Two Indiana property-tax provisions use the term circuit breaker. One limits liability by a property's assessed value and classification; the other limits growth in an eligible older owner's bill.
The two circuit breaker provisions
The circuit breaker is a cap on property tax liability, stated as a percentage of the gross assessed value of the property and set by what the property is used for. A homestead is capped at 1%.
Other residential property, long term care property and agricultural land are capped at 2%. Nonresidential real property and personal property are capped at 3%. Because it is a percentage of the property, it recalculates on the next house automatically and there is nothing to carry over.
The separate over 65 circuit breaker credit, which limits how fast a bill can grow, does not survive a move.
How the cap actually works
The statute entitles a person to a credit against property tax liability equal to the amount by which the liability for a class of property exceeds that class's percentage of the gross assessed value used to determine that year's taxes. In other words, you are not billed above the line; the amount above the line becomes a credit. Taxes approved by voters in a referendum or local public question sit outside the calculation, which is why a bill can exceed the headline percentage in a district that has passed one.
The cap is calculated against the property's gross assessed value under its qualifying classification. The 1% figure for a homestead therefore needs to be considered with the new property's assessment and the required homestead filing.
The homestead classification
The 1% rate depends on the property being a homestead, and a property is a homestead because the owner filed for the standard homestead deduction and qualified. The cap does not know you live there. The deduction filing is what tells the system. So the practical answer to "does the cap follow me" is yes in its arithmetic and no in its paperwork: the percentage applies automatically, the classification that earns you the 1% rather than the 2% does not.
The over 65 circuit breaker credit is a different animal
This is the one that actually breaks on a move. It is a separate credit that limits the year-over-year growth of the net tax on a qualified homestead to 2%, computed as this year's liability minus last year's post-credit liability multiplied by 1.02. To qualify, a person must have qualified for the standard homestead deduction in the preceding calendar year and again in the current year, on the same homestead.
There are age and income conditions as well.
The same homestead, two consecutive years. Sell and buy, and there is no preceding year on the new house. The credit is not transferred, reduced or prorated. It stops, and it starts again only once the new house has its own prior qualifying year. There is also a protection inside this credit that disregards assessed value increases after the later of December 31, 2019 or the first year of the credit, unless the increase comes from substantial renovation or new improvements, and that protection restarts from the new first year too.
What that is worth, in the only terms that are honest
I am not going to put a dollar figure on it, because it depends on the two bills and on how fast assessed values are moving in the district, and nobody has those numbers for a house that has not been bought yet. What can be said without guessing is the shape: the longer someone has held the credit, the more growth it has absorbed, and the more a move gives back. An owner who has had it for a decade is handing back a decade of accumulated restraint on the bill, not a year of it.
For an owner over 65, a change in the credit can affect the cost of the next home beyond the settlement statement. Include that question in the moving budget and confirm eligibility with the county auditor.
Whether you qualify, what your bill will be, what the assessed value on a house you are considering will be next year, and whether a specific credit applied correctly are the county auditor's and the county assessor's to answer, not mine. Income questions inside the over 65 test go to your CPA.
The over 65 benefits when you move goes through the application and the ownership year in detail, and the homestead deduction when you move covers the filing everything else depends on.
Sources, read October 13, 2026: IC 6-1.1-20.6-7.5 for the credit and the 1%, 2% and 3% caps against gross assessed value, the property classes and the referendum exclusion, and IC 6-1.1-20.6-8.5 for the over 65 circuit breaker credit, its same-homestead condition across two consecutive years, the 1.02 growth formula and the disregard of assessed value increases, both as reproduced on law.justia.com, which carries the 2025 code; Indiana Department of Local Government Finance memorandum of June 12, 2025 and memorandum of May 27, 2026 for the supplemental homestead credit and the current deduction schedules.
This note is general information, not legal or tax advice. Confirm your own situation with the county auditor before relying on it.