Indiana farmers and agribusiness owners are reporting steep increases in property tax assessments on livestock barns, grain facilities and storage structures this year, with some agricultural buildings seeing assessed values climb by as much as 300 percent — a surge that farm groups warn could deepen financial strain across a struggling rural economy.
“The farm economy isn’t great right now, and rising property taxes on ag buildings is certainly the last thing any of our members want to see,” said Ryan Hoff, senior director of government affairs for Indiana Farm Bureau.
The increases stem largely from updated construction cost tables issued by the Indiana Department of Local Government Finance, which had not been fully revised since 2022 and were still based on pre-inflation construction data from 2021. The revised formulas now reflect the sharp rise in labor and material costs that followed the pandemic-era construction boom.
Hoff said the reassessments are tied directly to the state’s recalculation of construction input costs for agricultural structures.
“The state puts out cost tables that reflect the cost of building materials that go into building ag structures—that could be steel, concrete, etc. On a sort of regular basis, the state updates those cost tables to reflect actual market costs for those inputs. Now, I say the state has been doing sort of regular updates to the cost schedules because the update this year is the first that fully reflects the post-COVID inflation in construction inputs, and so that is one of the reasons why assessments have increased dramatically this spring,” says Hoff.
Unlike residential and commercial real estate, agricultural buildings in Indiana are difficult to adjust for market depreciation because there are relatively few comparable sales available to establish market value. Farm advocates say that can leave aging livestock barns, grain bins and storage facilities assessed at figures that far exceed their actual condition or economic usefulness.
Ag leaders with Indiana Farm Bureau and the Agribusiness Council of Indiana say they have begun discussions with state lawmakers about possible relief measures, including lowering the property tax cap on agricultural buildings from 3 percent to 2 percent.
Hoff said the proposal would build on broader property tax reforms approved by the legislature in 2025.
“But also, after the 2025 property tax reforms, the 2% property class—which includes ag land for example—will be receiving a one-third deduction of assessed value,” says Hoff. “That phases in over the next five years, but that would be essentially a one-third write-down of your assessed value to not only protect or reduce your taxable value on your buildings today, but also help protect against increases in the future. Because when there are increases, a third of the value would be written down if we can get the legislature to move these farm buildings from the 3% property tax class over to the 2% tax class.”
Farmers who believe their assessments are inaccurate can challenge them through Indiana’s appeals process, which begins with filing a Form 130 appeal with their local assessor. Under Indiana law, assessors must justify increases greater than 5 percent. Appeals can move from county review boards to the Indiana Board of Tax Review and ultimately to the Indiana Tax Court.
“Keep in mind that the formal appeals deadline is June 15th. So to initiate the appeals process, you need to fill out the appeals paperwork before June 15th and have that to your county assessor,” Hoff said.
Indiana’s current appeals framework was established under Senate Enrolled Act 386, passed by the Indiana General Assembly in 2017, which consolidated several property tax appeal procedures into a single system.
For many Indiana farmers already grappling with lower commodity prices, high input costs and tighter operating margins, the assessment increases have become another source of uncertainty heading deeper into the growing season. Farm organizations say the debate now unfolding at the Statehouse could determine whether agricultural property taxes become a temporary shock tied to inflation — or a longer-term burden for family farms and rural businesses across the state.
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