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Business Tax FAQs

General Business


  • How do I start a business in Indiana?
    1. Register your business through the Indiana Secretary of State.
    2. Register your business through INBiz.
      • Several tax types may be needed. For example, a business that sells a product will need to register for sales tax. A business that has employees will need to register for withholding tax.

    For more information, visit the Business Owner's Guide.

    Established businesses that need to add a tax type or a location can do so in INBiz. For example, if a business previously did not have employees, but now needs to hire help, the business will need to add the withholding tax account to its business profile.

  • How do I close my business in Indiana?

    It is required to send an Indiana Tax Closure Request (Form BC-100) to close the tax accounts for a business. If the BC-100 isn’t filed, the department may continue to send bills for estimated taxes.

  • How do I dissolve, liquidate or withdraw my corporation?

    All businesses registered with the Secretary of State Corporate Division must first file Articles of Dissolution with the Indiana Secretary of State. You may reach their office at (317) 232-6576.

    Once the Articles of Dissolution are approved, you receive a Certificate of Dissolution, the Indiana Department of Revenue requires the following:

    • Form IT-966 is a notice of dissolution that is required of all organizations
    • BC-100 allows the department to close your business trust tax accounts (i.e. sales tax, withholding tax, etc.)
    • Power of Attorney is required if someone other than a corporate officer requests a clearance concerning your dissolution
    • Final tax return for all Indiana tax type

    Mail the completed forms to:
    Indiana Department of Revenue - MS #110
    Enforcement Division/Corporate Dissolutions
    100 N. Senate Ave., Room N181 Indianapolis, IN 46204

    If you have additional questions, call us at (317) 232-3376.

  • Why do you require a Social Security number when registering a business?

    Social Security numbers are required by law. The Department does not provide any specific customer account information to any organization or person outside of the Department. The Social Security number is also used to verify the identity of authorized people on the business tax account.

  • Can I add different tax types at a later date?

    Yes. You can add different tax types as your business changes. You can add a tax type in INBiz.

  • Can I register using more than one NAICS code?

    You must enter at least one NAICS code, you may register up to four codes.

  • How far in advance can I register my business?

    The Department can process applications up to three months in advance.

  • What is the difference between LLC, LLP, LP, S Corporation, sole proprietorship and partnership?
    • Limited liability company (LLC*) – A business structure that blends some characteristics of a partnership and a corporation. Liabilities are limited to the owner’s agreed investment in the business. An LLC is an entity formed under state law by filing articles of organization. None of the members of an LLC are personally liable for the business’s debt.
    • Limited liability partnership (LLP*) – A hybrid form of a general partnership.
    • Limited partnership (LP*) – A form of partnership in which liabilities are limited to general partners, while limited partners’ liabilities are limited to their agreed investment in the business.
    • S Corporation – An eligible domestic corporation that can avoid double taxation (once to the corporation and again to the shareholders and/or employees). This business structure is exempt from federal income tax other than tax on certain capital gains and passive income. The income passes through to individual shareholders and is taxed on the shareholder's individual income tax return. An additional requirement is to obtain a Federal Employer Identification number. According to federal guidelines, to obtain a S Corporation status federal Form 2553 must be filed with the Internal Revenue Service.
    • Sole Proprietorship – A person who conducts business for profit. The sole owner assumes complete responsibility for all liabilities and debts of the business. Sole proprietorships are not required to register with the Indiana Secretary of State.
    • Partnership – Two or more individuals that own a for-profit business. All partners are responsible for the liabilities and debts of the partnership. The income passes through to individual partners and is taxed on the partner’s individual income tax return. General partnerships are not required to register with the Indiana Secretary of State.

    *Limited liability partnership, limited liability companies and limited partnerships are unincorporated entities, but are still considered formally organized entities.

    Visit the Indiana Secretary of State Web site or the Business Owner's Guide for more information.

  • If I registered for sales tax and hire employees later, what do I need to do?

