County Homestead/LIT 1% Credit
Porter County’s homestead credit has its roots in the 2005 legislation that established the Northwest Indiana Regional Development Authority. This legislation allowed Porter County to enact a county income tax that would be used for two specific purposes: To raise the revenue needed for the county’s membership in the RDA and to use the balance to fund a property tax cut for homeowners in the form of a homestead credit.
For tax bills payable in 2019, the homestead credit rate was 10.1568%. Generally speaking, this means that homeowner tax bills were reduced by about 10 percent for the homestead portion of their tax (unless the Circuit Breaker tax credit cuts the bill further; see below). The credit for tax bills in 2020 has not yet been calculated.
You can find out how much the homestead credit saved you on your tax bill by looking at line 4a on the statement that comes with your tax bill, the Treasurer’s Form TS to 1A. Below are some examples of the credit on homes assessed at $160,000 in select taxing districts in 2015. (These examples include the homestead deductions).
|Taxing District||Homestead Credit|
*See note below
Circuit Breaker Impact
The homestead credit is calculated on all homesteads. However, if a homestead’s tax exceeds the limit allowed by the Circuit Breaker, the tax bill is reduced to the maximum allowed. In the examples above, the tax bills for the Valparaiso and Portage homesteads were reduced further after the homestead credit was applied because the tax would have otherwise exceeded the tax cap limit.
Homestead Credit Rates
The homestead credit rate can change each year due in part to fluctuations in county income tax revenues. Below is a history of the homestead credit rates beginning in 2010.
Note: Statewide changes in the county income tax statute affected how the homestead credit is calculated, beginning with tax bills payable in 2017. The credit is now known as the LIT 1% credit, which refers to the fact that the credit is applied only to homesteads, which are in the 1% tax cap category.