Marion County's fall property tax installment is due November 10. For a lot of Indianapolis rental owners, it's the second half of the biggest tax bill they've paid on the property. I'm one of them.
Here's why bills rose, how to check whether yours is right, and what to do before the due date.
Why rental tax bills jumped
Indiana's Department of Local Government Finance removed a sizeable adjustment that assessors had applied to apartment values, starting with the January 1, 2025 assessment date. Those assessments set the bills paid in 2026. In Marion County, the assessor added nearly $2 billion of assessed value to about 1,000 apartment complexes with 20 or more units, according to Faegre Drinker.
Smaller rentals took hits too. In Marion County the tax bill serves as the official assessment notice, so for most owners the spring bill was the first sign.
Mine came in April. I have a short-term rental in Butler-Tarkington. When I bought it, the taxes were about $1,800 a year. My 2026 Marion County bill was $6,275, and $951 of that was special assessments.
How Indiana's 2% cap works on a rental
Indiana caps property taxes as a percentage of gross assessed value. Rentals fall in the non-homestead residential bucket, capped at 2%. A home you live in is capped at 1%, and commercial property at 3% (DLGF circuit breaker fact sheet).
| Gross assessed value | Most you should owe in a year at the 2% cap | Fall installment (half) |
|---|---|---|
| $150,000 | $3,000 | $1,500 |
| $200,000 | $4,000 | $2,000 |
| $250,000 | $5,000 | $2,500 |
One exception: taxes from voter-approved referendums, such as school referendums, sit outside the caps. If your bill runs above 2% of assessed value, a referendum levy is the first thing to look for.
There's also a new break. Starting with bills paid in 2026, Indiana applies a deduction to 2% cap property, rentals included, equal to 6% of assessed value, and it grows each year through 2031 (DLGF 2025 legislative update). It's applied automatically, so check that it shows on your bill.
What to do before November 10
- Run the 2% check. Find your gross assessed value on your bill and multiply by 0.02. Compare that to your annual tax, leaving out referendum levies. Special assessments, like the $951 on mine, are listed as their own lines, so look at those separately. A big gap above the cap is worth a call to the Marion County Treasurer.
- Pay on time. Indiana charges a 5% penalty if you pay within 30 days of the due date and owe no other delinquent taxes on the parcel. Otherwise it's 10%. See the DLGF due dates page.
- Check your escrow. If your lender pays the taxes, a higher bill usually means an escrow shortage and a higher monthly payment after the next escrow review. Plan for it now.
- Re-run the numbers on every door. A $1,000 a year increase is about $83 a month. On a single-family rental clearing $250 a month, that's a third of the cash flow. My Butler-Tarkington bill went up about $4,475 a year, roughly $373 a month.
- If you live in one unit, ask about the homestead deduction. If you live in one unit of a 2 to 4 unit building, ask the Marion County Assessor whether your part of the property qualifies for the homestead deduction and the 1% cap, and confirm the deduction is on file.
Mark the next appeal window
The deadline to appeal assessments billed in 2026 was June 15. For next year, review your spring bill the week it arrives, since it doubles as your assessment notice.
If you're weighing an appeal on a larger property, the newer, bigger assessments are where a property tax attorney often pays for themselves.
What this means if you're buying
Underwrite every Marion County rental with the current bill, and treat the listing's tax figure as out of date until you check it. Use 2% of the expected assessed value as your planning number, then add any referendum levy for that taxing district.
I've been watching holding costs climb for a while. In early 2025 I wrote that taxes, insurance and interest had "risen tremendously," and that I was selling off two single-family rentals because of holding costs. This year I refinanced two investment properties from 7.25% to 6.5% to get cash flow back. My rule for what I buy now is the same one I give clients: buy on value, look for deals with equity built in, and don't count on appreciation to fix a deal that doesn't work at today's tax bill.
For local tax rates by township, see our Marion County property tax rate guide. Buying a home to live in? Start with Marion County property taxes for buyers. We cover the rest of the investor tax picture in Indianapolis property taxes for real estate investors. If you want help running a specific deal, start on our invest page.
Sources
Frequently asked questions
Quick answers from this guide.
When is the Marion County fall property tax installment due?
November 10, 2026. For a lot of Indianapolis rental owners it is the second half of the biggest tax bill they have paid on the property.
Why did Indianapolis rental property tax bills go up?
Indiana's Department of Local Government Finance removed a sizeable adjustment that assessors had applied to apartment values, starting with the January 1, 2025 assessment date. Those assessments set the bills paid in 2026. In Marion County, the assessor added nearly $2 billion of assessed value to about 1,000 apartment complexes with 20 or more units, according to Faegre Drinker. Smaller rentals took hits too.
What is the property tax cap on a rental in Indiana?
Indiana caps property taxes as a percentage of gross assessed value. Rentals fall in the non-homestead residential bucket, capped at 2%. A home you live in is capped at 1%, and commercial property at 3%.
Do referendum taxes count toward the 2% cap?
No. Taxes from voter-approved referendums, such as school referendums, sit outside the caps. If your bill runs above 2% of assessed value, a referendum levy is the first thing to look for.
How do I check whether my rental tax bill is right?
Find your gross assessed value on your bill and multiply by 0.02. Compare that to your annual tax, leaving out referendum levies. Special assessments are listed as their own lines, so look at those separately. A big gap above the cap is worth a call to the Marion County Treasurer.
What is the penalty for paying Marion County property taxes late?
Indiana charges a 5% penalty if you pay within 30 days of the due date and owe no other delinquent taxes on the parcel. Otherwise it is 10%.
Is there a new property tax deduction for rentals in Indiana?
Starting with bills paid in 2026, Indiana applies a deduction to 2% cap property, rentals included, equal to 6% of assessed value, and it grows each year through 2031. It is applied automatically, so check that it shows on your bill.
Can I still appeal my Marion County rental assessment?
The deadline to appeal assessments billed in 2026 was June 15. For next year, review your spring bill the week it arrives, since it doubles as your assessment notice.