    You will need to add withholding tax. You can add a tax type via INBIZ.

  • If I change my organization type am I required to re-register with the Indiana Department of Revenue?

    If an owner decides to change the organization type, he or she is required to complete a new application. If the owner is registering as a retail merchant there is a $25 registration fee.

    Change of a corporate officer does not require another registration. It is in the best interest of the taxpayer to re-register and receive his or her own taxpayer identification number. If the customer chooses not to do so he or she can update and/change responsible officers by completing the Responsible Officer Change Form (ROC-1).

  • Is a Federal Identification Number required if I am a partnership?

    Yes. The federal guidelines for businesses require partnerships and corporations to have a Federal Identification Number (FID). This number is also required when you withhold federal income tax from an employee regardless of the business organization type. To receive more information on how to obtain an FID number call (800) 829-4933.

  • Am I required to register with the Secretary of State?

    Organizations that are required to register with the Secretary of State include:

    • Corporations
    • S Corporations
    • Limited Liability Company (LLC)
    • Nonprofit Corporation
    • Limited Partnership (LP)
    • Limited Liability Partnership (LLP)

    To receive additional information on registration requirements you may visit the Secretary of State’s website or call (317) 232-6576.

  • What options do I have to file and pay my taxes?

    All businesses in Indiana must file and pay their sales and withholding taxes electronically through INtax.

    There are several options available to taxpayers wishing to file and pay their taxes.

    • INtax – If you are filing and paying sales, withholding, out-of-state sales, prepaid sales, metered pump sales, fuel taxes, wireless prepaid fees, and type II gaming taxes, you are required by law to electronically file and pay these taxes. The easiest way is through INtax.
    • INtax allows you to:
      • File and pay tire fees
      • Have 24/7 access to business tax records
      • File and pay online up to the deadline
      • Securely communicate with the Department
    • Once you have received your INtax Access Code, download an INtax QuickStart Guide to get started.
    • Electronic Funds Transfer – You have the options to sign up and pay through EFT. The available choices to pay are ACH Debit and ACH Credit. For more information about filing using EFT, please call (317) 232-5500.
    • Paper Filing – Mail a paper return and pay with a check or money order if it is not a tax type that must file electronically.
  • What determines my filing frequency and the due dates associated with each frequency?

    The filing frequency is based on the average monthly liability throughout the tax year. Remember, your filing status can be changed if there is an increase or decrease in the amount of tax you owe throughout the year. You will be notified of any changes to your filing status before the beginning of the next tax year. Also, if your average monthly tax exceeds $5,000, you are required to make payments by Electronic Funds Transfer. Call (317) 233-4015 if you have questions on your filing status.

  • Can I change how often I file my tax returns?

    Yes. You can increase how often you file your returns, but you can’t decrease how often you file. All business accounts are reviewed in November and any filing status changes are made at that time.

  • If I need to add a tax type to a previously registered account can I do this at any time?

    Yes. Simply file an updated Business Tax Application.

  • Why do I have to fill out a different application for each business and/or location?

    Each separate location collecting sales tax is required to have a Registered Retail Merchant Certificate displayed in each place of business.

  • Can I consolidate all of my companies under one Indiana taxpayer identification number?

    If the companies are separate entities with different federal identification numbers then you cannot consolidate under one taxpayer identification number. However, if you have multiple locations under the same federal identification number you can consolidate under one Indiana TID. If you believe that your structure creates unique filing challenges, you may contact DOR to discuss other filing options.

    If you want to consolidate tax filings for all or some of your locations, you can complete Form BT-1C (Authorization for Consolidated Sales Tax Filing Number).

    To avoid delays in processing applications, please make sure all the applicable information is compete and the form is signed by a Responsible Officer of the company. Please note that the application will be delayed if the business itself has any outstanding tax liabilities.

    When you close your business, you are responsible for notifying the Indiana Department of Revenue of the closure. This is typically done by filling out a BC-100 (Business Closure Request Form). Failure to do this can result in billings being issued for failure to file returns.

