Dear fellow landlords,

As with many expenses, property taxes continue to rise year after year, often reaching record highs. I’m reaching out to ask for your advice and experiences regarding how to appeal a property tax assessment on a rental property.

For example, one of our properties generates about $1,500 per month in rent (we do not overcharge), yet its assessed value has climbed to approximately $250,000. In Indiana, that translates to a tax liability of nearly 2% of the assessed value—an increasingly unsustainable burden.

If you’ve gone through the appeals process or have any tips or strategies to share, I would greatly appreciate your input.

Thank you in advance for your time and insight.

Best regards,

In Indiana appealing is easy. Winning is not always as easy. I have no idea what your situation is and I am no expert but my first step would be checking your property record card to be sure all the info is correct. Check that there are no structures or pools or porches that have been removed but still on the record card. Next would be asking for the assessor to compare the current assessment to using the Gross Rent Multiplier. They will use your rents to calculate a value based on a super secrete equation. Next Check with zillow and look for sales of homes in the year of the assessment and see if your assessment is close to market value. Determine if your assessment is off and if so fill out a form 130 and turn it in to start the appeal. The easiest way I have found to win an appeal is to submit a Tax Appraisal completed by a certified tax appraiser. If you don't want to go to that expense you will need some proof of your value if the GRM doesn't get you where you want be. Maybe a Realtor could pull comparable sales for you that prove your number. The first step is the assessors office and they will try to come to an agreemenet if you don't agree then it goes to the board and you gotta know your numbers and have solid proof if you go to the board. You are correct some counties go straight to the 2% or 3% cap and then if there is a referendum that amount is over and above the cap. Good luck

Check with the paperwork they sent you on the latest notice that comes before the tax bill or on the bill itself. It should give info there.

Here there is a very small window, 2 weeks in March I think, where you can appeal. You have to make an appointment and bring supporting info for your argument. Even when you do that there is low probability you will be successful.

The value of property has been going up in many areas. (Around here it has doubled in less than 4 years.) So assessments keep going up. This automatically raises the taxes because they are tied to the assessments. When Calif passed Proposition 13 years ago it limited increases to a small percentage yearly but the assessments moved to market rate if the property was sold. Even in the 80's I knew young people who were paying $40,000 a year in property taxes on ONE house.

The local govt kept saying it was necessary because wages and expenses had to keep pace with inflation, etc. (Many of us were of the opinion that the govt was hiring all their relatives and friends and giving them fat paychecks and unlimited benefits for life. Not to mention the trips to exotic places for "meetings and conferences" regarding how to raise more tax money.) A week in Hawaii, Vegas, Bali or the Greek Isles every other month for "strategy and fact finding" at taxpayers expense is needed, in their opinion, especially when you can take family and friends (co-workers) along.

So what can we do to prove our property was over assessed? Keep it in poor looking shape? That's probably not a very good option as it leads to more repairs later which can be more than the money you might save. Do the same kind of research the assessor is supposed to do and choose comparable places that fit your argument? (It's been said by some that assessors sometimes choose higher value places for comparison just to raise your properties value, but they deny this). Even if you prove it, all they do is adjust your property value, not penalize the assessor. Then next year it might go right back up or somehow, because you did this, every one of your properties goes up - funny how that happens, you might think. You could make friends with the assessor and maybe get some breaks that way but that's low probability, and maybe unethical. You can also just sell the place and invest somewhere else where it is more favorable or in different types of property like farmland or timber for example where the taxes are lower.

If we stay in residential rentals, there's not a lot we can do. So we pass the increases along to the tenants. The tenants get angry and call us names and lobby the govt to favor them. Since there are more tenants than landlords, the govt often sides with the tenants. We see constantly more and more reports of anti landlord laws and rules. It's so bad in some states that many of us just won't do business there.

