Marion County's Over-65 Deduction in 2026: Indianapolis Senior Homeowner Walkthrough

The Over-65 Property Tax Deduction is one of the more meaningful benefits available to senior homeowners in Indiana. For a qualifying Marion County resident, it can reduce taxable assessed value by up to $14,000 and, paired with the Over-65 Credit, cap year-over-year tax increases at 2%. SB 1 didn't restructure these benefits, but it did expand the broader homestead deduction in ways that affect how the Over-65 math plays out in 2026.

This is a step-by-step walkthrough for Indianapolis senior homeowners — eligibility, the math at typical Marion AVs, how to file with the Marion County Auditor, and the mistakes that cause seniors to leave money on the table.

What the Over-65 Deduction does

Indiana provides two distinct benefits for senior homeowners, often confused. They stack:

Over-65 Deduction (IC 6-1.1-12-9)

Reduces taxable AV by the lesser of:

$14,000, or
50% of the assessed value of the homestead.

Applied before the tax rate calculation. For a typical Marion homestead with $200K AV, this is a $14,000 AV reduction, which translates to roughly $400–$600 in annual tax savings depending on district rate.

Over-65 Circuit Breaker Credit (IC 6-1.1-20.6-8.5)

Limits the annual growth of property tax on the qualifying homestead to 2% per year. Applied after the tax is calculated. Stops the tax bill from rising more than 2% above the prior year's bill, even if AV or rates grow faster.

The Credit is far more valuable in years of rapid AV growth than the Deduction itself.

Note

The two are separately filed and have different eligibility rules for income. Filing one does not automatically file the other. A meaningful share of Marion seniors qualify for both but file only one.

Eligibility

Over-65 Deduction

Owner (or surviving spouse) is 65 or older by December 31 of the assessment year (i.e., December 31, 2026 for the 2026 assessment)
Adjusted gross income of the individual + spouse + any other co-occupant filer was $30,000 or less for the individual, OR $40,000 or less combined for the household
Assessed value of the property (after the standard and supplemental deductions) is $240,000 or less
Property is the applicant's principal place of residence
Applicant has owned the property (or a beneficial interest in a contract) for at least one year

Over-65 Circuit Breaker Credit

Owner is 65 or older by December 31
Adjusted gross income: $30,000 or less individual, $40,000 or less combined
Assessed value (gross, before deductions) is $200,000 or less — this threshold is stricter than the Deduction
Property is principal residence and has been for at least one year

The AV threshold is the most common reason Marion seniors fail to qualify for the Credit. In an environment of rising AVs, a senior who qualified in 2023 may exceed the $200K gross AV threshold by 2026.

The math for a typical Indianapolis senior

Take a representative Center Township senior homeowner: $180K gross AV in 2026, $25K household income, single.

Without Over-65 benefits:

Step	Value
Gross AV	$180,000
Standard homestead deduction	−$48,000
Supplemental deduction (~40%)	−$52,800
Net AV after deductions	$79,200
Composite Center / IPS rate	$4.30 / $100
Calculated gross tax	$3,406
1% homestead cap on $180K	$1,800
Tax owed (cap binds)	$1,800
SB 1 $300 homestead credit	−$300
Net bill	$1,500

With Over-65 Deduction added:

Step	Value
Net AV after standard + supplemental	$79,200
Over-65 deduction (lesser of $14K or 50% AV)	−$14,000
Net AV after Over-65	$65,200
Composite rate	$4.30 / $100
Calculated gross tax	$2,804
1% homestead cap on $180K	$1,800
Tax owed (cap binds)	$1,800
SB 1 $300 homestead credit	−$300
Net bill	$1,500

In this scenario the Over-65 Deduction doesn't change the bill — because the cap already binds at $1,800. This is the key insight for Marion seniors in cap-bound townships: if the cap binds your bill, the Deduction's AV reduction has no marginal benefit.

With Over-65 Circuit Breaker Credit added (instead of, or alongside, the Deduction):

If 2025's bill was $1,470 and the 2026 bill before the Credit would be $1,500, the Credit caps the 2026 bill at $1,470 + 2% = $1,499 — saves $1.