  • Does the State of Indiana have a Voluntary Disclosure Program?

    Yes, Indiana has a Voluntary Disclosure Program. If you want to know more about the Voluntary Disclosure Program, you may contact the Department anonymously. The Department will not in any way seek to identify you if you wish to remain unidentified. To remain anonymous when making the formal application, you can engage a representative, such as a tax preparer, an accountant, or an attorney.

    For more information, click here.

  • How do I resolve a tax protest?

    You should have received a letter stating the specifics of your tax protest. The letter will spell out the exact reason(s) for the protest and the steps you must take to resolve it.

    You may call (317) 232-5977 to speak to a representative of the Indiana Department of Revenue regarding your specific case.

  • How does a corporation obtain a Letter of Good Standing?

    You must submit a written request from a corporate officer or from an authorized representative (a Power of Attorney must be submitted if not an officer). Only original documents are accepted. The request must be on the organization's letterhead and contain the following:

    1. Official name of the organization
    2. Address of the organization
    3. Federal Identification Number (FEIN)
    4. Date of Incorporation in Indiana or date qualified to do business in Indiana
    5. Corporate officer's signature and title (must be an original signature)
    6. Name and the FEIN of the reporting organization if the organization files as a member of a consolidated group
    7. Other pertinent information, such as a deadline*
    8. Mailing instructions - complete address of where the letter is to be mailed if different from the corporate address

    *Due to the significant amount of research required, the approval for a Letter of Good Standing may take 20 to 30 business days for issuance.

    Note: All tax returns must be on file and all liabilities must be satisfied before the request will be approved.

    Questions may be directed to (317) 232-0129 from 8 a.m. to 4:30 p.m.

    Mail the completed request to:
    Indiana Department of Revenue Customer Service
    P.O. Box 6197
    Indianapolis, In 46206-6197

  • My corporation has been administratively dissolved by the Indiana Secretary of State. How do I obtain a Clearance for Reinstatement from the Indiana Department of Revenue?

    You will need to submit an Affidavit for Reinstatement (Form AD-19) for an organization that is located in Indiana, or a Form AD-19(2) for an organization located outside Indiana. All requests for reinstatement are reviewed in the order received, with the review process normally taking 20 to 30 business days. You will be notified by mail if any additional information is needed. If someone other than the officer completing the affidavit is to receive information from our office, a notarized Power of Attorney authorizing us to release information must be submitted with your request for reinstatement.

    When the affidavit has been approved, the clearance will be mailed to you at the address submitted on the affidavit unless we receive written instructions for correspondence to be mailed elsewhere. You must then submit the original reinstatement clearance to the Indiana Secretary of State with any other paperwork they require. Our reinstatement clearance is valid for 60 days from the date of issue. If time has expired, the clearance will be rejected by the Secretary of State and you will need to start the reinstatement process again by submitting a new AD-19 or AD-19(2) to the Department.

    For more information, you may call (317) 232-0129 from 8 a.m. to 4:30 p.m.

    Mail the completed request to:
    Indiana Department of Revenue Customer Service
    P.O. Box 6197
    Indianapolis, IN 46206-6197

  • How do I obtain a tax clearance on my license?

    Indiana tax clearance can be obtained by meeting the following requirements:

    • All tax returns must be filed up-to-date.
    • All outstanding delinquencies must be paid in full.
    • All payments must be made using guaranteed funds
  • How do I get a private employment agency license?

    To obtain a new license as a private employment agency there are many steps including forms and fees.

  • Why is there a tax lien on my vehicle title?

    This is often due to a stage of collection issued by the Department. For more information, click here.

Sales Tax


  • How much is Indiana’s sales tax?

    Indiana’s sales tax is seven percent.

  • Is a Registered Retail Merchant Certificate (RRMC) the same as a vendor’s license?

