you get a cut in 2026 and then start giving it back, and by the end of the phase-in you may pay more than you do today. Typical Indiana house value was $262,265 in June 2026 (Zillow Home Value Index for Indiana, via the Federal Reserve Bank of St. Louis, June 2026), so most Hoosier homeowners land on the winning side of that line. The households on the other side of it are, by definition, the ones with the least room to absorb an increase.
How to appeal your Indiana property assessment
You appeal an Indiana assessment by filing Form 130, the Taxpayer's Notice to Initiate an Appeal, with your local assessing official, and it costs nothing to file. The assessor holds an informal conference and makes a recommendation. If the appeal is denied, it moves to the county Property Tax Assessment Board of Appeals, and from there to the Indiana Board of Tax Review (Indiana DLGF).
The deadline is the part most guides get wrong, so read this next paragraph carefully rather than trusting a date you saw elsewhere.
Indiana ties the deadline to when your county mailed the Form 11 Notice of Assessment. If the county mailed the Form 11 before May 1 of the assessment year, the appeal is due June 15 of that same assessment year. If the county mailed it on or after May 1, the deadline moves to June 15 of the year in which the county treasurer mails the tax bill (IC 6-1.1-15-1.1(b)(2); Indiana DLGF, February 2026). Guides that quote a flat 45-day window running from the Form 11 date are describing an older rule the statute no longer uses.
Because the trigger is your county's mailing date, the operative deadline genuinely differs between counties in the same year, and the DLGF publishes a county-by-county list of Form 11 mail dates with the appeal deadline for each. Counties that mailed early in 2026 closed on June 15, 2026. Counties that mailed on or after May 1, and counties that mailed no Form 11 at all, run to June 15, 2027. Ask your county assessor for your parcel's date rather than assuming.
What actually wins an Indiana appeal
Indiana assesses at market value in use, so the argument that works is evidence that your parcel would not sell for what the assessor says it is worth. Recent arm's length sales of genuinely comparable houses in your neighborhood are the strongest material. A recent appraisal is strong. Contractor estimates for a failing roof, foundation, or mechanical system are strong, because they go to condition the assessor could not see from the street.
Errors on the property record card are the easiest wins and the most commonly missed. Pull yours from the assessor's office and check the square footage, the bedroom and bathroom count, the finished basement flag, the garage, and whether a structure that no longer exists is still on the card. Those corrections do not require an opinion of value, only a fact.
What does not work is arguing that the bill is unaffordable, that the percentage increase was unfair, or that the neighbors pay less. The appeal is about the value of your parcel, and only that.
Your options if the 2026 bill is more than you can carry
An Indiana homeowner stretched by the 2026 bill has four realistic moves, and three of them keep the house. Work the list in order, because the free ones come first and the irreversible one comes last.
| Option | What it involves | Where you do it | Best suited to |
|---|---|---|---|
| Claim every deduction and credit | Confirm the homestead deduction is on file, then apply for the Over 65 Credit, Blind/Disabled Credit, Over 65 Circuit Breaker Credit, or veteran deductions if eligible. January 15 deadline. | County auditor | Everyone. This is free, fast, and the most commonly left on the table. |
| Appeal the assessed value | File Form 130 with the assessing official. Free. Deadline turns on your county's Form 11 mail date (IC 6-1.1-15-1.1(b)(2)). | County assessor, then PTABOA | Owners with comparable sales, an appraisal, condition problems, or a wrong record card |
| Ask about payment arrangements | Indiana bills in two installments, due May 11 and November 10 in 2026 (IC 6-1.1-22-9). Some counties accept prepayments or partial payments on arrears. | County treasurer | Owners who can carry the house going forward but not clear a lump sum |
| Sell | List with an agent, or sell as-is for cash. Taxes owed come out of proceeds at closing and the lien is released. | Open market, or a direct buyer | Owners for whom the house is structurally unaffordable, not temporarily tight |
One thing that is not on the list is waiting. Indiana counties run an annual tax sale on delinquent parcels, and an owner with real equity can lose it over a comparatively small tax debt. Our guide to the Indiana county tax sale and redemption period covers that timeline in full.
Selling an Indiana house you can no longer carry
Selling is the right answer only when the gap between the bill and your budget is structural rather than a bad year, and most people reading this are not there. If an appeal, a missed credit, or a payment arrangement closes the gap, take that route and keep the house. It is cheaper than a sale in every way that matters.
Where a sale genuinely is the answer, timing drives the decision. Indiana's statewide market is drifting toward balance rather than heating up, with typical house values up about 3.0% year over year as of June 2026 (Zillow Home Value Index for Indiana, via the Federal Reserve Bank of St. Louis, June 2026). A listed sale in that market takes months, and months are what a homeowner carrying an unaffordable bill has least of.
Propcash is a direct cash homebuyer. We buy houses across Indiana with our own funds, in any condition, and cash transactions can close in as few as 7 days. There are no agent commissions, no closing costs charged to you, and no fees. Propcash is 100% free for sellers, with no repairs, no cleaning, and no cleanout. Our offers are based on local market data, and we will show you how we got to our number.
