Over-65 Deduction & Credit
Indiana has two property tax benefits specifically for homeowners aged 65 and older:
Over-65 Circuit Breaker (also known as the Over-65 Tax Credit or Tax Cap)
This deduction subtracts from your assessed value one-half of the property value or $12,480, whichever is less. Note: For taxes payable in 2021, the deduction will increase to $14,000.
How much this deduction can save you on your tax bill depends on several factors, such as your tax rate and your property's assessed value. Below are a few examples of tax bills in 2015 for a home assessed at $150,000 with and without the Over-65 Deduction. (These examples include the homestead deductions).
|Tax District||Without Over-65 Deduction||With Over-65 Deduction|
To receive this deduction, taxpayers must meet all the requirements. These requirements include:
- The applicant and any joint tenants or tenants in common must reside in the home for at least one year before the deduction is claimed.
- The property's assessed value cannot exceed $182,430. Note: Beginning with taxes payable in 2021, the assessed value threshold will increase to $200,000..
- The combined adjusted gross income (AGI) of the property owners cannot exceed $25,000. Note: The AGI limit will increase to $30,000 for individuals and $40,000 for those married filing jointly beginning with taxes payable in 2021.
- Applicants must be at least 65 in the year preceding the year in which the deduction is claimed.
- A surviving, un to remarried spouse who is at least 60 may qualify for the deduction if the late spouse was at least 65 and all other criteria are met.
Over-65 Circuit Breaker
This tax cap limits the tax on qualified homesteads to no more than a 2% increase from last year. Note that this tax cap applies only to the homestead portion of the property.
The requirements include:
- The homestead's assessed value cannot exceed $160,000
- The adjusted gross income (AGI) cannot exceed $30,000 for an individual or $40,000 for married couples filing jointly.
How to Apply
Taxpayers use the same form to apply for the Over-65 Deduction and/or the Over 65 Tax Credit. You may pick up a form at the County Auditor's office. Or click on the following to print up a form: Over-65 Deduction and Over-65 Circuit Breaker Credit form (PDF)
Frequently Asked Questions:
Q: Can I receive both the Over-65 Deduction and the Over-65 Tax Credit?
A: Yes, as long as you meet all criteria.
Q: Is my Over-65 deduction affected if my child is on the deed with me?
A: The person applying for the deduction and any joint tenants or tenants in common other than a spouse must live in the home. The deduction is lowered by a fraction based on the number of owners (other than a spouse) younger than 65. For example: A father and his son are both on the deed and both live in the home. All criteria are met, except that the son is younger than 65. In this case, one-half of the deduction is allowed.
Q: How do I determine my AGI?
A: Look at your most recent federal income tax return. When you apply, be prepared to show the auditor's office a copy of your and any co-owners' tax returns.
For More Information
You might also want to pick up our flier, "Over-65 Deduction & Tax Credit," which has more information. This flier is available at the Porter County Auditor's office.
Note: The information on this page is a general guide only and should not be construed as legal advice or as a final determination of one's eligibility for a deduction or tax credit. Additional restrictions may apply.