    No. You will need to contact your county clerk’s office to apply for a vendor’s license. We will issue an RRMC when the Business Tax Application is processed.

  • Am I required to renew my Registered Retail Merchant (RRMC) Certificate?

    Yes. The RRMC must be renewed every two years. If all tax filings and payments are current, you will automatically be sent your renewed certificate. If the business account is missing returns or if there is a balance due to the department, the RRMC will be held until the account is current.

  • How do I make sales-tax exempt purchases?

    If you are buying items that qualify for a sales-tax exemption you can fill out Form ST-105. You provide the merchant with the ST-105 for their records. The merchants will keep the ST-105 for their audit records. You may contact us at (317) 233-4015 with specific tax exemption questions.

  • What if I am entitled to an exemption but I do not have an Indiana taxpayer identification number, nor do I have a business license or registration number from my home state?

    You have three options:

    Option #1 – The ST-105 form instructions detail other options available to those businesses entitled to exemption, but do not meet the requirements of this form.

    Option #2 - You may register with Indiana for free via INBiz. Register for "Out-of-State Use Tax" to obtain a taxpayer identification number. Registration will require you to begin collecting Indiana sales tax on sales shipped (sourced) to Indiana locations, unless you receive an exemption certificate from your Indiana customers.

    Option #3 - If you can not perform either option above but are entitled to an exemption, you must pay the Indiana sales tax to your vendor and then file for a refund directly with the Indiana Department of Revenue. You will need to file Form GA-110L with the Department.

  • What is Use Tax?

    Use tax is due on property brought into Indiana for use, storage or consumption. Exceptions for this tax may be found in the Indiana Code (IC 6-2.5-5 and IC 6-2.5-3).

  • Which purchases that I make on the Internet or out-of-state are taxable?

    All purchases are subject to the sales tax. If tax is not collected from you by the seller, you are required to remit use tax on the purchase price.

  • What is the difference between use tax and sales tax?

    Both taxes are complimentary and are meant to assure the state gross retail tax of seven percent is paid upon a purchase. Use tax accrues when a purchase is not subjected to sales tax at the time of purchase. 

    If a purchaser does not pay a sales tax to the seller, the purchaser still has a use tax responsibility. The purchaser will pay the use tax owed on his or her annual Indiana income tax return (due April 15).

    Retail merchants with an Indiana location(s) or merchants that do not have a physical location in Indiana but meet one or both of the following conditions in the previous calendar year or the current calendar year ​are required to register their business and pay a one-time $25 registration fee, per location:

    1. You have gross revenue from sales into Indiana exceeding $100,000; or
    2. You have 200 or more separate transactions into Indiana.

    An out-of-state seller that does not meet the requirements for sales tax registration, may voluntarily register to collect the Indiana use tax without incurring a registration fee.

  • How can I purchase tangible personal property from Indiana vendors without paying the sales tax if I am qualified to purchase such items for a statutory exempted purpose?

    The ST-105 General Sales Tax Exemption Certificate is a multiuse form that can be used by most exempt purchasers. Most exempt purchasers, in-state and out-state purchasers, may use this form for most types of Indiana allowed exemptions.

  • What happened to the exemption forms listed below?

    ST-104 Agricultural Single Purchase Exemption
    ST-106 Agricultural Blanket Purchase Exemption
    ST-134 Exemption for Construction Contractors
    ST-135SB Sales and Use Tax Exemption (school bus operators)
    ST-136A Out-of-State Purchaser's Exemption Affidavit

    All of the above exemptions have been included on the ST-105 General Sales Tax Exemption Certificate. As such, the ST-104, ST-106, ST-134, ST-135SB and ST-136A have been deleted from our forms menu.

  • What are Indiana's previous sales tax rates?

    The tax rate from December 2002 to March 2008 was 6%. Older state tax rates can be found on the sales tax rate history webpage.

  • When can a customer report/remit sales tax using an accrual method?

    IC 6-2.5-6-1 addresses the payment of sales tax.

