By LISA WILKEN
Guest Columnist
This year the Indiana General Assembly changed how property tax relief for disabled veterans works, shifting it from a deduction on the value of a home to a tax credit on the final bill. On paper, that may sound like a simple adjustment.
In reality, it may leave many disabled veterans paying more.
Under the current system, a veteran who is at least 10 percent disabled, honorably discharged, and served during wartime is eligible for a $24,900 deduction from the assessed value of their home before taxes are calculated. Veterans who are totally disabled or those who are at least 10 percent disabled and age 62 or older with wartime service can receive an additional $14,000 deduction, provided their home is valued at less than $240,000.
The new system replaces those deductions with fixed credits. Veterans rated 10 percent to 90 percent disabled who were honorably discharged will receive a $350 credit on their property tax bill. Once they reach age 62, they can receive an additional $250 credit. The credit will also apply to veterans in that disability range even if they did not serve during wartime.
Meanwhile, totally disabled veterans will now receive a 100 percent exemption from property taxes, with no limit on the value of the home.
At first glance, this may appear to be an expansion of benefits. But for many veterans with 10 to 90 percent disability ratings, the math tells a different story. For a significant number of them, the new credits will not equal the value of the deductions they previously received, meaning their property taxes will actually increase, not decrease.
There is another change that may go unnoticed. Under the previous system, any unused portion of the deduction could be applied toward certain Indiana Bureau of Motor Vehicles fees, such as vehicle registration. With the shift to credits, that option disappears.
This raises an important question: did lawmakers strengthen a long-standing benefit meant to support disabled veterans, or did they unintentionally shift resources away from veterans with partial disabilities to fund a stronger benefit for those who are totally disabled?
No one would argue that totally disabled veterans deserve strong support. But the program has existed in Indiana for more than 50 years to recognize the service and sacrifices of many veterans with varying levels of disability. Any change should lift them all, not leave some paying more than they did before.
Veterans deserve clarity about whether this legislation truly expands support or simply redistributes it. When it comes to those who served our country, the difference matters.
Lisa Wilken is a U.S. Air Force Veteran from Westfield. She is a 2023 Indiana Military Veterans Hall of Fame Inductee.
Lisa, Did the governor sign the new property tax bill?
Not sure if the Governor signed it yet, but it will become law even if he doesn’t sign it.
Lisa,
Does this new law have any effect on 2025 property taxes paid in 2026?
It is for the 2026 taxes paid in 2027.
When will this change happen?
House Bill 1210 was signed by the Governor on March 12, 2026. The original deduction for veterans that was created in 1975 was very close to the new 2026 deduction. What went bad on the original is the assessed value rose from $39,000 to $240,000, but the deductions stayed the same. In 1975, Indiana honored disabled veterans with a property tax deduction of $24,950—when the average home cost just $39,000. An additional $14,000 was granted for the totally disabled. So over a period of time with the deductions staying the same and the assessed value increasing, veterans were getting less and less property tax relief. Many veterans with median incomes did not get any deductions even if they were totally disabled because their assessed value of there home was over the $240,000. The change has already happened and should be for 2026 taxes due in 2027. Hope this helps
Excellent. Thank you.
Will all veterans have to refile for the new property tax deduction?
Here is a look at the available benefits:
– 100% Deduction for Veterans with a 100% rating or IU.
– $600 Credit for 10%-90% rating, Wartime Service, and age 62+.
– $350 Credit for 10%-90% rating and Wartime Service.
– $250 Credit for 10%-90% rating and age 62+.
Surviving spouses may also be eligible for these credits.
Curtesy: https://www.linkedin.com/company/amvets-service-foundation-department-of-indiana/posts/?feedView=all