Indiana Veteran Benefits 2026: Property Tax Exemptions and Military Retired Pay Tax

The state benefits Indiana gives veterans and their surviving spouses: property tax exemptions, how the state taxes military retired pay, and other benefits, each with who qualifies, the amount, how to apply and the official source.

Indiana rewrote its disabled-veteran property tax benefits in HEA 1210-2026, effective for 2026 Pay 2027 bills: totally disabled veterans who have lived in Indiana for at least one year get a 100% deduction of the assessed value of their principal residence, with no assessed-value cap. Two flat credits replaced the old $24,960 and $14,000 deductions: $350 for wartime veterans with a service-connected disability of at least 10%, and $250 for veterans aged 62+ with a disability of at least 10%. Military retirement pay is fully deductible from Indiana income tax, including for surviving spouses. (sources)

Official sources Checked against official sources on November 4, 2026. This page lists only benefits confirmed on an official state or federal page; counties and cities may offer more.

Property tax exemptions
Military retired pay tax
Other veteran benefits
Common questions

Property tax exemptions for veterans in Indiana

Indiana property tax benefits for veterans and surviving spouses (checked November 4, 2026)
Benefit	Who qualifies	Amount	How to apply	Source
100% Disabled Veteran Deduction (IC 6-1.1-12-14, as amended by HEA 1210-2026)	Veteran with at least 90 days of service, honorably discharged, with a total disability (VA pension certificate/award of compensation or IDVA certificate; DLGF notes the statute does not say it must be service-connected). Wartime service not required. Must own (or be buying under recorded contract) and use the property as principal residence, and have resided in Indiana at least 1 year before the assessment date. No income limit; no assessed-value limit from the 2026 assessment date (the former $240,000 AV cap was removed). Surviving spouse keeps it if the veteran qualified at death; lost on remarriage. Trusts are no longer eligible. Recipients cannot also receive any IC 6-1.1-51.3 local property tax credit.	100% of the assessed value of the principal residence (DLGF safe harbor: dwelling plus up to 1 acre and qualifying residential improvements), effective 2026 Pay 2027. For a mobile/manufactured home not assessed as real property, total deductions are limited to 1/2 of its assessed value (IC 6-1.1-12-40.5).	File the Disabled Veteran Deductions/Credit form (State Form 12662) with the county auditor, completed and dated (or postmarked) by January 15 of the year taxes are first due. No annual refiling while eligible. For 2026 Pay 2027, holders of the former $14,000 deduction are auto-converted to the $250 credit and must file a new application to get the 100% deduction.	DLGF FAQ: 2026 Legislative Update
Credit for Veteran with Service-Connected Disability (IC 6-1.1-51.3-6), replaces the $24,960 deduction (IC 6-1.1-12-13) from the 2026 assessment date	Honorably discharged veteran who served during any U.S. war, with a service-connected disability of at least 10% (VA pension certificate, award of compensation or disability compensation check, or IDVA certificate). Must own or be buying the property under recorded contract. No Indiana residency requirement and no income limit. Surviving spouse qualifies if the veteran met the requirements at death.	$350 credit against local property taxes (2026 Pay 2027 onward). It can be split across parcels but not carried forward or refunded. It stacks with the $250 credit, Over 65 Credit and Blind/Disabled Credit, but not with the 100% deduction.	State Form 12662 to the county auditor by January 15 of the year taxes are first due. The statute requires an application; DLGF recommends counties auto-transfer former $24,960 deduction holders. No annual refiling while eligible.	DLGF Memo (May 27, 2026): Legislation Affecting Deductions, Credits, and Exemptions
Credit for Veteran at Least 62 with Disability of 10% or More (IC 6-1.1-51.3-5), replaces the $14,000 deduction for that group from the 2026 assessment date	Veteran with at least 90 days of service, honorably discharged, aged 62 or older, with a disability of at least 10% (VA or IDVA evidence). Wartime service not required. Must own or be buying the property under recorded contract. No residency or income limit. Surviving spouse qualifies if the veteran met the requirements at death, or was killed in action or died on active duty or inactive duty training.	$250 credit against local property taxes (2026 Pay 2027 onward). It stacks with the $350 credit, Over 65 Credit and Blind/Disabled Credit, but not with the 100% deduction.	State Form 12662 to the county auditor by January 15. For 2026 Pay 2027 it is applied automatically to anyone who held the former $14,000 IC 6-1.1-12-14 deduction.	DLGF Memo (May 27, 2026): Legislation Affecting Deductions, Credits, and Exemptions
Deduction for Homestead Donated to Disabled Veteran (IC 6-1.1-12-14.5)	Veteran with at least 90 days of service, honorably discharged, at least 50% disabled (need not be service-connected; same VA/IDVA evidence as the totally-disabled deduction), whose homestead was donated by a nonprofit organization. The DLGF May 27, 2026 memo confirms this deduction continues after HEA 1210-2026 and cannot be claimed together with the 100% disabled veteran deduction.	Deduction equal to the veteran's disability percentage of assessed value (e.g., 50%, 60%). Cannot be combined with the other veterans' deductions for the same assessment date.	File with the county auditor by January 15 of the year taxes are due.	DLGF Deductions and Credits Webinar (Oct 29, 2025)

