Citizen's Guide to Property Taxes
This page is intended to educate and provide helpful information regarding property taxes in Greenwood, Indiana. More information can be found by visiting the Department of Local Government Finance, Johnson County Auditor, and Johnson County Assessor's Offices.
Property Taxes in Indiana
Property taxes are a primary source of funding for local government units, including counties, cities and towns, townships, libraries and other special districts including fire districts and solid waste districts. Property taxes are administered and collected by local government officials. These funds are used to pay for a variety of services including welfare; police and fire; new construction and maintenance of buildings; local infrastructure like highways, roads and streets; and the operations, including salaries, of the local units of government.
Property taxes are an ad valorem tax, meaning that they are allocated to each taxpayer proportionately according to the value of the taxpayer's property. The statewide average revenue distribution for each property tax dollar is as follows:
(Source: Department of Local Government Finance)
Annual Property Assessment & Billing Cycle
The property tax process is also known as the property tax assessment and billing cycle. This cycle begins with the development of each property's assessed value by the county assessor. The assessor then transfers the data on each property's value to the county auditor. The auditor, after applying deductions, exemptions, and other valuation adjustments, sends these values (known as the certified net assessed values) to the Department of Local Government Finance. After thorough review, the Department converts these values to property tax rates by dividing each local unit's approved budget amounts by the assessed value for each unit. The Department forwards these rates back to the county, where the auditor and treasurer work together to calculate, generate and mail tax bills to each taxpayer. Tax bills are due to the County Treasurer on May 10th and November 10th of each year.
To look up past taxes due and paid visit Johnson County Beacon property search tool.
(Source: Department of Local Government Finance)
Annual Budget & Levy Adoption Cycle
Property taxes represent a property owner's portion of the local government's budgeted spending for the current year. Increases or decreases depend upon a local government's fiscal management, the assessed valuation of a property and/or local tax rates, which are based on the budget proposals submitted by local government taxing entities that provide services to each community. (i.e. taxing district)
Local spending is one of the primary drivers for property tax rate increases or decreases. Each year, the City of Greenwood Common Council and other applicable local unit's fiscal bodies responsible for adopting a budget, rates, and levies submit their adopted budget to the Department of Local Government Finance ('"DLGF"). The DLGF then reviews each unit's budget and ensures that the budget is in line with laws, regulations, and other property tax controls related to this spending. After the unit makes any necessary adjustments, the DLGF approves a final budget and develops tax rates for each taxing unit and district. This rate becomes the effective rate applicable to an assessed value of property. Ultimately, it is the cumulative change in assessed value, eligible deductions, levies adopted, and district tax rates that drive a particular property's tax bill.
For more information on the City of Greenwood's budget please see the Council Budget Report, Citizens Budget, or 2022 Adopted Line-item Budget.
Property Tax Caps (Circuit Breaker Tax Credits)
In 2008, Indiana passed property tax caps that limit an owner’s property tax burden to a fixed percentage of the property’s gross assessed value. The limit varies across three classes of property at rates of 1% (class 1 – residential homestead), 2% (class 2 – nonhomestead residential and farmland), and 3% (class 3 – commercial and industrial).
When tax bills exceed the property tax cap limit, taxpayers receive a circuit breaker credit that is a tax savings to the payer but a revenue loss to their local government service providers. The share of the circuit breaker credit is proportionally paid by the units within a tax district based on their unit's share of the cumulative tax district rate.
(Source: DLGF, IU School of Public & Environmental Affairs.)
Residential Homestead
(Owner-occupied)
Total amount of gross assessed value of all City of Greenwood property that is limited to the 1% property tax cap. The gross amount is before any specific property deductions.
Residential Rental & Farm
(No Homestead)
Total amount of gross assessed value of all City of Greenwood property that is limited to the 2% property tax cap. The gross amount is before any specific property deductions.
Commercial Office, Retail, Industrial, & Other
Total amount of gross assessed value of all City of Greenwood property that is limited to the 3% property tax cap. The gross amount is before any specific property deductions.
Tax Rates by Tax District
What Tax District am I in?
Below is an interactive GIS map that allows you to see the various taxing districs across the City of Greenwood. Each taxing district is represented by a different three-digit numeric number. There are different taxing districts because different areas across the City have different school, library, fire service, and other special districts serving the area. Another way to identify which district you are in is to look up your tax parcel identification number. The last three digits of the parcel also identify which taxing district a property falls within.
