Indiana Property Tax Relief: Deductions, Caps, and Filing

Indiana property tax relief comes in layers: deductions that shrink your home’s taxable assessed value, credits that cut the final bill, and constitutional caps that set a hard ceiling on what you can be charged. The standard homestead deduction alone removes up to $45,000 from assessed value, and additional relief exists for mortgage holders, seniors, blind or disabled residents, and veterans. The rules changed significantly in 2025, so some figures you may have seen elsewhere are out of date.

The Homestead Deductions

If you own and occupy an Indiana home as your principal residence, two stacked homestead deductions do most of the work.

The standard homestead deduction reduces your home’s assessed value by $45,000 or 60% of the gross assessed value, whichever is less.¹ On a $200,000 home, that is a flat $45,000 cut. On a $60,000 home, it is $36,000, because 60% of the assessed value is smaller than $45,000. You file the claim once with your county auditor, and it stays in place as long as you live there.

The supplemental homestead deduction then takes a percentage off whatever assessed value remains. For taxes payable in 2026, that percentage is 40%. Under legislation enacted in 2025, the rate climbs each year: 46% for taxes payable in 2027, 52% in 2028, 57% in 2029, 62% in 2030, and 66.7% from 2031 forward.² You do not have to apply for the supplemental deduction separately. It attaches automatically once the standard homestead deduction is on file.

The Mortgage Deduction

If your primary residence carries a recorded mortgage, home equity line of credit, or installment loan, you can take up to $3,000 off assessed value. The actual amount is the smallest of three figures: the remaining loan balance on the assessment date, half the property’s assessed value, or $3,000.³ The mortgage or land contract has to be recorded with the county recorder. The dollar impact is small, but it stacks on the homestead deductions and takes one filing to secure.

Senior Relief After the 2025 Overhaul

Indiana repealed the old Over 65 Deduction, which had subtracted $14,000 from assessed value, for assessment dates beginning January 1, 2025.⁴ Two benefits took its place.

The Over 65 Circuit Breaker Credit caps year-over-year growth in your property tax bill. Your tax liability cannot rise more than 2% over the previous year’s bill after the credit was applied. If assessments or rates would otherwise push the bill up 8%, the credit absorbs everything above the 2% line.⁵ In areas where values are climbing quickly, this can be worth far more than the flat deduction it replaced.

A separate flat credit of $150 against local property taxes is also available to qualifying homeowners age 65 and older.⁶

Income limits are now much higher than they used to be. Single filers can earn up to $60,000 in adjusted gross income, and joint filers up to $70,000, compared with the old $30,000 and $40,000 thresholds. The former cap on the property’s assessed value at $240,000 is gone, so seniors in higher-value homes now qualify as well.⁴

Deduction for Blind or Disabled Residents

Residents who are blind or have a qualifying disability can reduce assessed value by $12,480. The property has to be your primary residence, and your taxable gross income for the prior year cannot exceed $17,000. Income that is not taxed under federal law does not count toward that $17,000 limit.⁷

A qualifying disability means an inability to perform any substantial work because of a physical or mental condition that has lasted, or is expected to last, at least 12 months or result in death. Proof of eligibility for Social Security disability benefits satisfies the requirement. If you are not covered by Social Security, a physician’s examination applying the same standards can be used at your expense.⁷ The deduction has no age requirement and combines with the homestead deductions.

Veteran Deductions

Two veteran deductions exist, and a veteran can claim only one of them on the same property, though either can be combined with the homestead deductions.

Partial Service-Connected Disability Deduction

Veterans who served during a recognized period of war, received an honorable discharge, and carry a service-connected disability rating of at least 10% can deduct $24,960 from assessed value.⁸ Peacetime-only service does not qualify. Recognized war periods include World War II, Korea, Vietnam, and the Gulf War era running from August 2, 1990, forward.⁹

The disability must be documented through a pension certificate, compensation award, or disability check from the U.S. Department of Veterans Affairs, or a certificate of eligibility from the Indiana Department of Veterans Affairs. Surviving spouses of veterans who met the requirements at death can continue receiving the deduction.⁸

Totally Disabled or Older Veteran Deduction

A $14,000 deduction is available to veterans who are totally disabled or who are at least 62 with a disability rating of 10% or more.¹⁰ The disability does not have to be service-related. The veteran must have served at least 90 days with an honorable discharge, and the property’s assessed value cannot exceed $200,000.¹¹

