First Regular Session of the 123rd General Assembly (2023)
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SENATE ENROLLED ACT No. 46
AN ACT to amend the Indiana Code concerning taxation.
Be it enacted by the General Assembly of the State of Indiana:
SECTION 1. IC 6-1.1-49 IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2023]:
Chapter 49. County Option Circuit Breaker Tax Credit
Sec. 1. As used in this chapter, "homestead" refers to a
homestead that has been granted a standard deduction under
IC 6-1.1-12-37.
Sec. 2. As used in this chapter, "neighborhood enhancement
district" refers to a geographic territory designated by a county
fiscal body and established as a designated area in an ordinance
adopting a county option circuit breaker tax credit under section
4 of this chapter.
Sec. 3. As used in this chapter, "qualified individual" means an
individual who:
(1) has received a standard deduction granted under
IC 6-1.1-12-37 for the individual's homestead property in the
immediately preceding calendar year (or was married at the
time of death to a deceased spouse who qualified for a
standard deduction granted under IC 6-1.1-12-37 for the
individual's homestead property in the immediately preceding
calendar year);
(2) is receiving a standard deduction granted under
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IC 6-1.1-12-37 for the same homestead property in the
current calendar year;
(3) has lived in the homestead for at least ten (10) years on or
before December 31 of the calendar year immediately
preceding the current calendar year;
(4) is fifty-five (55) years of age or older on or before
December 31 of the calendar year preceding the year in which
the credit is claimed; and
(5) had:
(A) in the case of an individual who filed a single return,
adjusted gross income (as defined in Section 62 of the
Internal Revenue Code) not exceeding the amount
specified in the ordinance adopted by the county under
section 4(c)(2) of this chapter; or
(B) in the case of an individual who filed a joint income tax
return with the individual's spouse, combined adjusted
gross income (as defined in Section 62 of the Internal
Revenue Code) not exceeding the amount specified in the
ordinance adopted by the county under section 4(c)(2) of
this chapter;
for the calendar year preceding by two (2) years the calendar
year in which property taxes are first due and payable.
Sec. 4. (a) Subject to subsection (h), a county fiscal body may
adopt an ordinance to provide a credit against a qualified
individual's property tax liability as set forth in this chapter.
(b) An ordinance adopted under this section may designate a
neighborhood enhancement district. A neighborhood enhancement
district may include:
(1) all of the territory of the county; or
(2) one (1) or more specific geographic territories within the
county;
as an area in which qualified individuals may apply for the credit.
(c) Subject to subsection (h), an ordinance adopted under this
section must:
(1) include a boundary description of the neighborhood
enhancement district or districts to which the ordinance
applies;
(2) specify the income thresholds for a qualified individual
under section 3(5)(A) and 3(5)(B) of this chapter, if any; and
(3) specify the percentage of increase on a qualified
individual's property tax liability in a particular year
compared to the prior year that is to be used in determining
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the amount of the county option circuit breaker tax credit
calculated under section 7(2)(B) of this chapter. The
percentage must be at least two percent (2%) but not more
than five percent (5%).
The boundary description required under subdivision (1) must be
sufficient to identify the parcel or parcels to which the credit may
be applied, including identification by taxing district, a parcel list,
or a legal description.
(d) If a proposal is presented to the county fiscal body to adopt
an ordinance under this section, the county fiscal body shall hear
the proposal at a public meeting of the county fiscal body and may
then vote to adopt the ordinance at the next meeting of the county
fiscal body.
(e) The county fiscal body may rescind an ordinance adopted
under this section.
(f) An ordinance adopted under this section is effective January
1 of the year following the year in which the ordinance is adopted.
(g) An ordinance adopted under this section must specify that
the credit does not apply for property taxes first due and payable
after December 31, 2027.
(h) A county fiscal body shall prescribe the same income
thresholds, credit amounts, and any other requirements related to
eligibility for each neighborhood enhancement district designated
in the county.
