County auditors would cap homestead taxes unless physical changes raise assessments

County auditors would calculate an individual's homestead property tax liability under this chapter. The calculation covers an individual's homestead and a qualified ownership interest. For an ownership interest acquired before 2026, the amount is the liability for 2026 taxes. For an interest acquired after 2025, the amount is the lower of the liability for the acquisition year's assessment or the lowest liability in a later calendar year. The chapter applies to property taxes first due in 2027 and later years. A separate applicability section expires January 1, 2029.

A physical change that raises a homestead's assessment would add the resulting tax liability to the calculated amount. This applies when a physical change to a homestead results in a higher assessment after the owner acquires a qualified interest. The added amount covers only liability directly caused by the physical change. The amount is based on the first year the new assessment would otherwise raise the tax bill. The added liability applies to later tax years, using the amount for the first year the higher assessment would otherwise raise the bill.