2,700 Property Owners Must Prove Qualification For Homestead Exemption

By Emma Koch

2,700 Property Owners Must Prove Qualification For Homestead Exemption

March 26, 2013 Updated Dec 4, 2013 at 9:35 PM EDT

ALLEN COUNTY, Ind. (www.incnow.tv) -- Property owners who have been claiming the homestead exemption over the last three years will have to prove that they deserve the exemption or face a massive tax increase.

The homestead exemption can only be applied to the homeowner's principal residence and it is worth 60% of the assessed value, or $45,000, whichever is less. State officials have suspected that property owners have been claiming their exemption on multiple residences.

In 2010-2012, the Allen County Auditor's Office sent out forms to homeowners asking them to verify their exemptions. 40,000 of those property owners had not done so as of a year ago. So Auditor Tera Klutz hired Tax Management Associates to investigate the property tax records from every homeowner in the county who had filed an exemption.

The investigation examined owners who had a homestead deduction filed in Indiana or anywhere else in the U.S., had a home in a trust or similar red flags. Monday the Auditor's Office began mailing questionnaires to the 2,700 that remained on the list.

How homeowners answer those questions will determine if they are granted the exemption or denied. IF they are denied then they will have to pay taxes on the property for the years they wrongly filed the exemption.

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