Is military retired pay taxed in Indiana?

Indiana state income tax on military retired pay (checked November 4, 2026)
Treatment	Amount or limit	Source
Fully exempt: military retirement pay received by an Indiana resident is deductible in full (IC 6-3-2-4). Since January 1, 2025 this includes Space Force, USPHS Commissioned Corps and NOAA Commissioned Officer Corps retirement pay. The deduction also covers a surviving spouse's military survivor benefits, but not retirement pay a former spouse receives under a divorce decree. Military withholding or survivor's benefit statements must be enclosed with the return.	100% of military retirement pay, no dollar cap (Indiana DOR Information Bulletin #27, June 2025, effective for 2025 and later)	in.gov

For the dollars this treatment adds to (or saves on) a retiree’s state tax in 2026, see the military retirement tax by state study; for the pension itself, the military retirement pay calculator.

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Other Indiana veteran benefits

Vehicles and license plates

Indiana: vehicles and license plates for veterans
Benefit	Who qualifies	Amount	Source
Vehicle excise tax credit for disabled veterans without property to apply a veterans' deduction to (IC 6-6-5-5.2)	Disabled veterans (or surviving spouses) who meet the statutory requirements and do not own property to which the veteran property tax deduction can be applied. A county auditor affidavit is required.	Lesser of the vehicle excise tax or $70 per vehicle, for up to 2 vehicles	in.gov

Hunting, fishing and other licenses

Indiana: hunting, fishing and other licenses for veterans
Benefit	Who qualifies	Amount	Source
Disabled Veteran discounted hunting and fishing license (IC 14-22-12-1.5)	Indiana resident who served in the U.S. Armed Forces and has a VA-determined service-connected disability or DoD disability retirement benefits	$2.75 for a 1-year or $27.50 for a 10-year license covering small-game hunting and fishing (stamps excluded). Apply to DNR with State Form 50833.	in.gov

Education

Indiana: education for veterans
Benefit	Who qualifies	Amount	Source
Tuition and Fee Exemption (IC 21-14-4-1)	Children of Indiana veterans with wartime service (or peacetime hazardous duty recognized by a service/campaign medal) and a VA service-connected disability rating; children of POW/MIA (after Jan 1, 1960); children of Purple Heart recipients; Indiana veterans awarded the Purple Heart; former Indiana Soldiers' and Sailors' Home students	Up to 124 credit hours of tuition and regularly assessed fees at the undergraduate resident rate at state universities. For students who graduated high school in 2023 or later, up to a $5,000 grant per academic year at Indiana private nonprofit colleges. Apply via ScholarTrack and file a FAFSA each year.	in.gov

Employment

Indiana: employment for veterans
Benefit	Who qualifies	Amount	Source
Veterans' preference points in the State Merit System (IC 4-15-2-18), plus DVOP/LVER employment services through Indiana Department of Workforce Development offices	Veterans applying for merit positions or promotions in Indiana state government	Points are added to the applicant's score (the IDVA page gives no point values)	in.gov

