Information Maintained by the Office of Code Revision Indiana Legislative Services Agency
12/05/2008 03:48:38 AM EST
IC 6-1.1-20.6
     Chapter 20.6. Credit for Excessive Residential Property Taxes

IC 6-1.1-20.6-0.5
"Agricultural land"

Effective 1-1-2009.

    
Sec. 0.5. As used in this chapter, "agricultural land" refers to land assessed as agricultural land under the real property assessment rules and guidelines of the department of local government finance.
As added by P.L.146-2008, SEC.213.

IC 6-1.1-20.6-1 Version a
"Apartment complex"
    
Note: This version of section effective until 1-1-2009. See also following repeal of this section, effective 1-1-2009.
    Sec. 1. As used in this chapter, "apartment complex" means real property consisting of at least five (5) units that are regularly used to rent or otherwise furnish residential accommodations for periods of thirty (30) days or more.
As added by P.L.246-2005, SEC.62.

IC 6-1.1-20.6-1 Version b
Repealed
    
(Repealed by P.L.146-2008, SEC.811.)
    Note: This repeal of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.

IC 6-1.1-20.6-1.6
"Gross assessed value"

Effective 1-1-2009.

    
Sec. 1.6. As used in this chapter, "gross assessed value" refers to the assessed value of property after the application of all exemptions under IC 6-1.1-10 or any other provision.
As added by P.L.146-2008, SEC.214.

IC 6-1.1-20.6-2 Version a
"Homestead"
    
Note: This version of section effective until 1-1-2009. See also following version of this section, effective 1-1-2009.
    Sec. 2. As used in this chapter, "homestead" has the meaning set forth in IC 6-1.1-20.9-1.
As added by P.L.246-2005, SEC.62.

IC 6-1.1-20.6-2 Version b
"Homestead"
    
Note: This version of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.
    Sec. 2. (a) As used in this chapter, "homestead" has the meaning set forth in IC 6-1.1-12-37.
    (b) The term includes a house or apartment that is owned or

leased by a cooperative housing corporation (as defined in 26 U.S.C. 216(b)).
As added by P.L.246-2005, SEC.62. Amended by P.L.146-2008, SEC.215.

IC 6-1.1-20.6-2.3
"Long term care property"

Effective 1-1-2009.

    
Sec. 2.3. As used in this chapter, "long term care property" means property that:
        (1) is used for the long term care of an impaired individual; and
        (2) is one (1) of the following:
            (A) A health facility licensed under IC 16-28.
            (B) A housing with services establishment (as defined in IC 12-10-15-3) that is allowed to use the term "assisted living" to describe the housing with services establishment's services and operations to the public.
            (C) An independent living home that, under contractual agreement, serves not more than eight (8) individuals who:
                (i) have a mental illness or developmental disability;
                (ii) require regular but limited supervision; and
                (iii) reside independently of their families.
As added by P.L.146-2008, SEC.216.

IC 6-1.1-20.6-2.4
"Manufactured home"; "mobile home"

Effective 1-1-2009.

    
Sec. 2.4. As used in this chapter:
        (1) "manufactured home" has the meaning set forth in IC 22-12-1-16; and
        (2) "mobile home" has the meaning set forth in IC 16-41-27-4.
As added by P.L.146-2008, SEC.217.

IC 6-1.1-20.6-2.5
"Nonresidential real property"

Effective 1-1-2009.

    
Sec. 2.5. (a) As used in this chapter, "nonresidential real property" refers to either of the following:
        (1) Real property that:
            (A) is not:
                (i) a homestead; or
                (ii) residential property; and
            (B) consists of:
                (i) a building or other land improvement; and
                (ii) the land, not exceeding the area of the building footprint or improvement footprint, on which the building or improvement is located.
        (2) Undeveloped land in the amount of the remainder of:
            (A) the area of a parcel; minus
            (B) the area of the parcel that is part of:
                (i) a homestead; or
                (ii) residential property.
    (b) The term does not include agricultural land.
As added by P.L.146-2008, SEC.218.

