(INDIANAPOLIS) – Indiana will see three tax changes happening in 2023.

The changes are coming about because of bills that were passed in the 2022 session of the Indiana General Assembly.

According to information released by The Tax Foundation, a National nonprofit studying tax policy in the United States, the first change in Indiana is a reduction in the State’s income tax. This is because lawmakers voted in favor of lowering the Indiana income tax rate as part of a large tax bill in the Spring of 2022.

This could possibly reduce the Indiana flat income tax rate from 3.23% to 2.9% by the year 2029, if conditions are met. In 2023, the first step will take place with a reduction of the tax rate to 3.15%.

Then next change would remove the $3,000 mortgage deduction from property taxes. However, State lawmakers did agree to increase the standard homestead deduction from $45,000 to $48,000. That means borrowers will not see any change in their tax bills.

Individuals who own their primary residence will see a savings with this change, and it will vary depending on their home value and local tax rate.

Lawmaker also voted to increase the maximum home value for individuals 65 and older from $200,000 to $240,000. More seniors will be able to take advantage of the deduction, with is going to be either half of the remaining assessed value, or $14,000, whichever is the lesser amount.

The third change will be for those who like to gamble, as Indiana has agreed to phase out its add-back of the Federal income tax deduction allowed for wagering taxes, with the add-back decreasing from 50% to 37.5% of the Federal amount.