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Tax abatement is an economic development tool the City of Indianapolis utilizes to assist business and property owners when making a capital investment. The goals of this economic development incentive are to expand the tax base, to create and retain good paying jobs, and to diversify the local economy.

Tax abatement does not provide a 100% abatement of property taxes each year. The increase in the assessed value due to the project will gradually phase in over a one to ten year period. The City of Indianapolis does view the granting of tax abatement as a public sector investment in the company and consequently evaluates each applicant based on policy criteria when making a recommendation to the Metropolitan Development Commission for tax abatement.

The City of Indianapolis administers both real and personal property tax abatements:

  • Real Property
    Projects involving new construction, expansion or renovation may be eligible to receive tax abatement on the real property improvements. Because tax abatement is expressed in terms of assessed value, costs such as land or consulting/development fees are not abatable.

  • Personal Property
    Projects involving the acquisition and installation of new manufacturing equipment, research and development equipment, logistical distribution equipment, and information technology equipment may qualify for tax abatement on increases in the assessed value of the personal property improvements.

Real & Personal Tax Abatement Policy

Tax Abatement Forms