Article
Upcoming Indiana property tax changes – What you need to know
July 14, 2025 · Authored by Michael Guerrettaz
Significant changes are coming to Indiana’s property tax system beginning in 2025, following the passage of Senate Enrolled Act 1 (SEA 1) and House Enrolled Act 1427 (HEA 1427). Parts of these reforms are designed to provide targeted tax relief for homeowners, landlords, and veterans, while also reshaping how local governments receive and manage property tax revenue.
Changes you can expect
Under SEA 1, the standard homestead deduction will begin to phase out in 2025, starting at $48,000 and ending entirely following 2030. To help offset this change, the supplemental homestead deduction will increase from 37.5% to 66.7% over the same period. Additionally, a new 10% homestead tax credit—capped at $300—will be introduced to provide further relief to homeowners.
Non-homestead properties under the 2% property tax cap category, which includes agricultural, non-homestead residential and long-term care properties, will also see new deductions. This deduction will start at 6% of assessed value in the 2026 tax year and gradually increase to 33.4% in 2031.
HEA 1427 brings expanded benefits for veterans with service-connected disabilities. Veterans who served at least 90 days and received an honorable discharge may qualify for deductions ranging from 50% to 100% of their home’s assessed value, depending on their disability rating. Those who received their home from a nonprofit organization may also be eligible.
