2023 Indiana Code › Title 6. Taxation › Article 1.1. Property Taxes › Chapter 4. Procedures for Real Property Assessment › 6-1.1-4-39-b. Assessment of Rental Property and Mobile Homes; Low Income Rental Housing Exclusion; Appraisal Approach; Burden of Proof

Note: This version of section effective 1-1-2024. See also preceding version of this section, effective until 1-1-2024.
Sec. 39. (a) For assessment dates after February 28, 2005, except as provided in subsections (c) and (e), the true tax value of real property regularly used to rent or otherwise furnish residential accommodations for periods of thirty (30) days or more and that has more than four (4) rental units is the lowest valuation determined by applying each of the following appraisal approaches:
(1) Cost approach that includes an estimated reproduction or replacement cost of buildings and land improvements as of the date of valuation together with estimates of the losses in value that have taken place due to wear and tear, design and plan, or neighborhood influences.
(2) Sales comparison approach, using data for generally comparable property.
(3) Income capitalization approach, using an applicable capitalization method and appropriate capitalization rates that are developed and used in computations that lead to an indication of value commensurate with the risks for the subject property use.
(b) The gross rent multiplier method is the preferred method of valuing:
(1) real property that has at least one (1) and not more than four (4) rental units; and
(2) mobile homes assessed under IC 6-1.1-7.
(c) A township assessor (if any) or the county assessor is not required to appraise real property referred to in subsection (a) using the three (3) appraisal approaches listed in subsection (a) if the assessor and the taxpayer agree before notice of the assessment is given to the taxpayer under section 22 of this chapter to the determination of the true tax value of the property by the assessor using one (1) of those appraisal approaches.
(d) To carry out this section, the department of local government finance may adopt rules for assessors to use in gathering and processing information for the application of the income capitalization method and the gross rent multiplier method. If a taxpayer wishes to have the income capitalization method or the gross rent multiplier method used in the initial formulation of the assessment of the taxpayer's property, the taxpayer must submit the necessary information to the assessor not later than the assessment date. However, the taxpayer is not prejudiced in any way and is not restricted in pursuing an appeal, if the data is not submitted by the assessment date. A taxpayer must verify under penalties for perjury any information provided to the township or county assessor for use in the application of either method. All information related to earnings, income, profits, losses, or expenditures that is provided to the assessor under this section is confidential under IC 6-1.1-35-9 to the same extent as information related to earnings, income, profits, losses, or expenditures of personal property is confidential under IC 6-1.1-35-9.
(e) The true tax value of low income rental property (as defined in section 41 of this chapter) is not determined under subsection (a). The assessment method prescribed in section 41 of this chapter is the exclusive method for assessment of that property. This subsection does not impede any rights to appeal an assessment.
(f) Notwithstanding IC 6-1.1-4-4.5, for assessment dates beginning after December 31, 2023, the county assessor or township assessor making the assessment shall perform an assessment of property qualifying under subsection (a) annually, and for each assessment year, perform a valuation of the property qualifying under subsection (a) using each of the appraisal approaches in subsection (a)(1) through (a)(3) and annually report to the taxpayer each of the values under those approaches as determined by the assessor on a form as prescribed under subsection (i). The assessor shall use the department cost schedules without modifiers, adjustments, or other trending factors.
(g) The county assessor or township assessor making the assessment of property qualifying under subsection (a) has the burden of proof to establish that the assessment is correct and that the assessed value is the lowest value of those determined using the three (3) appraisal approaches performed by the county assessor or township assessor regardless of the percentage change in the assessed value.
(h) Upon request of the taxpayer, the county assessor or township assessor making the assessment shall provide an explanation to the taxpayer concerning how the assessed value of the property was calculated.
(i) The department shall prescribe a specific form for property qualifying under subsection (a).
As added by P.L.1-2004, SEC.8 and P.L.23-2004, SEC.9. Amended by P.L.199-2005, SEC.3; P.L.146-2008, SEC.85; P.L.146-2012, SEC.2; P.L.111-2014, SEC.15; P.L.236-2023, SEC.18.