Hoosiers’ Savings under New Property Tax Overhaul Varies by Income Level
The recent property tax overhaul in Indiana has been signed into law by Governor Mike Braun, with the new bill allowing homeowners to claim a tax credit of up to 10% of their property tax bill, capped at $300. Additional credits are available for disabled veterans and older Hoosiers on fixed incomes. While some experts believe most homeowners will save the full $300, others, such as Ball State University economist Michael Hicks, predict lower savings for the median homeowner.
Local government officials are expected to raise local income tax rates to offset the lost property tax revenue, with caps imposed to prevent excessive increases. However, factors such as inflation and public safety costs may drive local governments to raise rates, resulting in limited actual savings for homeowners. Additionally, adjustments to business personal property tax exemptions may impact homeowners as well, particularly in cities with a high concentration of manufacturers.
Overall, the savings from the new property tax bill are predicted to vary based on individual circumstances and income levels. The provisions of the bill are set to take effect for property taxes paid in 2026.
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