    The option of using the accrual method is addressed in IC 6-2.5-6-2. In order to use the accrual method, the merchant must use the accrual method for determining adjusted gross income tax(AGI). Absent the use of the accrual method for income tax, the retail merchant must use the cash method.

    Thus, a retail merchant can use the accrual method without DOR consent. However:

    • The merchant MUST report adjusted gross income tax on an accrual basis
    • The merchant can use the cash method for sales tax and accrual method for adjusted gross income tax
    • DOR can request that the merchant stop using the accrual method at any time

Use Tax Liability


  • Who owes Indiana use tax?

    Generally, any type of business entity (individual, partnership, corporation, etc.) that makes purchases of tangible personal property is subject to use tax unless it previously paid at least a seven percent sales tax on the purchase to the vendor. Use tax can be thought of as a mirror of the sales tax. Both our sales tax and use tax rates are seven percent.

    Use tax is due on property brought into Indiana for use, storage or consumption, unless the Indiana Code (IC 6-2.5-5) contains an applicable exemption for your purchase. If you paid at least seven percent sales tax at the time of purchase, you do not owe a use tax. However, if you did not pay at least a seven percent sales tax, you may owe use tax.

  • What type of purchases might cause me to become liable for use tax?
    • Purchases from vendors that are not registered to collect Indiana sales or use tax.
    • Items withdrawn from your inventory for personal use or to give away
    • Any purchase for which a statutory exemption is not available per the Indiana Code (IC 6-2.5-5)
  • What are some common examples of purchases I may make that become subject to the Indiana use tax?
    • A dentist operates his/her business as a sole proprietorship. The dentist buys toothbrushes from an unregistered out-of-state supply house to give away to his/her patients during their annual exams. The vendor did not collect any sales tax on this sale. The dentist owes seven percent use tax on these purchases because no statutory exemption exists for this type of item when given away. The dentist should report the use tax on Form ST-115.
    • An auto repair shop purchases shop rags and other cleaning materials from an unregistered out-of-state vendor. The vendor did not collect sales tax on the invoice. The auto repair shop should report these purchases on its next sales tax return, Form ST-103, because it’s subject to use tax.
    • A manufacturer purchases new office furniture for use in its corporate office from an out-of-state distributor. The office furniture is delivered to the manufacturer's warehouse outside of Indiana. The distributor collects the delivery state's six percent sales tax on the selling price. The manufacturer owes an additional one percent Indiana use tax on this purchase because the property is being used, stored or consumed within Indiana. When it transports the office furniture into Indiana, the manufacturer should report this use tax liability on its ST-103 sales tax return.
    • A law firm maintains an extensive legal library. Many of its legal books, manuals and publications are from out-of-state publishers who are not registered and do not collect sales tax on items shipped into Indiana. The law firm owes seven percent Indiana use tax on these type of purchases and can remit these on its ST-103 return if it is a registered retail merchant, or it can use Form ST-115.
    • An individual orders magazines, clothing and novelty items from various unregistered out-of-state catalog companies. Sometimes the individual orders the items via mail, sometimes via the telephone and sometimes online. This individual should report these purchases to Indiana as being subject to our use tax of seven percent. The individual can report these purchases on his/her Individual Income Tax Returns (IT-40, Schedule 4; IT-40PNR, Schedule E) or can use Form ST-115.
  • What about items I purchase at garage sales and auctions?

    Items sold at garage sales are generally exempted under Indiana's casual sale statute. A casual sale exemption is applicable when the seller is not in the "business" of selling merchandise and the seller has already paid an original sales or use tax on the item. (IB #20)

    Items purchased at auctions are slightly more complex. Naturally, if the auctioneer collects the seven percent sales tax, you will not owe any additional use tax. Also, if the auction takes place on the premises of the owner of the tangible personal property, the items are considered to be "casual sales" and are therefore exempt from sales and/or use tax. However, if the merchandise to be auctioned is moved to a location not owned by the owner of the merchandise, the sales become subject to sales and/or use tax. All sales at auction "houses" are subject to the sales or use tax. (IB #20)

  • What if I've paid sales tax to another state?