IC 6-1.1-20.6-3
"Property tax liability"
    
Sec. 3. As used in this chapter, "property tax liability" means, for purposes of:
        (1) this chapter, other than section 8.5 of this chapter, liability for the tax imposed on property under this article determined after application of all credits and deductions under this article or IC 6-3.5, except the credit under this chapter, but does not include any interest or penalty imposed under this article; and
        (2) section 8.5 of this chapter, liability for the tax imposed on property under this article determined after application of all credits and deductions under this article or IC 6-3.5, including the credit granted by section 7 or 7.5 of this chapter, but not including the credit granted under section 8.5 of this chapter or any interest or penalty imposed under this article.
As added by P.L.246-2005, SEC.62. Amended by P.L.146-2008, SEC.219.

IC 6-1.1-20.6-3.5
"Qualified homestead property"
    
Sec. 3.5. As used in this chapter, "qualified homestead property" means a homestead that satisfies the following requirements:
        (1) The individual who:
            (A) owns the homestead;
            (B) is purchasing the homestead under a contract, recorded in the county recorder's office, that provides that the individual is to pay the property taxes on the residence; or
            (C) has a beneficial interest in the owner of the homestead;
        is or will be at least sixty-five (65) years of age on or before December 31 of the calendar year immediately preceding the calendar year in which property taxes are first due and payable.
        (2) The:
            (A) adjusted gross income (as defined in Section 62 of the Internal Revenue Code) of the individual claiming the credit for a homestead; or
            (B) combined adjusted gross income (as defined in Section 62 of the Internal Revenue Code) of the individual and the individual's spouse;
        does not exceed the amount determined under section 8.5 of this chapter for the calendar year preceding the calendar year in which property taxes are first due and payable by two (2).
        (3) The gross assessed value of the homestead on the assessment date for which property taxes are imposed is less than one hundred sixty thousand dollars ($160,000).
As added by P.L.146-2008, SEC.220.



IC 6-1.1-20.6-4 Version a
"Qualified residential property"
    
Note: This version of section effective until 1-1-2009. See also following version of this section, effective 1-1-2009.
    Sec. 4. As used in this chapter, "qualified residential property" refers to any of the following that a county fiscal body specifically makes eligible for a credit under this chapter in an ordinance adopted under section 6 of this chapter and to all the following for purposes of section 6.5 of this chapter:
        (1) An apartment complex.
        (2) A homestead.
        (3) Residential rental property.
As added by P.L.246-2005, SEC.62. Amended by P.L.162-2006, SEC.7.

IC 6-1.1-20.6-4 Version b
"Residential property"
    
Note: This version of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.
    Sec. 4. As used in this chapter, "residential property" refers to real property that consists of any of the following:
        (1) A single family dwelling that is not part of a homestead and the land, not exceeding one (1) acre, on which the dwelling is located.
        (2) Real property that consists of:
            (A) a building that includes two (2) or more dwelling units;
            (B) any common areas shared by the dwelling units; and
            (C) the land, not exceeding the area of the building footprint, on which the building is located.
        (3) Land rented or leased for the placement of a manufactured home or mobile home, including any common areas shared by the manufactured homes or mobile homes.
As added by P.L.246-2005, SEC.62. Amended by P.L.162-2006, SEC.7; P.L.146-2008, SEC.221; P.L.131-2008, SEC.4.

IC 6-1.1-20.6-5 Version a
"Residential rental property"
    
Note: This version of section effective until 1-1-2009. See also following repeal of this section, effective 1-1-2009.
    Sec. 5. As used in this chapter, "residential rental property" means real property consisting of not more than (4) units that are regularly used to rent or otherwise furnish residential accommodations for periods of thirty (30) days or more.
As added by P.L.246-2005, SEC.62.

IC 6-1.1-20.6-5 Version b
     (Repealed by P.L.146-2008, SEC.811.)
    Note: This repeal of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.


