Indianapolis, IN – Indiana residents aged 65 and older have access to extra deductions that can significantly reduce taxable income. These benefits are designed to ease financial pressure for seniors living on fixed or limited incomes.
This guide explains Indiana’s senior tax deductions for 2025, who qualifies, and how these state benefits work alongside federal rules.
Understanding Indiana’s Senior Tax Benefits
Indiana offers standard deductions for all taxpayers, but seniors may qualify for additional perks:
- Standard deductions adjust taxable income for general relief.
- Seniors 65+ may claim the Over-65 Deduction or Over-65 Income Exemption, depending on income and filing situation.
- These state benefits are separate from federal deductions available to seniors.
Over-65 Deduction: Property Tax Relief for Seniors
WANE reported that the seniors, 65 and older by December 31 can claim:
- Up to $14,000 for married couples filing jointly
- $7,000 for individual filers
Eligibility: Must own or lease their Indiana primary residence.
Benefit: Reduces property tax liabilities, helping seniors keep more of their income while staying in their homes.
Over-65 Income Exemption: Lowering State Income Taxes
In addition to the property-based deduction, seniors may qualify for:
- $1,000 exemption per senior ($2,000 for married couples 65+)
- Income limits: Federal AGI above ~$40,000 for joint filers may make you ineligible
Federal Extra Standard Deduction for Seniors
Indiana seniors also benefit from federal deductions:
- Single or Head of Household: Extra $1,950
- Married Filing Jointly: $1,550 per spouse; $3,100 if both are 65+
Combined with Indiana benefits, these deductions can result in substantial tax savings.
Eligibility Checklist for Indiana Seniors
To claim these deductions, seniors must:
- Be 65 or older by December 31 of the tax year
- File an Indiana state tax return, even if no taxes are due
- Own or lease their primary residence for property-based deductions
- Meet income limits for the Over-65 Income Exemption
Why Indiana Seniors Should Care
Many retirees rely on Social Security, pensions, or modest retirement accounts. Claiming all available deductions can save hundreds or thousands of dollars annually. Careful review of eligibility ensures no money is left on the table.
Bottom Line: Keep More of Your Hard-Earned Money
Indiana seniors can reduce their tax burden through state-level deductions, income exemptions, and the federal senior standard deduction. Understanding and claiming these benefits helps older Hoosiers preserve more of their retirement income.
Are you an Indiana senior taking advantage of the Over-65 Deduction or Income Exemption? Share your experiences, questions, or tips in the comments below—your insights could help fellow retirees save more on their taxes!
