Overview of Indiana Taxes
Indiana has relatively low property taxes. The median annual property tax paid in Indiana is $1,263, which is about half that U.S. average of $2,578. The statewide average effective property tax rate is 0.81%, compared to the national effective rate of 1.07%.
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To calculate the exact amount of property tax you will owe requires your property's assessed value and the property tax rates based on your property's address. Please note that we can only estimate your property tax based on median property taxes in your area. There are typically multiple rates in a given area, because your state, county, local schools and emergency responders each receive funding partly through these taxes. In our calculator, we take your home value and multiply that by your county's effective property tax rate. This is equal to the median property tax paid as a percentage of the median home value in your county.
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Jennifer Mansfield, CPA, JD/LLM-Tax, is a Certified Public Accountant with more than 30 years of experience providing tax advice. SmartAsset’s tax expert has a degree in Accounting and Business/Management from the University of Wyoming, as well as both a Masters in Tax Laws and a Juris Doctorate from Georgetown University Law Center. Jennifer has mostly worked in public accounting firms, including Ernst & Young and Deloitte. She is passionate about helping provide people and businesses with valuable accounting and tax advice to allow them to prosper financially. Jennifer lives in Arizona and was recently named to the Greater Tucson Leadership Program.
Indiana Property Taxes
Thinking about a move to the Hoosier State? Good news: Indiana has relatively low property taxes. In fact, the average annual property tax paid in Indiana is just $1,263. This is around half the national average.
The amount you'll pay in property taxes varies depending on where you live and how much your home is worth, but the statewide average effective property tax rate is 0.81%. Homeowners who live in their primary residence in Indiana are eligible for a number of deductions that can push rates below that average, though.
Before purchasing a property in Indiana, it might be a good idea to take a look at our mortgage guide. It includes important information about mortgage rates and key details about getting a mortgage in the Hoosier State.
A financial advisor in Indiana can help you understand how homeownership fits into your overall financial goals. Financial advisors can also help with investing and financial plans, including taxes, homeownership, retirement and more, to make sure you are preparing for the future.
How Property Taxes Work in Indiana
Real estate owners in the state of Indiana must pay taxes on their property every year. Taxes can be divided into two annual installments, with one being due on May 10 and the other on November 10.
As in most other states, the Indiana property tax is ad valorem, meaning it's based on the value of property. Each county has an assessor who is responsible for an annual assessment of every property in the county. This is done through a mass appraisal that looks at general property attributes like size and year of construction, as well as the prices of recent sales in the area, in order to determine the property’s market value.
The initial assessed value, which should be equal to your home’s market value, is called the gross assessed value. Once it has been determined, deductions are applied.
The most common deduction is the Homestead Standard Deduction, which is equal to 60% of the gross assessed value up to a maximum of $45,000. It is available for owner-occupied primary residences. The Supplemental Homestead Deduction is also for owner-occupied primary residences. This is equal to 35% of assessed value (after the Homestead Standard Deduction has been applied) up to $600,000 and 25% of assessed value over $600,000.
Once deductions have been subtracted, you are left with the property's net assessed value. This is the amount to which your local tax rates are applied.
Indiana Property Tax Rates
Tax rates in Indiana are recalculated every year by local tax authorities, such as schools, counties, townships and libraries. The rates are based on the total revenue the tax authority is allowed to collect (the levy) and the total tax base (the total value of net assessed value in the district).
So, for example, if a school district can collect $1,000,000 in revenue and the tax base is $100,000,000, the tax rate will be 0.01%. That’s $1,000,000 / $100,000,000.
That 0.01% is the nominal rate, which you apply to your net assessed value (after all deductions). To know how much you are paying in terms of your home’s value, pay attention to your effective tax rate, which is your total annual taxes paid as a percentage of your home's value. The table below shows the average effective tax rates, median home values and median property tax payments for every county in Indiana.
|County||Median Home Value||Median Annual Property Tax Payment||Average Effective Property Tax Rate|
|St. Joseph County||$123,900||$1,234||1.00%|
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Marion County contains the city of Indianapolis, which is part of the reason why it's the most populous county in Indiana. It also has one of the highest effective tax rates of any Indiana county at 1.03%.
If you have questions about how property taxes can affect your overall financial plans, a financial advisor in Indianapolis can help you out.
Lake County has the highest property taxes of any county in Indiana. This is in part because of high property taxes in the city of Gary. Taking all districts and deductions into account, the average effective property tax rate in Lake County is 1.13%.
Compared to other urban counties in Indiana, Allen County has relatively low property tax rates. The median real estate tax payment in the county is just $1,147 per year, which is slightly lower than the state average.
Hamilton County sits north of Indianapolis and is one of the fastest-growing counties in the country. It also has the highest property values of any county in Indiana, with a median home value of $249,400. As a result, property tax payments are also higher. The median annual property tax payment in Hamilton County was $2,428. Tax rates are not quite as high, however. The average effective rate in the county is 0.97%.
Saint Joseph County
Some areas of Saint Joseph County have among the highest property tax rates in the state.
As a result, the average effective tax rate in St. Joseph County (median annual taxes paid as a percentage of median home value) is 1.00%. However, on a nationwide scale, this tax rate compares reasonably well to the 1.07% U.S. average.
The typical homeowner in Elkhart County pays $1,248 annually in property taxes. That's slightly below the state average ($1,263), but it's well below the national average ($2,578). Elkhart's average effective property tax rate is 0.91%. It's also 0.16% lower than the national average (1.07%).
Located in southwest Indiana, Vanderburgh County has an average effective property tax rate of 0.92%, a bit above average for the state. At this rate, if your home is worth $150,000, you would pay just $1,380 annually in property taxes. Depending on where in the county you live, however, that amount may vary.
Average 2020 property tax rates in Tippecanoe County sit at about 0.75%. Since specific rates may apply to net assessed value, homeowners who are able to claim the Homestead Standard Deduction and the Supplemental Homestead Deduction can expect to pay lower rates as a percentage of home value.
One of the most populous counties in Indiana, Porter County sits on the shores of Lake Michigan to the east of Lake County. It has one of the highest average effective property tax rates in the state at 0.98%.
The median annual property tax payment in Hendricks County is $1,754, one of the highest in the state of Indiana. That is, in part, driven by high real estate values, as it also has one of the highest median home values of any Indiana county. At the same time, Hendricks also has high tax rates, though. The average effective property tax rate in Hendricks County is 0.98%.
Places Receiving the Most Value for Their Property Taxes
SmartAsset’s interactive map highlights the places across the country where property tax dollars are being spent most effectively. Zoom between states and the national map to see the counties getting the biggest bang for their property tax buck.
Our study aims to find the places in the United States where people are getting the most value for their property tax dollars. To do this, we looked at property taxes paid, school rankings and the change in property values over a five-year period.
First, we used the number of households, median home value and average property tax rate to calculate a per capita property tax collected for each county.
As a way to measure the quality of schools, we analyzed the math and reading/language arts proficiencies for every school district in the country. We created an average score for each district by looking at the scores for every school in that district, weighting it to account for the number of students in each school. Within each state, we assigned every county a score between 1 and 10 (with 10 being the best) based on the average scores of the districts in each county.
Then, we calculated the change in property tax value in each county over a five-year period. Places where property values rose by the greatest amount indicated where consumers were motivated to buy homes, and a positive return on investment for homeowners in the community.
Finally, we calculated a property tax index, based on the criteria above. Counties with the highest scores were those where property tax dollars are going the furthest.