But in a year of bigger AV growth (say 2027 with the bill rising 8% to $1,620), the Credit caps it at the prior year + 2% = $1,470 × 1.02 = $1,499.40. Saves ~$121.

Combined value over a 5-year hold with rising AVs: the Credit is the bigger benefit. The Deduction is helpful in non-cap-bound districts.

Where the Deduction matters most

Decatur, Franklin, and Perry townships have lower composite rates. Many homestead parcels there are not cap-bound — the gross tax calculation produces a number lower than 1% of gross AV. In those districts, the Over-65 Deduction reduces net AV and therefore the gross tax calculation, which is the actual bill.

Take a Decatur Township senior with the same $180K AV:

Step	Value
Gross AV	$180,000
Net AV (post deductions)	$79,200
Composite Decatur / MSD Decatur rate	$3.10 / $100
Calculated gross tax	$2,455
1% cap	$1,800
Tax owed (gross tax binds; below cap)	$2,455
Wait — gross tax > cap; cap binds	$1,800

Actually the cap still binds here too. Let's adjust to a higher-AV senior to find a non-cap-bound case: a $400K Decatur senior:

Step	Value
Gross AV	$400,000
Standard + supplemental	−$208,000
Net AV	$192,000
Decatur rate	$3.10 / $100
Gross tax	$5,952
1% cap	$4,000
Cap binds	$4,000

The $400K senior doesn't qualify for the Over-65 Deduction anyway (over the $240K AV threshold post-deduction). So in practice, most Marion seniors who qualify for the Deduction are cap-bound — the Credit is the more meaningful benefit.

How to file with the Marion County Auditor

The Over-65 Deduction and Credit are filed with the Marion County Auditor (not the assessor; not the township).

What to file

Form HC10 (Over-65 Deduction) — application
Form HC10-D (Over-65 Circuit Breaker Credit) — separate application, same supporting documents
Proof of age — birth certificate or driver's license
Proof of income — most recent IT-40 (Indiana income tax return) or federal return
Proof of ownership — deed or title document (if not already on file)

When to file

For 2026 taxes (Jan 1, 2026 assessment date, payable May/November 2027), the deadline is December 31, 2026. Filing earlier is fine; the deduction becomes effective for the assessment year regardless of filing date within the calendar year, as long as eligibility is established.

If you turned 65 in 2026, file in 2026. If you've been 65 for years and never filed, file now — you can apply prospectively, but you cannot retroactively recover past years.

Where to file

In person: Marion County City-County Building, Auditor's Office, 200 E. Washington Street, Indianapolis
Mail: Marion County Auditor, 200 E. Washington St., Suite 841, Indianapolis, IN 46204
Online: Marion County Auditor's portal (varies by tax year)

Common mistakes Marion seniors make

Only filing one of the two. The Deduction and Credit have similar applications but are filed separately. Many seniors complete one and assume the other was included. Verify both are on your bill.
Not refiling after a spouse's death. If both spouses qualified and one passes, the surviving spouse must verify the benefits transferred. They usually do under Indiana law, but verify with the Auditor.
Income threshold drift. Required minimum distributions from retirement accounts can push a senior past the $30K/$40K threshold. Check your most recent IT-40 against the threshold annually.
Letting the AV grow past the Credit threshold. As AVs rise, a Marion senior with a $190K AV may cross the $200K Credit threshold within a year or two. If so, the Credit stops applying — the Deduction continues if AV is under $240K post-deductions.
Not appealing AV. If your AV grew rapidly, filing a Form 130 may keep you under the Credit's AV threshold.

What to do this week

Confirm your age and income against the thresholds above.
Pull your most recent Marion tax bill and check for "Over-65 Deduction" and "Over-65 Credit" line items. If either is missing, you're not claiming it.
File Form HC10 and HC10-D with the Marion County Auditor if you haven't.
If your AV is near the $200K threshold, consider whether a Form 130 appeal would preserve your Credit eligibility for future years.
If you're approaching 65 in the next year, file the year you turn 65.