Due Date: March 1, 2024
As part of the Annual Adjustment process, counties are responsible for submitting a ratio study and uniformity for all classes of property in all townships. The ratio study measures the accuracy and equity of assessments. It is determined by the formula: Assessed Value/Sale Price = Ratio. The assessment ratio for all properties in Indiana is to be 100%.
The accuracy of assessments refers to how close the assessments determined by local assessing officials are to market value-in-use.
See County Specific Information for your county’s Ratio Study.
The equity of assessments refers to how uniform assessments are within a class of property or geographic area. It is measured by the Coefficient of Dispersion or the relative dispersion or variability of assessments from the median. For improved residential property, it should be 0=<15%. For all other classes of property, it should be 0=<20%.
The ratio studies are submitted by the county to the Department, which reviews and approves the submitted ratio studies.
- Annual Adjustment Process - Annually adjusting property values is part of Indiana's move to a market-based assessment system that began in 2002. Similar market-based assessment systems are currently being used in 48 other states.
The annual adjustments are calculated by comparing the prior year's assessment with current sales data from a neighborhood. The difference, positive or negative, will be used to create a factor that assessing officials will apply to the property's assessed value to bring it to its current market value.
Under the old system, real estate was generally only reassessed every 10 years, which left taxpayers with a large change in their assessments every decade. Annual adjustments curb that large lump sum change in assessments by annually adjusting values based on sales.
- Assessment - The official act of discovering, listing, and appraising property for ad valorem tax purposes. “Ad valorem” tax refers to any tax imposed based on the monetary value of the taxed item. In Latin, the term means “according to value.”
- Accuracy - It is measured by the median or average level of assessment for a class of property. For any class of property in a township, it should fall between 90% and 110%.
- Market Value - The most probable price, estimated in terms of money, which a property would bring in a sale between a willing buyer and seller under arms-length conditions, in an open market with adequate market exposure and reasonable marketing time.
- Equity - This is measured by the coefficient of dispersion (COD). The COD should be 0=< on improved residential property and 0=<20% on all other classes.
- Coefficient of Dispersion - The relative dispersion or variability of assessments from the median. For improved residential property, it should be 0=<15%. For all other classes of property, it should be 0=<20%.
- Price Related Differential (PRD) - This tells whether low-value properties in a class are over- or under-valued in relation to high-value properties.
- Regressivity/Progressivity - The PRD for any class of property in a township should be between .98 and 1.03.