DEPARTMENT OF STATE REVENUE
Information Bulletin #59
Income Tax
August 2015
(Replaces Information Bulletin #59 dated August 2014)
Effective Dates: January 1, 2015; January 1, 2016
SUBJECT: Summary of Tax Credits Available to Taxpayers Who File Income Tax Returns
DISCLAIMER: Information bulletins are intended to provide nontechnical assistance to the general public. Every attempt is made to provide information that is consistent with the appropriate statutes, rules, and court decisions. Any information that is inconsistent with the law, regulations, or court decisions is not binding on either the department or the taxpayer. Therefore, information provided in this bulletin should serve only as a foundation for further investigation and study of the current law and procedures related to its subject matter.
Adds description of credits that were enacted in 2015 (Teacher Classroom Supplies Credit effective Jan. 1, 2015, and the credit for property taxes paid by for-profit hospitals effective Jan. 1, 2016) and eliminates credits that have expired or been repealed (Historic Building Rehabilitation Tax Credit repealed effective Jan. 1, 2016, and the County Credit for the Elderly repealed effective Jan. 1, 2016).
Numerous Indiana tax credits are available for individual, fiduciary, partnership, and corporate taxpayers. This bulletin classifies all the various credits into a combined summary. It includes the credits that may be claimed when the annual income tax return or other applicable tax form is filed. In the case of partnerships, limited liability partnerships, S corporations, and limited liability companies, some credits are allocated to pass through to the partners, shareholders, or members of the entity.
You can obtain detailed information on selected credits by searching on the department's website at http://www.in.gov/dor/3650.htm.
Credits are divided into two types:
• Nonrefundable credits that may be applied against certain tax liabilities
• Refundable credits, which are available for a refund after all tax liabilities are offset
Type 1: Nonrefundable Credits and Carryovers
Some of the nonrefundable credits may be used only to reduce specific current-year tax liabilities. The unused portion of the credit cannot be refunded or applied against other outstanding tax liabilities. However, other nonrefundable credits have provisions stipulating that if the credit exceeds the total of the current amount of tax due, the unused portion may be carried forward to the taxpayer's future tax liabilities for the same tax type.
Type 2: Refundable Credits
Refundable credits have a limited period of time in which they may be claimed to be eligible for refund. Also, at the taxpayer's election, all or a portion of a current year's eligible refund can carry over toward the next year's income tax liability. However, the department may reduce or apply an eligible refund toward the taxpayer's other unpaid tax liabilities according to IC 6-8.1-9-2 and for a debtor's offset of refunds under IC 6-8.1-9.5.
II. CREDITS AVAILABLE TO TAXPAYERS
The chart titled Tax Liability Credits on page 4 lists all the available nonrefundable and refundable credits. Each credit is classified into one of the following five categories.
1-A. Nonrefundable credits for certain charitable contributions made within Indiana
1-B. Nonrefundable credits for qualified investments made within Indiana
1-C. Nonrefundable credits for income and business activities of Indiana taxpayers
2-D. Refundable credits for personal and business activities of Indiana taxpayers
2-E. Refundable credits for estimated and withholding taxes paid to Indiana
Each credit has been assigned a three-digit code or label identifier to be used when claiming credits on the Indiana tax return. The chart includes these codes and a listing of required enclosures for claiming the credit on a tax return.
For filing requirements, eligibility, amount of credit, effective dates, carryback/carryforward application, and other detailed information, see the specific income tax information bulletin issued by the Department of Revenue or contact the agency administering the tax credit for instructions. Claims for credits should be supported by filing all applicable schedules and forms or by a separate calculation and certification from the appropriate agency of the amounts eligible for credit.
Restrictions and Limitations
The credits are to be applied against the claimant's tax due in the following order:
• Credits classified as nonrefundable credits are to be applied first.
• Those credits with carryover allowances are to be applied second.
• Refundable credits are to be applied last.
The type of tax to which the credit may be applied is also listed. If the credit can be applied against more than one tax type, the additional tax types are listed in the order to be applied.
