In a move lauded by homeowners across Indiana, State Rep. Tim O’Brien has backed significant property tax cuts and reforms that have been signed into law. According to a press release from Indiana House Republicans, the legislation—Senate Enrolled Act 1 (SEA 1)—is expected to deliver $1.3 billion in property tax savings over a span of three years starting in 2026. Reportedly, two-thirds of Indiana homeowners will see a reduction in their property tax bills compared to the previous year.
O’Brien was vocal about the pressures faced by families and local businesses, stating, “They need relief, and SEA 1 delivers it in a responsible way for all Hoosiers, without burdening local government.” The relief measures detailed under SEA 1 include a 10% property tax credit which, for all homestead property tax bills beginning in 2026, can save up to $300. Aimed at assisting those on a fixed income, seniors will receive an additional $150 credit. SEA 1 also offers relief to small businesses and farmers by exempting many from the business personal property tax, resulting in an estimated savings of about $125 million over the course of three years.
Alongside these immediate tax breaks, SEA 1 envisions long-term reforms designed to revamp the financial landscape of local governance. A notable measure is the planned reduction of the cap on total local income taxes from the present 3.75% to 2.9%, amounting to a cut of $1.9 billion in potential income for local authorities. Furthermore, SEA 1 implements stronger controls to monitor the $54.3 billion local government debt and mandates that referenda concerning taxes occur during general elections, aligning them with higher turnout rates to foster enhanced voter transparency and participation.
To bolster accountability and taxpayers’ awareness, the legislation also establishes a Property Tax Transparency Portal. This tool is envisioned to simplify for taxpayers the ability to draw comparisons between their current tax bill and any proposed tax rate changes. As SEA 1 launches into effect, Indiana’s residents can anticipate not only a more manageable tax bill in the immediate future but also a framework poised to ensure continued fiscal scrutiny and reform.
