2023 Indiana Code › Title 6. Taxation › Article 1.1. Property Taxes › Chapter 20.6. Credit for Excessive Property Taxes › 6-1.1-20.6-9.8. Allocation of Taxes Exempted From Credit

Sec. 9.8. (a) This section applies to property taxes first due and payable after December 31, 2009.
(b) The following definitions apply throughout this section:
(1) "Debt service obligations of a political subdivision" refers to:
(A) the principal and interest payable during a calendar year on bonds; and
(B) lease rental payments payable during a calendar year on leases;
of a political subdivision payable from ad valorem property taxes.
(2) "Protected taxes" refers to the following:
(A) Property taxes that are exempted from the application of a credit granted under section 7 or 7.5 of this chapter by section 7(b), 7(c), 7.5(b), or 7.5(c) of this chapter or another law.
(B) Property taxes imposed by a political subdivision to pay for debt service obligations of a political subdivision that are not exempted from the application of a credit granted under section 7 or 7.5 of this chapter by section 7(b), 7(c), 7.5(b), or 7.5(c) of this chapter or any other law. Property taxes described in this subsection are subject to the credit granted under section 7 or 7.5 of this chapter by section 7(b), 7(c), 7.5(b), or 7.5(c) of this chapter regardless of their designation as protected taxes.
(3) "Unprotected taxes" refers to property taxes that are not protected taxes.
(c) Except as provided in section 9.9 of this chapter, the total amount of revenue to be distributed to the fund for which the protected taxes were imposed shall be determined as if no credit were granted under section 7 or 7.5 of this chapter. The total amount of the loss in revenue resulting from the granting of credits under section 7 or 7.5 of this chapter must reduce only the amount of unprotected taxes distributed to a fund using the following criteria:
(1) The reduction may be allocated in the amounts determined by the political subdivision using a combination of unprotected taxes of the political subdivision in those taxing districts in which the credit caused a reduction in protected taxes.
(2) The tax revenue and each fund of any other political subdivisions must not be affected by the reduction.
(d) When:
(1) the revenue that otherwise would be distributed to a fund receiving only unprotected taxes is reduced entirely under subsection (c) and the remaining revenue is insufficient for a fund receiving protected taxes to receive the revenue specified by subsection (c); or
(2) there is not a fund receiving only unprotected taxes from which to distribute revenue;
the revenue distributed to the fund receiving protected taxes must also be reduced. If the revenue distributed to a fund receiving protected taxes is reduced, the political subdivision may transfer money from one (1) or more of the other funds of the political subdivision to offset the loss in revenue to the fund receiving protected taxes. The transfer is limited to the amount necessary for the fund receiving protected taxes to receive the revenue specified under subsection (c). The amount transferred shall be specifically identified as a debt service obligation transfer for each affected fund.
As added by P.L.172-2011, SEC.42. Amended by P.L.137-2012, SEC.35; P.L.257-2013, SEC.29; P.L.244-2017, SEC.12.