A taxpayer, pass-through entity, shareholder, partner, or member of a pass-through entity cannot be granted more than one tax credit for the same project. This restriction applies to the following credits:
• Community Revitalization Enhancement District Tax Credit (808)
• Enterprise Zone Investment Credit (813)
• Hoosier Alternative Fuel Vehicle Manufacturer Tax Credit (845)
• Hoosier Business Investment Tax Credit (820)
• Industrial Recovery Tax Credit (824)
• Venture Capital Investment Tax Credit (835)
Amount of Credit Available
The amount of credit available to be granted may be limited by the statute creating the credit. The following describes those limitations:
• Unlimited – There is no limit other than the provisions governing the calculation of an allowable credit up to the amount of tax available to be offset.
• Limited – The sum of all approved credits is limited to either the annual amount of the grant money available or the total of all credits that are allowed by the tax credit program.
| | |
Identifier | Tax Type | Indiana Code |
AGIT | Adjusted Gross Income Tax * | IC 6-3-1 through IC 6-3-7 |
CAGIT | County Adjusted Gross Income Tax | IC 6-3.5-1.1 |
CEDIT | County Economic Development Income Tax | IC 6-3.5-7 |
COIT | County Option Income Tax | IC 6-3.5-6 |
FIT | Financial Institutions Tax* | IC 6-5.5 |
INSUR | Insurance Premium Tax * | IC 27-1-18-2 |
SALES | State Gross Retail and Use Tax - Sales tax due on nonexempt purchases | IC 6-2.5 |
URT | Utility Receipts Tax * | IC 6-2.3 |
USUT | Utility Services Use Tax | IC 6-2.3-5.5 |
Note: Insurance premium tax, inheritance tax, and property tax are not listed taxes under IC 6-8.1-1-1. |
* May include other Indiana state taxes and fees collected on the annual return. |
Tax Liability Credits Chart
Type 1-A Credit for certain charitable contributions within Indiana
| | | |
| | | |
Identifier | Tax Liability Credits | Tax Offset | Required Enclosure |
|
Unlimited (No dollar limit to the total amount of credits granted.) |
| | | |
New | Adoption Credit | AGIT | Effective Jan. 1, 2015 |
859 | | | |
| Charitable Contributions to Higher | AGIT | Schedule CC-40 |
CC | Education Institutions (College | | |
807 | Credit) | | |
834 | Twenty-First Century Scholars Program Support Fund | AGIT | Schedule TCSP-40 |
| |
Limited (Approved credits are limited to the amount of grant money available.) |
823 | Individual Development Account Credit | AGIT, FIT | Approved Form IDA-20; IN K-1 pass-through |
828 | Neighborhood Assistance Credit | AGIT, FIT | Approved Form NC-20; IN K-1 pass-through |
849 | School Scholarship Tax Credit | AGIT, INSUR, FIT | Schedule IN-OCC |
Type 1-B Credit for qualified investments (expenditures) made within Indiana
| | | |
| | | |
Identifier | Tax Liability Credits | Tax Offset | Required Enclosure |
|
Unlimited (No dollar limit to the total amount of credits granted.) |
| | | |
806 | Coal Gasification Technology Investment Credit | AGIT, FIT, INSUR, URT | Certification by IURC; IN K-1 pass-through |
808* | Community Revitalization Enhancement District Credit (CRED credit) | AGIT, CAGIT, COIT, CEDIT, INSUR, FIT | Certification by IEDC; IN K-1 pass-through |
812 | Enterprise Zone Employment Expense Credit | AGIT, INSUR, FIT | Schedule EZ 1, 2, 3; IN K-1 pass-through |
813* | Enterprise Zone Investment Cost Credit (for individuals and LLCs) | AGIT | Certification by IEDC; IN K-1 pass-through |
818 | Headquarters Relocation Credit (availability beginning in 2006) | AGIT, FIT, INSUR | Proof of investment; IN K-1 pass-through |
820* | Hoosier Business Investment Credit | AGIT, INSUR, FIT | Certification by IEDC and proof of investment; IN K-1 pass-through; Schedule IN-OCC |
822 | Indiana Research Expense Credit | AGIT | Schedule IT-20REC; IN K-1 pass-through |
824* | Industrial Recovery Credit | AGIT, INSUR, FIT | Certification by IEDC and credit assignment |
|
Limited (Approved credits are limited to the amount of grant money available.) |
| | | |
835* | Venture Capital Investment Credit | SALES, AGIT, INSUR, FIT | Certification by IEDC, credit assignment, and proof of investment; IN K-1 pass-through |