Click on the three dots on the upper-right to view the legend. (Hint: search by address or zoom in features enabled)
Estimating My Property Tax Bill
Once you have located your specific tax district three-digit code, you can use online tax estimators to assist in planning. The DLGF has a tool available here that is very useful as it takes into consideration the current tax rates for your district, specific property deductions, referendum impacts, and factors in the property tax cap for your property. This tool is helpful for new homeowners and as new businesses looking to expand or grow in Greenwood. Once you open the tool, simply select the county, tax district, and input your property specifics to estimate your tax bill.
Additional Taxpayer Resources
Glossary of Terms
Below is a list of the commonly used terms referenced in the property tax assessment and budgeting process as defined by the Department of Local Government Finance of Indiana.
Annually Adjusting Property Values
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 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 current market value-in-use.
Assessment
The official act of discovering, listing and appraising property for ad valorem tax purposes. “Ad valorem” tax refers to any tax imposed on the basis of the monetary value of the taxed item. In Latin, the term literally means “according to value.”
Assessed Value (AV)
The total dollar value assigned to all real property and improvements and personal property subject to taxation. Locally elected assessors determine property values with assessment guides prescribed by the Department of Local Government Finance. These values may be changed by the county’s Property Tax Assessment Board of Appeals. The Department of Local Government Finance assesses certain public utilities.
Budget Order
The budget order is a critical document in calculating tax bills. The order contains the state’s certification of budgets, tax rates, and tax levies for each taxing unit in a county. The order also documents the total tax rate and the local homestead credit rate for each taxing district.
Circuit Breaker
The means by which no more than a certain percentage of a property’s assessed value is paid in taxes. The percentage represents the “cap” for property taxes on the property. If the taxes for a property exceed the cap percentage, a property tax credit is issued for the dollar amount above the cap. The actual property tax to be paid would then equal the dollar amount of the property’s gross assessed value multiplied by the circuit breaker percentage cap. For example, if a property with a gross assessed value of $100,000 has a tax bill of $2,100 and the circuit breaker percentage cap is 2%, a tax credit in the amount of $100 would be issued for that property, thereby reducing the property tax amount due to $2,000 or 2% of its gross assessed value.
Deduction
A property tax benefit that reduces the assessed value of property. There are a number of property tax deductions available to Indiana taxpayers. Detailed information may be found on this website under the “Information for Taxpayers” section.
Exemption
A property tax benefit that excludes a property from taxation and, in some cases, assessment.
Homestead Deduction
The homestead deduction is the most commonly used property tax deduction in Indiana. It allows a homeowner who uses a property as his or her principal place of residence to qualify for a deduction of the lesser of 60% of the gross assessed value of the property or $45,000. This deduction potentially lowers the taxpayer’s property tax obligation. A taxpayer receiving a Homestead Standard Deduction is also entitled to receive a Supplemental Homestead Deduction. The amount of the Supplemental Homestead Deduction is 35% of the assessed value remaining after application of the Homestead Standard Deduction that is less than $600,000 and 25% of the remaining assessed value that is more than $600,000.
Levy
The product of a specified tax rate and the assessed value. Levy terminology includes “maximum levy” and “excessive levy.”
Property Tax Levy
The property tax levy is the amount of money that a taxing body requires to be collected through the property tax system.
Property Tax Rate
A percentage applied to each taxing unit’s assessed valuation that will produce the amount of that taxing unit’s levy or, in other words, the product of dividing the levy by the assessed value. The tax rate is expressed in terms of “dollars per $100 of assessed value.”
Real Property
The interests, benefits, and rights inherent in the ownership of land and anything permanently attached to the land or legally defined as immovable.
Referendum
The local public question process generally applies to controlled projects and school operating referenda (for school corporations that need additional revenue to operate or offset circuit breaker losses). The referendum process can also be used in local government reorganizations.
Trending
The process whereby property values are adjusted (the adjustment can be positive or negative) on an annual basis to bring them closer to market value-in-use. The assessing official uses sales of properties in a neighborhood, area, or class of property from the previous 14 months to determine the adjustment factor. In the past, the assessed values of real property were adjusted only after a reassessment, which occurred as far apart as ten years. Unlike reassessments, trending occurs every year.
Taxing District
This is the term for the geographic area within which taxing units have the authority to fund themselves via property taxes.
Taxing Unit
An entity that has the power to impose ad valorem property taxes. Examples include counties, cities, towns, townships, and school corporations.