Rep. Gregory Porter: Indiana’s property tax relief for seniors is inadequate

Should lawmakers approve property tax relief for seniors?

Unless you sell or rent, your house isn’t a source of income. That’s one of the reasons property taxes are hard to swallow. You’re being charged for something that gives you no money, good or service in return.

All homeowners experience the burden of rising property taxes, but seniors with limited incomes have been hit the hardest. Property taxes have spiked from rising assessments and housing market inflation post-COVID-19. Now many seniors can’t afford to stay in their homes.

Indiana’s property tax relief for seniors is inadequate. We’ve failed to ensure our seniors can continue to afford the American dream. We have an over 65 deduction, which reduces assessed value by up to $14,000. We also have the over 65 circuit breaker credit, which limits increases in property tax liability to 2% each year. But both opportunities fail to provide real relief.

The problem is, many seniors are ineligible for these savings. The current income thresholds are low, at $33,653 (single) and $44,871 (combined), eliminating thousands in need. An assessed value threshold of $240,000 also comes into play. It’s an all-or-nothing gamble where seniors qualify or get nothing. Thousands of seniors who are by no means wealthy receive no help.

To create real relief, we can do a few things. First, the state should step up and pay for property tax relief. Our local governments have limited revenue and craft their budgets predominantly with property taxes. Unless the state foots some of the bill, local governments will lose a portion of funding. We don’t want to shift the burden of lost revenue to others, especially young Hoosiers and first-time buyers. Relief must be balanced with the costs of local needs. We don’t want to strip money from local EMS, fire and other services. Let’s pledge state resources to pay for at least 50% of relief with a homestead credit.

Second, let’s increase the thresholds to maximize eligibility. Other states, like New Jersey, have an income threshold of $500,000. Indiana should do the same. For assessed value, we should make a one-time adjustment based on the market. There’s a “new normal” for home values that should be considered, and we need to create flexibility as assessed value changes over time.

Third, property tax bills should be frozen for struggling seniors until they vacate or sell. Low-income seniors deserve some certainty that they can stay in their homes. Legislators should work with experts to create some sort of affordability criteria to provide tax relief. These criteria would factor in the Social Security cost-of-living adjustment with other unavoidable expenses, like utility costs.

Braun is pledging to cap increases at 2%, or whatever homeowners paid in 2021. With my suggestions, everyone but the wealthiest seniors would receive some relief with the over 65 deduction and credit.

I hope we move beyond stating that seniors need relief. We heard promises but saw no specific recommendations in the final report from the interim committee on property taxes. The word “homeowner” was mentioned once. An empty recitation of the need for relief is an empty gesture.

Let’s strive to make 2025 the year we pass substantial relief for Hoosier seniors. They deserve the opportunity to stay in their homes, and I’m willing to lead that charge. Let’s get it done!•

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Porter, a Democrat, represents District 96 in the Indiana House. He’s the ranking minority member of the House Ways and Means Committee.Send comments to ibjedit@ibj.com.

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