1040-IN: Property tax deduction

Alerts and notices

Indiana allows taxpayers to claim a deduction on Schedule 2 or Schedule C for property taxes paid on primary Indiana residence. For taxpayers with Married Filing Separately status, the Indiana Department of Revenue caps the deduction at half of the maximum amount allowed for a taxpayer filing as Single or Married Filing Joint. 

Note: Taxpayers claiming the Lake County Property Tax Credit may not claim a deduction for property taxes on Schedule 2 or C.

The following information will transfer to to the Property taxes - Amounts paid (Force) statement on the INAdj screen in the Income & Adjustments folder: 

  • Amounts with code 1 from the Real Estate statement in the federal A screen in the Itemized Deductions folder.
  • The personal portion of real estate taxes you enter in the Home Office tab in the Asset module.
  • The personal portion of real estate taxes you enter in the federal 8829 screen in the Business or Farm folder.
  • The real estate taxes attributable to the personal use portion of a rental activity you enter in the Taxes statement on the federal Rent screen.
    Note: When you enter in the Code column, the total amount of taxes paid, a business use percent, and  in the State use column, the remaining portion attributable to the primary residence will transfer to the Property taxes - Amounts paid (Force) statement.

The amounts you enter at the federal level for real estate property taxes paid in 2018 are assumed to be for assessment year 2017 property taxes, payable in 2018. Indiana does not allow a deduction on the 2018 return for property taxes paid in 2018 that are attributable to an assessment year other than 2017. Use this statement to enter amounts different from the calculated amounts.