LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6684 NOTE PREPARED: Dec 19, 2024
BILL NUMBER: SB 392 BILL AMENDED:
SUBJECT: Property Tax Relief for Seniors and Veterans.
FIRST AUTHOR: Sen. Rogers BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED: GENERAL IMPACT: Local
DEDICATED
FEDERAL
Summary of Legislation: This bill makes certain changes to the qualification requirements and credit
amount for the over 65 circuit breaker credit.
The bill also makes certain changes to the qualification requirements and deduction amount for the property
tax deduction for disabled veterans who are either totally disabled or at least 62 years of age with a partial
disability.
Effective Date: January 1, 2025 (retroactive).
Explanation of State Expenditures:
Explanation of State Revenues:
Explanation of Local Expenditures:
Explanation of Local Revenues: Summary: Each of the provisions in this bill will result in a reduction of
local revenues due to an increase in property tax cap losses. The changes relating to the disabled veterans
deduction will also cause tax shifts from the taxpayers receiving the deduction to all other taxpayers to the
extent that those other taxpayers have not yet reached their tax cap.
Additional Information:
Disabled Veterans Deduction: Under current law, a veteran who is (a) totally disabled or (b) at least 62 years
old with at least a 10% disability may qualify for the totally disabled veteran deduction. To qualify, the gross
assessed value (AV) of the veteran’s Indiana real property, mobile home, or manufactured home must not
exceed $240,000. The deduction is equal to $14,000 AV.
Under this bill, beginning with taxes payable in CY 2026, the AV limit will increase to $300,000 and
beginning with taxes payable in CY 2027, the AV limit will grow by the increase in the year-end average of
SB 392 1 the monthly median home sale prices in Indiana. If the qualifying taxpayer’s AV exceeds $300,000 (as
adjusted), then the deduction is reduced from $14,000 AV to $7,000 AV.
This provision will result in an increase in the number of disabled veterans who may qualify for the
deduction. Based on current claim rates and homestead values, an estimated additional 5,400 veterans could
claim about $75 M in AV deductions worth about $1.6 M in taxes.
[For taxes payable in 2024 under current law, 28,200 taxpayers claimed the totally disabled veteran
deduction, totaling $385 M in AV.]
Property Tax Credit: Under current law, a homestead owner may qualify for the age 65 and over property
tax circuit breaker credit if (1) they are at least 65 years old, (2) own Indiana real property with a gross AV
under $240,000, and (3) have an AGI not exceeding $30,000 (individual filers) or $40,000 (joint filers). This
credit limits the growth in net property tax bills to 2% per year.
Under this bill, beginning with taxes payable in CY 2026, the AGI limit will increase to a household AGI
limit of $75,000, and the AV must be less than $300,000.
Beginning with taxes payable in CY 2027, the household AGI limit will grow each year by the Social
Security cost of living adjustment and the AV limit will grow by the increase in the year-end average of the
monthly median home sale prices in Indiana. However, the qualifying AV limit for an initial filer may not
exceed $400,000. If the qualifying taxpayer’s AV exceeds $300,000 (as adjusted), then the net tax growth
limit increases from 2% to 4%.
The changes in the AV and income limits could result in an estimated 43,000 to 56,000 additional taxpayers
qualifying for the credit beginning in CY 2026. Initially, the additional credits will be minimal but will
increase over time.
[For taxes payable in 2024 under current law, 68,800 taxpayers received age 65 and over tax cap credits
totaling $31.4 M in taxes.]
State Agencies Affected:
Local Agencies Affected: County auditors; Civil taxing units and school corporations.
Information Sources: LSA's property tax database; LSA’s income tax database.
Fiscal Analyst: Bob Sigalow, 317-232-9859.
SB 392 2