The Constitutional Tax Caps

After all deductions are applied, Article 10, Section 1 of the Indiana Constitution puts a hard ceiling on your total bill as a share of gross assessed value:¹²

Homesteads: 1% of gross assessed value
Other residential property and agricultural land: 2%
Commercial, industrial, and other real property: 3%
Personal property: 3%

The caps operate as an automatic circuit breaker credit. If combined local tax rates would push your bill above the applicable percentage, the excess is removed from what you owe. On a $200,000 homestead, the total property tax cannot exceed $2,000, no matter how high local rates run. Because these limits sit in the state constitution, no local government can vote around them.

How to File

Every deduction and credit runs through the county auditor’s office where the property is located. Filing may be in person, by mail, or through an online portal, depending on the county. The Indiana Department of Local Government Finance publishes the forms, and county auditors keep paper copies on hand.¹³ The forms you are most likely to need:

Form HC10 for the standard and supplemental homestead deductions
Form 43708 for the Over 65 Circuit Breaker Credit and other senior benefits
Form 43710 for the blind or disabled person’s deduction
Form 12662 for the veteran deductions

You will need the parcel number, Social Security numbers for everyone on the deed, and proof of residency. Income-tested benefits require federal tax returns or comparable financial records. Veteran claims require documentation from the U.S. Department of Veterans Affairs or a DD-214.

Deadlines shift by benefit and by year. The DLGF states that applications completed on or before January 15, 2026, apply to the 2025-pay-2026 tax bill.¹⁴ You must have owned the property as of December 31 of the assessment year. Approved deductions and credits do not show up on the current bill; they appear on the following year’s statement. Check that bill or your auditor’s online records to confirm the relief posted correctly, and keep your filing receipts.

When to Appeal the Assessment Itself

Deductions and caps only help if the underlying assessed value is accurate. If your home has been overvalued, an appeal can save more than any deduction. Property owners begin an appeal by filing Form 130 (Taxpayer’s Notice to Initiate an Appeal) with the local assessing official.¹⁵

Appeals come in two flavors. A subjective appeal argues that the assessor overvalued the property and applies to the current year only. An objective appeal targets factual errors, like a wrong property description, a missing deduction, or an arithmetic mistake, and can reach back up to three years.¹⁵

The appeal begins with an informal conference with the local assessing official. If that does not resolve it, the county Property Tax Assessment Board of Appeals hears the case, and further review is available through the Indiana Board of Tax Review and, ultimately, the Indiana Tax Court.

For real property, the filing deadline is generally June 15 of the assessment year if the county mailed the notice of assessment before May 1, or June 15 of the year the tax statement is mailed if the notice came later.¹⁶ The strongest evidence in a valuation appeal is recent sale prices of comparable homes in your area that sold for less than your assessed value. Algorithmic estimates from real estate websites do not carry weight in these proceedings.

1
Department of Local Government Finance. Property Tax Deductions and Exemptions
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Department of Local Government Finance. 2026 Exemptions and Deductions Report
3
Indiana General Assembly. Indiana Code 6-1.1-12-1 – Deduction for Property Financed by Mortgage or Installment Loan
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Department of Local Government Finance. Legislation Affecting Deductions, Exemptions, and Credits
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Indiana General Assembly. Indiana Code 6-1.1-20.6-8.5
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Department of Local Government Finance. Property Tax Deductions and Credits Overview October 2025
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Indiana General Assembly. Indiana Code 6-1.1-12-11 – Deduction for Blind or Disabled Person
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Indiana General Assembly. Indiana Code 6-1.1-12-13 – Deduction for Veteran With Partial Service-Connected Disability
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Indiana Department of Veterans Affairs. Disabled Veteran Property Tax Deduction
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Indiana General Assembly. Indiana Code 6-1.1-12-14 – Deduction for Totally Disabled Veteran or Veteran Age 62 and Partially Disabled
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Department of Local Government Finance. Frequently Asked Questions Veterans’ Deductions
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Indiana General Assembly. Indiana Constitution (as Amended 2024)
13
Department of Local Government Finance. Deduction Forms
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Department of Local Government Finance. Deductions and Credits
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Department of Local Government Finance. Appeals Property Tax
16
Indiana General Assembly. Indiana Code 6-1.1-15-1.1