IC 6-1.1-20.6-6 Version a
Eligibility for credit before 2007 in Lake County and 2008 in other counties; adoption of ordinance; county fiscal body
    
Note: This version of section effective until 1-1-2009. See also following repeal of this section, effective 1-1-2009.
    Sec. 6. (a) This section applies only to property taxes first due and payable before:
        (1) January 1, 2007, in Lake County; and
        (2) January 1, 2008, in a county other than Lake County.
    (b) A county fiscal body:
        (1) may adopt an ordinance to authorize the application of the credit under this chapter for one (1) or more calendar years to qualified residential property in the county; and
        (2) must adopt an ordinance under subdivision (1) before July 1 of a calendar year to authorize the credit under this chapter for property taxes first due and payable in the immediately succeeding calendar year.
    (c) An ordinance adopted under this section must specify the categories of residential property listed in section 4 of this chapter that are eligible for the credit provided under this chapter.
As added by P.L.246-2005, SEC.62. Amended by P.L.162-2006, SEC.8.

IC 6-1.1-20.6-6 Version b
Repealed
    
(Repealed by P.L.146-2008, SEC.811.)
    Note: This repeal of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.

IC 6-1.1-20.6-6.5 Version a
Eligibility for credit after 2006 in Lake County and 2007 in other counties
    
Note: This version of section effective until 1-1-2009. See also following repeal of this section, effective 1-1-2009.
    Sec. 6.5. (a) This subsection applies only to property taxes first due and payable after December 31, 2006, and before January 1, 2008, attributable to qualified residential property located in Lake County. A person is entitled to a credit each calendar year under section 7(a) of this chapter against the person's property tax liability for property taxes first due and payable in that calendar year attributable to the person's qualified residential property. However, the county fiscal body may, by ordinance adopted before January 1, 2007, limit the application of the credit granted by this subsection to homesteads.
    (b) This subsection applies only to property taxes first due and payable after December 31, 2007, and before January 1, 2010. A person is entitled to a credit each calendar year under section 7(a) of this chapter against the person's property tax liability for property taxes first due and payable in that calendar year attributable to:
        (1) the person's qualified residential property, in the case of a

calendar year before 2008; or
        (2) the person's homestead (as defined in IC 6-1.1-20.9-1) property, in the case of a calendar year after 2007 and before 2010.
    (c) This subsection applies only to property taxes first due and payable after December 31, 2009. A person is entitled to a credit each calendar year under section 7(b) of this chapter against the person's property tax liability for property taxes first due and payable in that calendar year attributable to the person's real property and personal property.
As added by P.L.162-2006, SEC.9. Amended by P.L.1-2007, SEC.43; P.L.224-2007, SEC.37.

IC 6-1.1-20.6-6.5 Version b
Repealed
    
(Repealed by P.L.146-2008, SEC.811.)
    Note: This repeal of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.

IC 6-1.1-20.6-7
Calculation of credit
    
Sec. 7. (a) This subsection expires January 1, 2009. In the case of a credit authorized under section 6 of this chapter or provided by section 6.5(a) or 6.5(b) of this chapter for property taxes first due and payable in a calendar year:
        (1) a person is entitled to a credit against the person's property tax liability for property taxes first due and payable in that calendar year attributable to
            (A) the person's qualified residential property located in the county, in the case of a calendar year before 2008; or
            (B) the person's homestead. (as defined in IC 6-1.1-20.9-1) property located in the county, in the case of a calendar year after 2007 and before 2009; and
        (2) the amount of the credit is the amount by which the person's property tax liability attributable to
            (A) the person's qualified residential property, in the case of a calendar year before 2008; or
            (B) the person's homestead property, in the case of a calendar year after 2007 and before 2009;
for property taxes first due and payable in that calendar year exceeds two percent (2%) of the gross assessed value that is the basis for determination of property taxes on the qualified residential property (in the case of a calendar year before 2008) or the person's homestead property (in the case of a calendar year after 2007 and before 2009) for property taxes first due and payable in that calendar year, as adjusted under subsection (b).
    (b) This subsection expires January 1, 2009. This subsection applies to property taxes first due and payable in 2008. The amount of a credit to which a person is entitled under subsection (a) in a county shall be determined without including a taxpayer's property

