Exemption of building, land, and personal property used for
various purposes; termination of eligibility for exemption
Sec. 16. (a) All or part of a building is exempt from property
taxation if it is owned, occupied, and used by a person for
educational, literary, scientific, religious, or charitable purposes.
(b) A building is exempt from property taxation if it is owned,
occupied, and used by a town, city, township, or county for
educational, literary, scientific, fraternal, or charitable purposes.
(c) A tract of land, including the campus and athletic grounds of
an educational institution, is exempt from property taxation if:
(1) a building that is exempt under subsection (a) or (b) is
situated on it;
(2) a parking lot or structure that serves a building referred to in
subdivision (1) is situated on it; or
(3) the tract:
(A) is owned by a nonprofit entity established for the
purpose of retaining and preserving land and water for their
natural characteristics;
(B) does not exceed five hundred (500) acres; and
(C) is not used by the nonprofit entity to make a profit.
(d) A tract of land is exempt from property taxation if:
(1) it is purchased for the purpose of erecting a building that is
to be owned, occupied, and used in such a manner that the
building will be exempt under subsection (a) or (b); and
(2) not more than three (3) years after the property is purchased,
and for each year after the three (3) year period, the owner
demonstrates substantial progress and active pursuit towards the
erection of the intended building and use of the tract for the
exempt purpose. To establish substantial progress and active
pursuit under this subdivision, the owner must prove the
existence of factors such as the following:
(A) Organization of and activity by a building committee or
other oversight group.
(B) Completion and filing of building plans with the
appropriate local government authority.
(C) Cash reserves dedicated to the project of a sufficient
amount to lead a reasonable individual to believe the actual
construction can and will begin within three (3) years.
(D) The breaking of ground and the beginning of actual
construction.
(E) Any other factor that would lead a reasonable individual
to believe that construction of the building is an active plan
and that the building is capable of being completed within
six (6) years considering the circumstances of the owner.
(e) Personal property is exempt from property taxation if it is
owned and used in such a manner that it would be exempt under
subsection (a) or (b) if it were a building.
(f) A hospital's property that is exempt from property taxation
under subsection (a), (b), or (e) shall remain exempt from property
taxation even if the property is used in part to furnish goods or
services to another hospital whose property qualifies for exemption
under this section.
(g) Property owned by a shared hospital services organization that
is exempt from federal income taxation under Section 501(c)(3) or
501(e) of the Internal Revenue Code is exempt from property
taxation if it is owned, occupied, and used exclusively to furnish
goods or services to a hospital whose property is exempt from
property taxation under subsection (a), (b), or (e).
(h) This section does not exempt from property tax an office or a
practice of a physician or group of physicians that is owned by a
hospital licensed under IC 16-21-1 or other property that is not
substantially related to or supportive of the inpatient facility of the
hospital unless the office, practice, or other property:
(1) provides or supports the provision of charity care (as
defined in IC 16-18-2-52.5), including providing funds or other
financial support for health care services for individuals who
are indigent (as defined in IC 16-18-2-52.5(b) and
IC 16-18-2-52.5(c)); or
(2) provides or supports the provision of community benefits
(as defined in IC 16-21-9-1), including research, education, or
government sponsored indigent health care (as defined in
IC 16-21-9-2).
However, participation in the Medicaid or Medicare program alone
does not entitle an office, practice, or other property described in this
subsection to an exemption under this section.
(i) A tract of land or a tract of land plus all or part of a structure
on the land is exempt from property taxation if:
(1) the tract is acquired for the purpose of erecting, renovating,
or improving a single family residential structure that is to be
given away or sold:
(A) in a charitable manner;
(B) by a nonprofit organization; and
(C) to low income individuals who will:
(i) use the land as a family residence; and
(ii) not have an exemption for the land under this section;
(2) the tract does not exceed three (3) acres;
(3) the tract of land or the tract of land plus all or part of a
structure on the land is not used for profit while exempt under
this section; and
(4) not more than three (3) years after the property is acquired
for the purpose described in subdivision (1), and for each year
after the three (3) year period, the owner demonstrates
substantial progress and active pursuit towards the erection,
renovation, or improvement of the intended structure. To
establish substantial progress and active pursuit under this
subdivision, the owner must prove the existence of factors such
as the following:
(A) Organization of and activity by a building committee or
other oversight group.
(B) Completion and filing of building plans with the
appropriate local government authority.
(C) Cash reserves dedicated to the project of a sufficient
amount to lead a reasonable individual to believe the actual
construction can and will begin within six (6) years of the
initial exemption received under this subsection.
(D) The breaking of ground and the beginning of actual
construction.
(E) Any other factor that would lead a reasonable individual
to believe that construction of the structure is an active plan
and that the structure is capable of being:
(i) completed; and
(ii) transferred to a low income individual who does not
receive an exemption under this section;
within six (6) years considering the circumstances of the
owner.
(j) An exemption under subsection (i) terminates when the
property is conveyed by the nonprofit organization to another owner.
When the property is conveyed to another owner, the nonprofit
organization receiving the exemption must file a certified statement
with the auditor of the county, notifying the auditor of the change not
later than sixty (60) days after the date of the conveyance. The
county auditor shall immediately forward a copy of the certified
statement to the county assessor. A nonprofit organization that fails
to file the statement required by this subsection is liable for the
amount of property taxes due on the property conveyed if it were not
for the exemption allowed under this chapter.
(k) If property is granted an exemption in any year under
subsection (i) and the owner:
(1) ceases to be eligible for the exemption under subsection
(i)(4);
(2) fails to transfer the tangible property within six (6) years
after the assessment date for which the exemption is initially
granted; or
(3) transfers the tangible property to a person who:
(A) is not a low income individual; or
(B) does not use the transferred property as a residence for
at least one (1) year after the property is transferred;
the person receiving the exemption shall notify the county recorder
and the county auditor of the county in which the property is located
not later than sixty (60) days after the event described in subdivision
(1), (2), or (3) occurs. The county auditor shall immediately inform
the county assessor of a notification received under this subsection.
(l) If subsection (k)(1), (k)(2), or (k)(3) applies, the owner shall
pay, not later than the date that the next installment of property taxes
is due, an amount equal to the sum of the following:
(1) The total property taxes that, if it were not for the exemption
under subsection (i), would have been levied on the property in
each year in which an exemption was allowed.
(2) Interest on the property taxes at the rate of ten percent
(10%) per year.
(m) The liability imposed by subsection (l) is a lien upon the
property receiving the exemption under subsection (i). An amount
collected under subsection (l) shall be collected as an excess levy. If
the amount is not paid, it shall be collected in the same manner that
delinquent taxes on real property are collected.
(n) Property referred to in this section shall be assessed to the
extent required under IC 6-1.1-11-9.
(Formerly: Acts 1975, P.L.47, SEC.1.) As amended by Acts 1979,
P.L.51, SEC.1; P.L.74-1987, SEC.4; P.L.57-1993, SEC.7;
P.L.25-1995, SEC.13; P.L.6-1997, SEC.35; P.L.2-1998, SEC.17;
P.L.126-2000, SEC.4; P.L.198-2001, SEC.28; P.L.264-2003, SEC.1.
Last modified: May 28, 2006