845 | Alternative Fuel Vehicle Manufacturer Tax Credit | AGIT, INSUR, FIT | Certification by IEDC |
New | Natural Gas-powered Vehicles Tax Credit | AGIT, INSUR, FIT | Schedule NGV-C; Schedule IN-OCC |
| | | |
*Additional restriction: Only one credit is allowed for the same project. |
Type 1-C Credits for income and business activities of Indiana taxpayers
| | | |
| | | |
Identifier | Tax Liability Credits | Tax Offset | Required Enclosure |
|
Unlimited (No dollar limit to the total amount of credits granted.) |
| | | |
OOL | Credit for Local Taxes Paid Outside | CAGIT, | Complete worksheet in |
810 | Indiana (for individuals only) | COIT | IT-40/IT-40PNR Booklet |
OOS | Credit for Taxes Paid to Other States | AGIT | Signed copy of return |
811 | (for individuals only) | | from other state |
814 | Enterprise Zone Loan Interest Credit | AGIT, INSUR, FIT | Schedule LIC; IN K-1 pass-through |
837 | Indiana College Choice 529 Savings Plan Credit (for individuals filing single or married couples filing a joint return) | AGIT | Proof of contribution to Indiana College Choice 529 Plan account |
821 | Indiana Comprehensive Health Insurance Association Credit (for insurance companies only) | INSUR, AGIT | Complete IT-20 Schedule H when claiming credit on Form IT-20 |
817 | Indiana Insurance Guaranty Association Credit (for insurance companies only) | INSUR, AGIT | Complete Schedule H when claiming credit on Form IT-20 |
816 | Nonresident Taxpayer Credit (for financial institutions only) | FIT | Schedule FIT-NRTC |
ST | Teacher Purchase of Classroom Supplies | AGIT | Effective Jan. 1, 2015 |
| | | |
| Use Tax Credit | SALES | Complete Sales/Use Tax Worksheet in tax instruction booklets or file Form ST-115 |
|
Limited (Approved credits are limited to the amount of grant money available.) |
|
831 | Residential Historic Rehabilitation Credit (for individuals only) | AGIT | Certification by Office of Community and Rural Affairs |
Type 2-D Credits for personal and business activities of Indiana taxpayers
| | | |
| | | |
Identifier | Tax Liability Credits | Tax Offset | Required Enclosure |
|
Unlimited (No dollar limit to the total amount of credits granted.) |
|
EIC | Earned Income Credit (for individuals only) | AGIT | Schedule IN-EIC |
LAKE | Income Tax Credit for Property Taxes Paid on Homesteads in Lake County (for individuals only) | AGIT | Complete worksheet in IT-40/IT-40PNR Booklet |
| | | |
| Income Tax Credit for Property Taxes Paid by For-Profit Hospital | AGIT | Effective Jan. 1, 2016 |
| | | |
UTCE | Unified Tax Credit for the Elderly (for individuals only) [Restriction - Tax credit allowed only if claim is timely filed within six months from the end of the tax year or by the extended due date for filing the annual IT-40 return.] | AGIT | Follow instructions on IT-40/IT-40PNR return unless qualified to file claim on Form SC-40 |
|
Limited (Approved credits are limited to the amount of grant money available.) |
|
EDGE | Economic Development for a Growing Economy - Job Retention Credit | AGIT, INSUR , FIT | Schedule IN-EDGE-R |
Type 2-E Credit for estimated and withholding taxes paid to Indiana
| | | |
| | | |
Identifier | Tax Liability Credits | Tax Offset | Required Enclosure |
|
Unlimited (Credit is allowed for the total amount of tax withheld or paid.) |
|
EST | Credit for Estimated Tax Paid (Refundable if claimed within three years of the due date, including extensions.) | AGIT, FIT, URT | Follow instructions on annual income tax return to claim amount of estimated taxes paid for the taxable year |
WTH | Credit for State and County Income Taxes Withheld (Refundable if claimed within three years of the due date, including extensions.) | AGIT | Form(s) W-2, W2-G, 1099, and 1099R showing Indiana tax withheld (for more information, see Commissioner's Directive #13) |
To claim credits, you must follow application or claim procedures specified by each tax credit program. Complete the appropriate forms and provide all required supporting documentation. See www.in.gov/dor/3650.htm for additional information issued by the Department of Revenue, or contact the agency administering the credit to verify eligibility requirements and filing instructions.