tax liability for tuition support. Notwithstanding any other provision of this chapter, a school corporation's tuition support property tax levy collections may not be reduced because of a credit under this chapter.
    (c) This subsection applies to property taxes first due and payable in 2009. A person is entitled to a credit against the person's property tax liability for property taxes first due and payable in 2009. The amount of the credit is the amount by which the person's property tax liability attributable to the person's:
        (1) homestead exceeds one and five-tenths percent (1.5%);
        (2) residential property exceeds two and five-tenths percent (2.5%);
        (3) long term care property exceeds two and five-tenths percent (2.5%);
        (4) agricultural land exceeds two and five-tenths percent (2.5%);
        (5) nonresidential real property exceeds three and five-tenths percent (3.5%); or
        (6) personal property exceeds three and five-tenths percent (3.5%);
of the gross assessed value of the property that is the basis for determination of property taxes for that calendar year.
    (d) This subsection applies to property taxes first due and payable in 2009. Property taxes imposed after being approved by the voters in a referendum or local public question shall not be considered for purposes of calculating a person's credit under this section.
    (e) This subsection applies to property taxes first due and payable in 2009. As used in this subsection, "eligible county" means only a county for which the general assembly determines in 2008 that limits to property tax liability under this chapter are expected to reduce in 2010 the aggregate property tax revenue that would otherwise be collected by all units of local government and school corporations in the county by at least twenty percent (20%). Property taxes imposed in an eligible county to pay debt service or make lease payments for bonds or leases issued or entered into before July 1, 2008, shall not be considered for purposes of calculating a person's credit under this section.
As added by P.L.246-2005, SEC.62. Amended by P.L.162-2006, SEC.10; P.L.224-2007, SEC.38; P.L.146-2008, SEC.222.

IC 6-1.1-20.6-7.5
Calculation of credit

Effective 1-1-2009.

    
Sec. 7.5. (a) A person is entitled to a credit against the person's property tax liability for property taxes first due and payable after 2009. The amount of the credit is the amount by which the person's property tax liability attributable to the person's:
        (1) homestead exceeds one percent (1%);
        (2) residential property exceeds two percent (2%);
        (3) long term care property exceeds two percent (2%);
        (4) agricultural land exceeds two percent (2%);
        (5) nonresidential real property exceeds three percent (3%); or
        (6) personal property exceeds three percent (3%);
of the gross assessed value of the property that is the basis for determination of property taxes for that calendar year.
    (b) This subsection applies to property taxes first due and payable after 2009. Property taxes imposed after being approved by the voters in a referendum or local public question shall not be considered for purposes of calculating a person's credit under this section.
    (c) This subsection applies to property taxes first due and payable after 2009. As used in this subsection, "eligible county" means only a county for which the general assembly determines in 2008 that limits to property tax liability under this chapter are expected to reduce in 2010 the aggregate property tax revenue that would otherwise be collected by all units of local government and school corporations in the county by at least twenty percent (20%). Property taxes imposed in an eligible county to pay debt service or make lease payments for bonds or leases issued or entered into before July 1, 2008, shall not be considered for purposes of calculating a person's credit under this section.
As added by P.L.146-2008, SEC.223.

IC 6-1.1-20.6-8
Exemption from filing requirement
    
Sec. 8. Except as provided in section 8.5 of this chapter, a person is not required to file an application for the credit under this chapter. The county auditor shall:
        (1) identify the property in the county eligible for the credit under this chapter; and
        (2) apply the credit under this chapter to property tax liability on the identified property.
As added by P.L.246-2005, SEC.62. Amended by P.L.162-2006, SEC.11; P.L.146-2008, SEC.224.

IC 6-1.1-20.6-8.5
Filing requirement; qualified homestead property credit
    
Sec. 8.5. (a) This section applies to property taxes first due and payable for a calendar year after December 31, 2008. This section applies to an individual who:
        (1) qualified for a standard deduction granted under IC 6-1.1-12-37 for the individual's homestead property in the immediately preceding calendar year (or was married at the time of death to a deceased spouse who qualified for a standard deduction granted under IC 6-1.1-12-37 for the individual's homestead property in the immediately preceding calendar year); and
        (2) qualifies for a standard deduction granted under IC 6-1.1-12-37 for the same homestead property in the current calendar year.