We will also tell you when a cash sale is not your best move. If the house shows well, you have real equity, and you are not on a deadline, listing with a local agent may net you more, and we will say so and point you to someone local. For statewide options see our Indiana cash home buyer page, for the northeast corner see Fort Wayne cash buyer options, and for a side-by-side of every route see our ranked guide to the best way to sell a house for cash in Indiana.
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Let's chatOr call or text (615) 552-4296 to speak with the decision-maker. Our offer stands, so you can take it to your attorney or your accountant before you decide anything.
Frequently Asked Questions
Will my Indiana property tax bill go down in 2026?
For most homesteads the Senate Enrolled Act 1 pieces pull the 2026 bill down rather than up. The standard homestead deduction is still the full $48,000 on the 2025 assessment date that drives your 2026 bill, the supplemental homestead deduction rose from 37.5% to 40%, and a new credit takes 10% off the bill up to $300 (Indiana Department of Local Government Finance, June 2025). Bill author Senator Travis Holdman projected roughly two-thirds of Hoosier homeowners would pay less in 2026 than in 2025 (Indiana Senate Republicans, April 2025). Your bill can still rise if your assessed value went up sharply or your community approved a new referendum levy.
What is the Indiana homestead credit for 2026?
It is a supplemental homestead credit created by Senate Enrolled Act 1 and codified at IC 6-1.1-20.6-7.7. It equals the lesser of 10% of the property tax liability first due and payable on the homestead for the year, or $300. It applies for property taxes first due and payable in calendar years beginning after December 31, 2025, so taxes payable in 2026 are the first bills to carry it. Taxes imposed after being approved by voters in a referendum are excluded from the calculation (Indiana Department of Local Government Finance, June 2025).
Do I have to apply for the new Indiana homestead credit?
No. IC 6-1.1-20.6-7.7 states that a person is not required to file an application for the credit. The county auditor identifies eligible property and applies the credit to the tax liability automatically (Indiana Department of Local Government Finance, June 2025). You do need the underlying standard homestead deduction on file to qualify for it. Other benefits are not automatic: the $150 Over 65 Credit and the $125 Blind/Disabled Credit both require an application filed with the county auditor on or before January 15 of the year the taxes are first due and payable.
What is the deadline to appeal my Indiana property assessment?
Indiana ties the deadline to when your county mailed the Form 11 Notice of Assessment. If the county mailed the Form 11 before May 1 of the assessment year, the appeal is due June 15 of that assessment year. If the county mailed it on or after May 1, the deadline moves to June 15 of the year in which the county treasurer mails the tax bill (IC 6-1.1-15-1.1(b)(2); Indiana Department of Local Government Finance, February 2026). Older guides citing a flat 45-day window from the Form 11 date are describing a rule the statute no longer uses. Check your own county's posted date with the county assessor.
Is the standard homestead deduction going away in Indiana?
Yes, on a phase-down schedule. Under IC 6-1.1-12-37 as amended by Senate Enrolled Act 1, the standard homestead deduction is $48,000 for the 2025 assessment date, $40,000 for 2026, $30,000 for 2027, $20,000 for 2028, $10,000 for 2029, and $0 for the 2030 assessment date and every assessment date after that (Indiana Department of Local Government Finance, June 2025). Because Indiana bills a year behind the assessment date, the deduction reaches zero on taxes payable in 2031. The supplemental homestead deduction rises over the same period to partly replace it.
What are Indiana's property tax caps?
Indiana caps the tax bill itself, not the tax rate. A property owner does not pay more than 1% of gross assessed value on a homestead, 2% on other residential property and agricultural land, and 3% on other real and personal property, and the caps do not change the local tax rate (Indiana Department of Local Government Finance). The limits sit in Article 10, Section 1 of the Indiana Constitution and are administered under IC 6-1.1-20.6. If your bill is already at the cap, further growth in your assessed value stops adding to it, and the practical way to lower the bill is to lower the assessed value.
Can I sell my Indiana house if I owe back property taxes?
Generally yes. Delinquent property taxes are a lien on the parcel rather than a bar to conveying it. In a normal closing the title company orders a payoff figure from the county treasurer, the delinquent taxes come out of the sale proceeds, the lien is released, and the buyer takes clear title. The constraint is the calendar, because Indiana counties run an annual tax sale on delinquent parcels. Confirm your payoff amount and your county's tax sale date with the county treasurer before you sign anything.
Propcash is a direct cash homebuyer, not a law firm, an accounting firm, or a tax advisor, and does not provide legal, tax, or financial advice. Indiana deduction eligibility, credit amounts, assessment methodology, and appeal deadlines turn on your county's practices and on the notices you actually received, and the SEA 1 schedules above are subject to further action by the General Assembly. Confirm your position with a licensed Indiana attorney or tax professional, with your county auditor, and with your county assessor before acting.