The following is a list of tax credits and contact information for the administering agency of each credit. For credits directly administered by other agencies, contact the state agency listed that administers the tax credit in cooperation with the Department of Revenue.
| |
Administering Agency | Tax Credit |
Indiana Department of Revenue | • Charitable Contributions to Higher Education |
Taxpayer Services Division | Institutions |
100 N. Senate Ave. | • Credit for Estimated Tax Paid |
Indianapolis IN 46204 | • Credit for Local Taxes Paid |
(317) 232-2240 | • Outside Indiana |
www.in.gov/dor | • Credit for Taxes Paid to Other States |
| • Credit for Taxes Withheld |
| • Earned Income Credit |
| • Income Tax Credit for Property Taxes Paid |
| by a For Profit Hospital |
| • Indiana Research Expense Credit |
| • Income Tax Credit for Property Taxes Paid |
| on Homesteads in Lake County |
| • Natural Gas-Powered Vehicle Credit |
| • Nonresident Taxpayer Credit |
| • Teacher Classroom Supplies Tax Credit |
| • Unified Tax Credit for the Elderly |
| • Use Tax Credit |
Indiana Economic Development | • Alternative Fuel Vehicle Manufacturer Credit |
Corporation | • Coal Gasification Technology Investment |
One North Capitol, Suite 700 | • Community Revitalization Enhancement |
Indianapolis, IN 46204 | District Credit (CRED) |
(317) 232-8800 | • Economic Development for a Growing |
www.in.gov/iedc | Economy (Job Retention Credit) |
| • Enterprise Zone Employment Expense |
| Credit |
| • Enterprise Zone Investment Cost Credit |
| • Enterprise Zone Loan Interest Credit (LIC) |
| • Headquarters Relocation Credit |
| • Hoosier Business Investment Credit |
| • Indiana Research Expense Credit (with |
| regard to aerospace industry) |
| • Industrial Recovery Credit |
| • Venture Capital Investment Credit |
Indiana Educational Savings Authority | • Indiana College Choice 529 Savings Plan |
One North Capitol, Suite 444 | Credit |
Indianapolis, IN 46204 | |
(317) 232-5259 | |
www.in.gov/iesa | |
www.collegechoiceplan.com | |
Indiana Comprehensive Health | • Indiana Comprehensive Health Insurance |
Insurance Association | Association Credit |
4550 Victory Lane | |
P.O. Box 33730 | |
Indianapolis, IN 46203 | |
(317) 614-2018 | |
Indiana Life and Health Insurance | • Indiana Insurance Guaranty Association |
Guaranty Association | Credit |
251 E. Ohio St., Suite 1070 | |
Indianapolis, IN 46204 | |
http:///www.inlifega.org/ | |
Indiana Housing and Community | • Neighborhood Assistance Credit |
Development Authority | |
Neighborhood Assistance Program | |
30 S. Meridian St., Suite 1000 | |
Indianapolis, IN 46204 | |
(317) 232-7777 | |
(800) 872-0371 (outside Indianapolis) | |
Office of Community and Rural Affairs | • Residential Historic Rehabilitation Credit |
One North Capitol, Suite 600 | |
Indianapolis, IN 46204 | |
(317) 233-3762 | |
www.in.gov/ocra | |
Division of Student Financial Aid | • Twenty-First Century Scholars Program |
Commission for Higher Education | Support Fund |
101 W. Ohio St. | |
Indianapolis, IN 46204 | |
(888) 528-4719 | |
| |
__________________________
Posted: 09/30/2015 by Legislative Services Agency
DIN: 20150930-IR-045150324NRA
Composed: May 05,2024 4:57:08PM EDT
A PDF version of this document.
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