    (b) An individual is entitled to an additional credit under this section for property taxes first due and payable for a calendar year on a homestead if the homestead qualifies as qualified homestead property for the calendar year and the filing requirements under subsection (e) are met.
    (c) The amount of the credit is equal to the greater of zero (0) or the result of:
        (1) the property tax liability first due and payable on the qualified homestead property for the calendar year; minus
        (2) the result of:
            (A) the property tax liability first due and payable on the qualified homestead property for the immediately preceding year; multiplied by
            (B) one and two hundredths (1.02).
However, property tax liability imposed on any improvements to or expansion of the homestead property after the assessment date for which property tax liability described in subdivision (2) was imposed shall not be considered in determining the credit granted under this section in the current calendar year.
    (d) The following adjusted gross income limits apply to an individual who claims a credit under this section:
        (1) In the case of an individual who files a single return, the adjusted gross income (as defined in Section 62 of the Internal Revenue Code) of the individual claiming the exemption may not exceed thirty thousand dollars ($30,000).
        (2) In the case of an individual who files a joint income tax return with the individual's spouse, the combined adjusted gross income (as defined in Section 62 of the Internal Revenue Code) of the individual and the individual's spouse may not exceed forty thousand dollars ($40,000).
    (e) Applications for a credit under this section shall be filed in the manner provided for an application for a deduction under IC 6-1.1-12-9. However, an individual who remains eligible for the credit in the following year is not required to file a statement to apply for the credit in the following year. An individual who receives a credit under this section in a particular year and who becomes ineligible for the credit in the following year shall notify the auditor of the county in which the homestead is located of the individual's ineligibility before June 11 of the year in which the individual becomes ineligible.
    (f) The auditor of each county shall, in a particular year, apply a credit provided under this section to each individual who received the credit in the preceding year unless the auditor determines that the individual is no longer eligible for the credit.
As added by P.L.146-2008, SEC.225.

IC 6-1.1-20.6-9 Version a
Option to borrow money before 2007 to replace lost revenue
    
Note: This version of section effective until 1-1-2009. See also following repeal of this section, effective 1-1-2009.


    Sec. 9. (a) This section applies only to credits under this chapter against property taxes first due and payable before January 1, 2007.
    (b) The fiscal body of a county may adopt an ordinance to authorize the county fiscal officer to borrow money repayable over a term not to exceed five (5) years in an amount sufficient to compensate the political subdivisions located wholly or in part in the county for the reduction of property tax collections in a calendar year that results from the application of the credit under this chapter for that calendar year.
    (c) The county fiscal officer shall distribute in a calendar year to each political subdivision located wholly or in part in the county loan proceeds under subsection (b) for that calendar year in the amount by which the property tax collections of the political subdivision in that calendar year are reduced as a result of the application of the credit under this chapter for that calendar year.
    (d) If the county fiscal officer distributes money to political subdivisions under subsection (c), the political subdivisions that receive the distributions shall repay the loan under subsection (b) over the term of the loan. Each political subdivision that receives a distribution under subsection (c):
        (1) shall:
            (A) appropriate for each year in which the loan is to be repaid an amount sufficient to pay the part of the principal and interest on the loan attributable to the distribution received by the political subdivision under subsection (c); and
            (B) raise property tax revenue in each year in which the loan is to be repaid in the amount necessary to meet the appropriation under clause (A); and
        (2) other than the county, shall transfer to the county fiscal officer money dedicated under this section to repayment of the loan in time to allow the county to meet the loan repayment schedule.
    (e) Property taxes imposed under subsection (d)(1)(B) are subject to levy limitations under IC 6-1.1-18.5 or IC 20-45-3.
    (f) The obligation to:
        (1) repay; or
        (2) contribute to the repayment of;
the loan under subsection (b) is not a basis for a political subdivision to obtain an excessive tax levy under IC 6-1.1-18.5 or IC 20-45-6.
    (g) The application of the credit under this chapter results in a reduction of the property tax collections of each political subdivision in which the credit is applied. A political subdivision may not increase its property tax levy to make up for that reduction.
    (h) The county auditor shall in each calendar year notify each political subdivision in which the credit under this chapter is applied of the reduction referred to in subsection (c) for the political subdivision for that year.
As added by P.L.246-2005, SEC.62. Amended by P.L.162-2006, SEC.12; P.L.2-2006, SEC.56; P.L.1-2007, SEC.44.