Sec. 5. If a county fiscal body adopts an ordinance to either
provide the credit under this chapter or rescind an ordinance
previously adopted, the county fiscal body shall, not later than
fifteen (15) days after the adoption of the ordinance, give notice of
the adoption of the ordinance to:
(1) the department of local government finance on the form
and in the manner prescribed by the department of local
government finance;
(2) the county auditor; and
(3) the fiscal officer of each taxing unit within the
neighborhood enhancement district or districts to which the
ordinance applies;
including a certified copy of the adopted ordinance.
Sec. 6. (a) A qualified individual who desires to claim the credit
under this chapter must apply for the credit by filing a certified
statement on forms prescribed by the department of local
government finance with the county auditor. However, a qualified
individual who remains eligible for the credit in the following year
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is not required to file a statement to apply for the credit in the
following year.
(b) An individual who has a credit provided under this chapter
applied to the individual's property tax liability in a particular
calendar year may not also have a credit under IC 6-1.1-20.6-8.5
applied to the individual's property tax liability in the same
calendar year.
(c) Not more than one (1) credit may be claimed under this
chapter with respect to a particular homestead by any qualified
individual.
Sec. 7. The amount of the credit under this chapter is equal to
the greater of zero (0) or the result of:
(1) the property tax liability first due and payable on the
qualified individual's homestead property for the calendar
year (excluding any property tax liability imposed in a voter
approved referendum levy); minus
(2) the result of:
(A) the property tax liability first due and payable on the
qualified individual's homestead property for the
immediately preceding year after the application of the
credit granted under this section for that year (excluding
any property tax liability imposed in a voter approved
referendum levy); multiplied by
(B) the sum of:
(i) the percentage adopted in an ordinance under section
4(c)(3) of this chapter, expressed as a decimal; plus
(ii) one (1).
However, the credit provided by this chapter shall not apply to any
portion of property tax liability imposed on a qualified individual's
homestead property that is used for trade or business purposes in
connection with the production of income. In addition, the credit
does not affect the allocation of taxes to a referendum fund.
Sec. 8. If the ownership of a homestead for which a qualified
individual received a credit under this chapter changes, and the
qualified individual no longer owns or principally resides in the
homestead, the county auditor shall remove the designation of the
individual as a qualified individual with respect to that homestead.
Sec. 9. The auditor of each county shall, in a particular year,
apply a credit provided under this chapter to each qualified
individual who received the credit in the preceding year unless the
county auditor determines that the individual is no longer eligible
for the credit or the county fiscal body rescinds the ordinance that
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provided the credit.
Sec. 10. (a) If an individual who is receiving the credit provided
by this chapter:
(1) knows or should have known that the individual does not
qualify for the credit under this chapter; or
(2) changes the use of the individual's property so that part or
all of the property no longer qualifies for the credit under this
chapter;
the individual must file a certified statement with the county
auditor, notifying the county auditor that subdivision (1) or (2)
applies, not more than sixty (60) days after the date subdivision (1)
or (2) first applies.
(b) An individual who fails to file the statement required by this
section is liable for any additional taxes that would have been due
on the property if the individual had filed the statement as
required by this section, plus a civil penalty equal to ten percent
(10%) of the additional taxes due. The additional taxes owed plus
the civil penalty become part of the property tax liability for
purposes of this article.
(c) The civil penalty imposed under this section is in addition to
any interest and penalties for a delinquent payment that might
otherwise be due. One percent (1%) of the total civil penalty
collected under this section shall be transferred by the county to
the department of local government finance for use by the
department in establishing and maintaining the homestead
property data base under IC 6-1.1-12-37(i) and, to the extent there
is money remaining, for any other purposes of the department.
Sec. 11. This chapter expires January 1, 2028.
SEA 46 — Concur President of the Senate
President Pro Tempore
Speaker of the House of Representatives
Governor of the State of Indiana
Date: Time:
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