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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowAfter two years of study committee debate and campaign promises, lawmakers have started providing a glimpse of how tax reform conversations have developed into legislation for the 2025 session.
About 300 bills have been filed so far ahead of the General Assembly’s reconvening Wednesday to begin official business. Policymakers have proposed at least 12 tax bills including several seeking to create or adjust property tax credits or deductions and institute freezes of tax bills. Changes are also drafted for gas, income and sales taxes.
Bills will be formally introduced and assigned to committees beginning next week.
A legislative committee studied property taxes over the past two years, which resulted in broad recommendations released in November. Senate Tax and Fiscal Policy Chair Travis Holdman, R-Markle, said in mid-December that his caucus is ready to introduce between 12 and 15 property tax bills.
In addition, one of Gov.-elect Mike Braun’s campaign promises was to slash property taxes.
Under Braun’s plan, increases in property tax bills would be capped at 2% annually for seniors, low-income Hoosiers and families with children under 18. Increases would be capped at 3% for all other property owners. Increases higher than those levels would require approval from voters, although it’s not clear how a referendum would address the different ways property taxes might increase.
Also under Braun’s plan, homeowners with assessed values of more than $125,000 would see those amounts reduced by 60% under a revamped homestead deduction. Those with homes valued under $125,000 would be reduced by 60% deduction. Both would also receive the current standard deduction of $48,000.
Here are the tax bills filed so far:
Easing property tax bills
Lawmakers have focused their efforts on reducing the assessed values through deductions and targeting tax relief through credits for seniors and veterans.
Several property tax-focused bills could have multi-million implications for local governments, according to the bills’ fiscal analyses.
Rep. Heath VanNatter, R-Kokomo, has filed House Bill 1028, which would freeze a homeowner’s property tax liability at the 2025 rate. House Bill 1075, authored by Rep. Craig Haggard, R-Mooresville, is similar.
Haggard’s bill also proposes to eventually double a deduction for disabled veterans that reduces asessed value by $50,000. The bill also provides a 100% tax credit for seniors, essentially wiping out their tax bills.
Senate Bill 105, authored by Sen. Rick Niemeyer, R-Lowell, would call for an update of the assessed value of real property (taxes on commercial land and its buildings) every four years instead of annually. By lengthening the cycle, assessments would lag behind the market value of property, which could make bills more stable in non-assessment years but then make changes more significant when they do occur.
A trio of Republican lawmakers is proposing to eliminate the assessed value cap on the property tax deduction for veterans. Senate Bill 41—authored by Republican Sens. Dan Dernulc, Jim Tomes and Niemeyer—would scrap the $240,000 cap and allow nearly 16,000 more veterans to claim the tax advantage for about $220.4 million in new deductions, starting with the 2027 tax bill.
Rep. David Abbott, R-Rome City, and Rep. Ben Smaltz, R-Auburn, penned House Bill 1101 which proposes a series of property tax adjustments for Hoosiers over 65. The bill proposes to increase the adjusted gross income threshold by $10,000, totaling $40,000 for individuals and $50,000 for joint households. It also would adjust the maximum assessed value cap to qualify for a deduction from $240,000 to $350,000.
Another bill from Sen. La Keisha Jackson, D-Indianapolis, aims to provide seniors who have owned their home for at least five years to take a $120,000 deduction to reduce their property’s assessed value.
Reducing income taxes
Bills have also been introduced that could reduce some Hoosiers’ income tax returns.
House Bill 1018, authored by Rep. Kyle Pierce, R-Anderson, would create a tax credit to incentivize Hoosiers to repair homes more than 85 years old. The credit, which would be deducted from a person’s state income taxes, would equal either 20% of the cost of renovation or 55% if the project involves pre-1940 wiring.
Tomes wants to increase the maximum renter’s income deduction from $3,000 annually to $4,000 with Senate Bill 25.
Democrat Sen. Lonnie Randolph’s Senate Bill 154 would increase the income tax credit for teachers to write off classroom supplies from $100 to $500. He also seeks to broaden a $1,000 per child tax credit meant for taxpayers who homeschool or send their children to private schools; his bill would allow taxpayers who send their kids to public schools to also claim the credit.
Other taxes
Republican Rep. Mark Genda’s House Bill 1042 proposes removing the sales tax on feminine hygiene products and adult diapers. The change, as estimated by the fiscal note, would reduce state sales tax revenue by $11 million in the first year. Sales tax totaled $10.4 billion in state revenue last fiscal year.
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How do they plan on addressing the holes that they’re blowing in local budgets?
Oh, they aren’t? They’re just saying “F U” to localities and moving on? Typical.
I also love that they’re just proposing what Reagan did in California with Prop 13, which has resulted in a catastrophic housing crisis built up over decades. More Republican failures coming to Indiana.
Let’s call property tax cuts what they are – a move to defund local government and schools that local governments will have to actually carry out. It’s real easy to say “well, the locals can just raise income taxes.”
A few areas will pass those increases, likely those areas that already pass tax increases like school referendums. They’re the areas of Indiana where people already want to move to – the big cities and the donut counties.
Throughout much of Indiana, because elected officials like to stay in office, they will cut services rather than implement local income tax hikes… and catch the blame for less police and even worse schools. Meanwhile, these same state legislators claim to care about the failing state of much of Indiana … will continue to profess an ignorance of the connection of their actions.
What Indiana needs is investment in the future. Better infrastructure. Better education system. A healthier workforce. What we have are legislators who don’t see a future worth investing in.
wait, are you suggesting the Indiana Republicans are working on defunding the police? Does President Trusk know about this? PJ Pance?
Sycophants and courtesans…that’s the composition of the Republican majority of the Indiana Legislature.
The legislature always 10 steps behind. Let’s take an issue thats important and study it for years. The issue is that people’s property tax bills shot up ridiculously fast. The cap is on the percentage of assessed value not on the increase in assessed values. So that’s the problem they should be looking to solve. My taxes went up 25% in one year. So that’s what they need to be focused and not screw the cities. There should be a balance.
Hilarious. The Indy View readers are mad about potential tax cuts.