I don't know any solution, especially long term solutions. What do we do when socialists, tenants, and the govt are all in lockstep in a never ending dance to advantage themselves at our expense? I think we are just about at a breaking point because most tenants simply cannot afford rising rents. Here a one bedroom newer place starts at $1250 a month. 3 bedrooms are $1850. In larger cities the prices are even more. Wages have not kept up - in fact they are decades behind. Most people are in crippling debt with little savings. Only the retired boomers who own their homes they bought long ago are even close to making it work and that's because they bought long ago and stayed married. Those who got divorced or are alone are also generally struggling. We have become a nation of debtors driven by advertising to consume beyond our means. As just one example of proof, I look at the mile long line of vehicles lined up for the free food distribution they have in town each month and I see many, no-most of the vehicles in line are newer. I see $60,000 pickup trucks in a free food line, SUV's and trucks that have an average payment of over $700 a month plus insurance. The local restaurants are full every weekend and holiday and even on many regular days when the cost of a meal has topped $25 as a minimum per plate plus drinks. Where it used to be $5 or $6.00 a plate when I was younger, now it's more like $40 with one drink and a dessert. Plus tip. It takes 2 full time incomes to make rent and everyday expenses. The family as a cohesive unit has been eroded and destroyed since the mid 60's when it was pushed that the ladies should join the workforce en masse. Kids were no longer raised by parents but rather by others and by school programs. The rise of pre kindergarten (so the wife could go to work) took the parents out of the raising family equation and substituted "others" to raise and train our kids with their values, not ours.

It sounds like this is a residential property. Rents don't matter when assessing those. Comparable sales do. So first step, you need to research your market and find out what comparable properties (within 1/4 miles, actual sales, not just listings) are.

I don't know your market, so I have no idea what you'll find. But MANY of us have found that the assessments are finally getting around to reflecting the massive increase in property values from 2021- 2023. Most of us saw our values climb 20-50%. The tax authorities are slower on the uptake, so now those higher values are being reflected. Even so, in my town properties are often appraised at LESS than their true market value, so any attempt to appeal might get me a tax INCREASE.

Same is true with insurance. The cost to rebuilt has shot through the roof, so it's not a surprising that insurance rates are going up 10-20% per year.

It's always fun to see your properties increase in value... until the correlated bills start showing up. Taxes, insurance, maintenance... all costs are going up to reflect the gain in value.

Sid's advice is good. I went through the process once. FEMA redid the local flood maps and part of my property was put into the 100 year flood plain. I filed for a value reduction based on this. I was denied.

You need to have proof your valuation is incorrect. Comparable properties selling for less is proof.

J sums it up pretty well. You can get Form 130 (PDF) on the in.gov website. You don't need to present your evidence with Form 130. Just fill it out and send it in. A subsequent meeting with a Property Tax Board of Appeals is where evidence is presented.

Rents DO matter in Indiana for property taxes.

J is correct that they have a super secret calculation they use to decide when it is a rental. This has always made my taxes lower, although sometimes they want a copy of the lease or your taxes on the place. Umm, no thanks.

Rental properties in IN are supposed to be capped at 2%. They always just seem to raise the value of the property to make more tax money.

I have one property that I am selling on contract that went up 41% over last year. All I can say is that it looks nicer with the new siding, which has been ongoing for the last three years. (Buyer is doing it)

I appealed a place last year. They worked out the GRM calculation and the taxes dropped a lot. Then this year the same place is assessed for more so the taxes climbed again.

One local school system has a referendum they are trying to pass that will literally double the property taxes on all residential homes, rentals or not.

Used to be I could get my realtor to run comps for me. Now I do not do that as people are selling for stupid high prices and unfortunately that raises everything around us. So I get dinged because I decided to hold my properties.

Like others said, check the paperwork notice from CAD about your new tax appraisal. Follow the instructions to protest. Do it IN PERSON, never do it online. To easy for them to hold to their appraisal. Face to face works. Remember, there may be a difference between actual appraised value and taxable appraised value which is either same or less. What you'll be arguing for is the actual appraised value. If you can't get that amount below the taxable appraised value then you've slowed future appraisal creep, but you will still be paying the same amount. Long-term, it will save you money, but short term, you're not doing much. Pray for a crash.

Another thing, if you protest in person every year, you'll get to know the appraiser. Ask them what they look for and how they evaluate properties. My home is hard to comp. Not many sales per year in my area. So I found out from them which neighboring subdivisions in my county do they consider comps. Found out I'm judged on 3 neighborhoods. Some years, there's only one sale per year. If asked, they will provide you notes on their comps. It's mostly code and hard to understand, but it does have the addresses of the comps considered. That's more important. Judge for the age, size, lot size, etc. when making adjustments comparing your house to the comps.

Above all, be really friendly. This may be your appraiser for the life of owning your home. So don't go in there all huffy like he/she is stealing your money. I've heard appraisers mention getting yelled at by others.

Helps if you have "reason" to initiate the dispute. Like my neighbors place is HALF my assessment ... or I don't have 3 fireplaces like the property card says I do.