    The Indiana use tax rate is seven percent, same as our sales tax rate.

    • If you paid sales tax of seven percent or more to the other state, you do not owe use tax to Indiana.
    • If you paid sales tax of less than seven percent to the other state, your Indiana use tax will be the difference between the Indiana seven percent use tax and the amount you paid to the other state.
  • Why should I report and pay the Indiana use tax?

    If you self-report the use tax due, you will only owe the tax. If you wait until the Department of Revenue issues you a bill for the use tax due, you will have to pay a ten percent penalty, plus interest. The Indiana Code requires use tax to be paid unless at least an equal amount of sales tax was paid on your taxable purchases. IC 6-2.5-3-2

Withholding Tax


  • How do I figure Indiana state withholding tax for my employees?

    Departmental Notice #1 explains how to withhold taxes on employees. The current state withholding tax rate is 3.23 percent. The county tax rate will depend on where the employee resided or worked as of Jan.1. If you have more questions please call (317) 233-4015.

  • How do I contact the Indiana Department of Revenue for help with withholding income tax?
  • Who are withholding agents?

    Withholding agents are employers who are required by the Internal Revenue Service to withhold income tax on salaries, wages, tips, fees, bonuses and commissions.

    To find out if you should withhold state and county taxes for your employees, contact the Internal Revenue Service at (800) 829-4933. If you are required to withhold federal taxes, then you must also withhold Indiana state and county taxes.

    Withholding payments must be made to the Department by the due dates or penalties and interest will be assessed. If you do not file a return and pay the proper amount of tax, you will face criminal prosecution for fraud or tax evasion.

  • How do I register as a new withholding agent?

    Register with the department via INBiz. If you registered with the Department previously, you must add the withholding tax type when you add your first employee.

    The responsible officer of your organization may register the business via INBiz. Processing time for the online application may take up to two business days.

    Once you have registered, you will receive an Indiana Taxpayer Identification Number that allows the business to be identified in the Department’s system.

  • What information do I need to collect from my employees?

    Employees should complete an Employee’s Withholding Exemption and County Status Certificate (WH-4). This form provides the department with:

    • The number of exemptions the employee will claim.
    • The county the employee is living and working in so that the proper county tax rate can be figured.

    Both the employer and the employee should keep a copy of the WH-4 for their records. The employee should update the WH-4 when the information changes, such as the number of exemptions.

  • What do I do if my employees work in Indiana, but live in another state?

    Employers must withhold Indiana state tax from the employees’ wages unless the employees live in a state that has a Reciprocal Agreement with Indiana. For a complete list of reciprocal states, please read Information Bulletin #33 or call (317) 233-4016.

    Important: Employers must withhold Indiana county tax from reciprocal state employees who work in Indiana as of January 1 of the year.

  • Do I have to withhold state taxes for part-time or summer employees?

    Yes. Part-time or summer employees are treated the same as full-time employees.

  • Are there any cases I would not have to withhold state or county taxes for an employee?

    Casual laborers, some domestic employees, ministers and those who receive pension annuities may choose not to have tax withheld from their earnings. However, their income is still subject to state and county tax. If you have questions about your specific situation, please call the Department at (317) 233-4016.

  • How do I make my payments to the department?

    You can use INTax, Indiana's free online tax filing program, which allows you to file and pay your business taxes and much more. With INTax, you can manage your obligations for Indiana retail sales, out-of-state sales, prepaid sales, metered pump sales, tire fee, fuel tax and withholding taxes.

    Customers with average monthly withholding tax payments of more than $5,000 must submit their payments via electronic funds transfer before their due date. All other withholding agents may make their payments via EFT or mail.