State veterans homes

Indiana: state veterans homes for veterans
Benefit	Who qualifies	Amount	Source
Indiana Veterans' Home, West Lafayette	Honorably discharged Indiana veterans and their spouses; Gold Star parents accepted since 2018	Long-term skilled nursing, short-term rehabilitation and memory care. The page lists no rates; it points to the USDVA State Home Per Diem and CMS Spousal Impoverishment programs.	in.gov

Other benefits

Indiana: other benefits for veterans
Benefit	Who qualifies	Amount	Source
Disabled Hoosier Veteran Pass (Golden Hoosier Passport) for state parks	Persons eligible for a Disabled Hoosier Veteran license plate under IC 9-18.5-5. Former POWs receive the passport by mail after their plates are issued.	$25 per year for unlimited admission to state parks, recreation areas, reservoirs and forests (not historic sites or museums)	in.gov

Common questions

Does Indiana have a property tax exemption for disabled veterans?

Indiana lists 4 veteran property tax benefits. The main one: 100% Disabled Veteran Deduction (IC 6-1.1-12-14, as amended by HEA 1210-2026). Who qualifies: Veteran with at least 90 days of service, honorably discharged, with a total disability (VA pension certificate/award of compensation or IDVA certificate; DLGF notes the statute does not say it must be service-connected). Wartime service not required. Must own (or be buying under recorded contract) and use the property as principal residence, and have resided in Indiana at least 1 year before the assessment date. No income limit; no assessed-value limit from the 2026 assessment date (the former $240,000 AV cap was removed). Surviving spouse keeps it if the veteran qualified at death; lost on remarriage. Trusts are no longer eligible. Recipients cannot also receive any IC 6-1.1-51.3 local property tax credit.. Amount: 100% of the assessed value of the principal residence (DLGF safe harbor: dwelling plus up to 1 acre and qualifying residential improvements), effective 2026 Pay 2027. For a mobile/manufactured home not assessed as real property, total deductions are limited to 1/2 of its assessed value (IC 6-1.1-12-40.5). (DLGF FAQ: 2026 Legislative Update - Veterans Deductions and Credits).

How do I apply for the Indiana veteran property tax exemption?

File the Disabled Veteran Deductions/Credit form (State Form 12662) with the county auditor, completed and dated (or postmarked) by January 15 of the year taxes are first due. No annual refiling while eligible. For 2026 Pay 2027, holders of the former $14,000 deduction are auto-converted to the $250 credit and must file a new application to get the 100% deduction. (DLGF FAQ: 2026 Legislative Update - Veterans Deductions and Credits).

Does Indiana tax military retirement pay?

Fully exempt: military retirement pay received by an Indiana resident is deductible in full (IC 6-3-2-4). Since January 1, 2025 this includes Space Force, USPHS Commissioned Corps and NOAA Commissioned Officer Corps retirement pay. The deduction also covers a surviving spouse's military survivor benefits, but not retirement pay a former spouse receives under a divorce decree. Military withholding or survivor's benefit statements must be enclosed with the return. Amount or limit: 100% of military retirement pay, no dollar cap (Indiana DOR Information Bulletin #27, June 2025, effective for 2025 and later) (in.gov).

What other benefits do veterans get in Indiana?

Vehicle excise tax credit for disabled veterans without property to apply a veterans' deduction to (IC 6-6-5-5.2) (in.gov); Disabled Veteran discounted hunting and fishing license (IC 14-22-12-1.5) (in.gov); Disabled Hoosier Veteran Pass (Golden Hoosier Passport) for state parks (in.gov); Tuition and Fee Exemption (IC 21-14-4-1) (in.gov); Indiana Veterans' Home, West Lafayette (in.gov); Veterans' preference points in the State Merit System (IC 4-15-2-18), plus DVOP/LVER employment services through Indiana Department of Workforce Development offices (in.gov). Who qualifies and the amounts are in the tables above.

Sources

Every row above is copied from the official page linked beside it. Benefits change with new laws and local decisions, so confirm the amount and the deadline with the office that runs the program before you apply. QuantCalc is calculation software, not legal, tax or benefits advice. Last updated November 4, 2026.

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