April 23, 2008

Property Assessments, Tax Appeals and Important Legislative Changes

Though Indiana's next statewide real property revaluation/reassessment is not scheduled until 2011, local officials must make annual adjustments to real property assessments to reflect the effects of inflation and deflation between revaluations.

The March 1, 2007 assessment date (for taxes payable in 2008) will include a trending factor placed on the March 1, 2006 assessment to reflect the increase or decrease in property value between January 1, 2005 and January 1, 2006.  For example, a trending factor of 1.25 (125%) demonstrates that values in the property's area have increased 25% since January 1, 2005. 

Marion County's March 1, 2007 assessment notice (for taxes payable in 2008) should be issued in late summer.  The 2007 (pay 2008) first installment tax bill is likely to be due in late fall.  Noteworthy increases in assessed values for property taxes are anticipated in areas where there has been significant appreciation in real estate over the past two years.

When an assessment notice is issued, the taxpayers has a 45-day window from the date of the notice to file an appeal contesting the assessment.  In some cases, a developer's discount or automatic abatement (RIPD - Investment Deduction) may apply to a taxpayer's value.  These discounts can provide relief to areas facing significant changes in assessed property value. 

Important Legislative Changes - 2008 Session

  1. Caps on Future Property Taxes
    • For the Pay 2009 tax year:
    • 1.5% on residential homesteads
    • 2.5% for non-homestead residential property, agricultural land, long-term care property
    • 3.5% for non-residential real property
    • For the Pay 2010 tax year and thereafter:
      • 1.0% for residential homesteads
      • 2.0% for non-homestead residential property, agricultural land, long term care property
      • 3.0% for non-residential real property
  2. New Appeal Opportunity
    The taxpayer may file an appeal for the March 1, 2007 assessment date (for taxes payable in 2008) from an Assessment Notice, or the later of July 1, 2008 or 45 days after the 2008 pay 2008 first installment tax bill is issued. This reopens deadlines throughout the state.
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