County officials set new rules for homestead property tax deductions

On March 12, 2025, Indiana House Legislation introduced House Bill 1050, a significant piece of legislation aimed at reforming property tax deductions for homesteads. The bill seeks to clarify and streamline the process for homeowners to claim deductions, while also imposing stricter requirements for reporting changes in property eligibility.

The primary purpose of House Bill 1050 is to ensure that homeowners who receive property tax deductions are compliant with state regulations. Key provisions include a requirement for individuals to file a certified statement with the county auditor by January 15 of the year in which property taxes are due. This statement must confirm eligibility for the homestead deduction, and homeowners must notify the auditor within 60 days if their property use changes, affecting their eligibility.

Notably, the bill introduces penalties for non-compliance. Homeowners who fail to file the necessary statements may face additional taxes owed, along with a civil penalty of 10% of the unpaid taxes. This penalty structure aims to encourage timely reporting and compliance among property owners.

The introduction of House Bill 1050 has sparked debates among lawmakers and stakeholders. Proponents argue that the bill will enhance accountability and ensure that tax deductions are only granted to eligible homeowners, potentially increasing revenue for local governments. Critics, however, express concerns that the stringent reporting requirements may burden homeowners, particularly those who may not be aware of the changes in eligibility criteria.

The economic implications of this bill could be significant. By tightening the rules around property tax deductions, the state may see an increase in tax revenue, which could be allocated to essential services. However, there are fears that the added financial pressure on homeowners could lead to increased housing instability for those who struggle to meet the new requirements.

As House Bill 1050 moves through the legislative process, its future remains uncertain. Lawmakers will need to weigh the benefits of increased compliance against the potential impact on homeowners. The bill's progression will be closely monitored, as it could set a precedent for how property tax deductions are managed in Indiana moving forward.