IC 6-1.1-20.6-9 Version b
Repealed
    
(Repealed by P.L.146-2008, SEC.810.)
    Note: This repeal of section effective 1-1-2009. See also preceding version of this section, effective until 1-1-2009.

IC 6-1.1-20.6-9.5
Effect of credit on revenues
    
Sec. 9.5. (a) This section applies only to credits under this chapter against property taxes first due and payable after December 31, 2006.
    (b) The application of the credit under this chapter results in a reduction of the property tax collections of each political subdivision in which the credit is applied. A political subdivision may not increase its property tax levy to make up for that reduction.
    (c) The county auditor shall in each calendar year notify each political subdivision in which the credit under this chapter is applied of the reduction of property tax collections referred to in subsection (b) for the political subdivision for that year.
    (d) A political subdivision may not borrow money to compensate the political subdivision or any other political subdivision for the reduction of property tax collections referred to in subsection (b).
As added by P.L.162-2006, SEC.13.

IC 6-1.1-20.6-10
Payment of debt service obligations
    
Sec. 10. (a) As used in this section, "debt service obligations of a political subdivision" refers to:
        (1) the principal and interest payable during a calendar year on bonds; and
        (2) lease rental payments payable during a calendar year on leases;
of a political subdivision payable from ad valorem property taxes.
    (b) Political subdivisions are required by law to fully fund the payment of their debt obligations in an amount sufficient to pay any debt service or lease rentals on outstanding obligations, regardless of any reduction in property tax collections due to the application of tax credits granted under this chapter. Any reduction in collections must be applied to the other funds of the political subdivision after debt service or lease rentals have been fully funded.
    (c) Upon the failure of a political subdivision to pay any of the political subdivision's debt service obligations during a calendar year when due, the treasurer of state, upon being notified of the failure by a claimant, shall pay the unpaid debt service obligations that are due from money in the possession of the state that would otherwise be available for distribution to the political subdivision under any other law, deducting the payment from the amount distributed. A deduction under this subsection must be made:
        (1) first from distributions of county adjusted gross income tax distributions under IC 6-3.5-1.1, county option income tax distributions under IC 6-3.5-6, or county economic development

income tax distributions under IC 6-3.5-7 that would otherwise be distributed to the county under the schedule in IC 6-3.5-1.1-10, IC 6-3.5-1.1-21.1, IC 6-3.5-6-16, IC 6-3.5-6-17.3, IC 6-3.5-7-17, and IC 6-3.5-7-17.3; and
        (2) second from any other undistributed funds of the political subdivision in the possession of the state.
    (d) This section shall be interpreted liberally so that the state shall to the extent legally valid ensure that the debt service obligations of each political subdivision are paid when due. However, this section does not create a debt of the state.
As added by P.L.146-2008, SEC.226.

IC 6-1.1-20.6-11
Certification of credits granted
    
Sec. 11. The county auditor of each county shall certify to the department of local government finance:
        (1) the total amount of credits that are allowed under this chapter in the county for the calendar year; and
        (2) the amount that each taxing unit's distribution of property taxes will be reduced under section 9.5 of this chapter as a result of the granting of the credits.
If the amount of credits granted changes after the date the certification is made, the county auditor shall submit an amended certification to the department of local government finance. The initial certification and the amended certifications shall be submitted to the department of local government finance on the schedule prescribed by the department of local government finance.
As added by P.L.146-2008, SEC.227.

IC 6-1.1-20.6-12
Application of credit of excise tax distribution calculations
    
Sec. 12. For purposes of computing and distributing after 2008 any excise taxes or local option income taxes for which the distribution is based on the amount of a taxing unit's property tax levy, the computation and distribution of the excise tax or local option income tax shall be based on the taxing unit's property tax levy as calculated before any reduction due to credits provided to taxpayers under this chapter.
As added by P.L.146-2008, SEC.228.