    Those withholding agents who must file early, monthly, or quarterly will receive the Indiana Employer’s Withholding Tax Return (WH-1). The WH-1 should be completed and returned to the department on or before the due date. All Indiana withholding agents are required to complete and file an annual reconciliation form (WH-3) no later than 31 days after the end of the calendar year. Any business that files more than 25 W-2, W-2G, or 1099-R statements (showing Indiana state/county withholdings) must do so electronically. Electronic filing of these forms generates an electronic WH-3, so no paper form should be filed.

    If you have more questions on withholding tax, please call the Department at (317) 233-4016.

  • What records do I need to keep as a withholding agent?

    You should have a correct list of all employees, which includes:

    • List of who is employed by the month, week, or day
    • Length of a normal pay period
    • Salaries
    • Social Security numbers
    • County of residence as of January 1 of the tax year
    • County of work
  • What information should I provide my employees for their records?

    You should provide each employee with a statement of the amount of state and county tax withheld. This is usually shown on the federal Wage and Tax Statement (W-2). The employee must get a copy of this form by Jan. 31. A copy of the W-2 should also be sent to the department by Feb 28. If you have more questions about withholding income tax call (317) 233-4016.

  • How does the department Determine when my withholding payments are due?

    We use the average anticipated monthly wages that are paid to your employees. If there is a significant increase or decrease in your average monthly tax withheld, your filing status will be adjusted.

    Monthly average tax withheld Filing Status Due date(s)
    $10 or less Annual 30 days after the end of the month
    $1,000 or less Monthly 30 days after the end of the month
    More than $1,000 Early filer

    20 days after the end of the month

W-2 and WH-3 Electronic Filing


Composite Filing & Nonresident Withholding


IT-6WTH


Billing


  • How do I get information about my tax bill?

    You can inquire about a tax bill by using the Department’s automated information line. This information line is available Monday through Saturday 7 a.m. to 10 p.m. You can find out your current balance due on any individual or business tax liability by calling (317) 233-4018.

    You will need to have your taxpayer identification number or Social Security number and the liability number or warrant number available when you call. This information is on the notice that you have received.

  • What are my rights as an Indiana taxpayer?

    All Indiana taxpayers have certain rights and responsibilities that correspond to the Indiana tax laws.

    • Quality taxpayer service
    • Taxpayer Advocate to help taxpayers in the preservation of their rights
    • Taxpayer education and information
    • A fair collection process
    • Appointed hearing time and representation
    • Demand Notices
    • Warrants for collection of tax
    • Judgment liens against property
    • Annual Public Hearing and Department Report

    You can find more information on what these rights mean in the Taxpayer Bill of Rights.

  • What are my responsibilities as an Indiana taxpayer?

    Your responsibilities as an Indiana taxpayer:

    • File your tax returns and pay any taxes due on time.
    • Notify us in writing when you have an address change.
    • Know the tax laws that relate to you as an individual or a business, and comply with those laws.
    • Contact us if you have any questions or concerns.
  • How do I pay my tax bill?

    If you are a business wanting to pay your Indiana retail sales, out of state sales, prepaid sales, metered pump sales, tire fee, fuel tax and payroll withholding taxes you can use INtax, Indiana's free online tax filing program that allows you to file and pay your business taxes and much more.

    The Department accepts MasterCard, Visa, American Express (by phone only), debit cards, electronic checks, check or money order.

    A check or money order should be made payable to the Indiana Department of Revenue at:

    Indiana Department of Revenue
    P.O. Box 595
    Indianapolis, IN 46206-0595

  • What is the Department’s delinquent tax collection process?

    Every Indiana customer has the right to a fair collection process. You have the right to protest a liability. If you protest a liability, the department is required to conduct a hearing on that case. You are entitled to be represented at your hearing when your case is presented. If a liability is not paid or protested within 60 days of the first notice, we will issue a "Demand Notice" for payment before issuing a tax warrant. If we do not receive a payment, a warrant for the collection of tax will be issued. When a tax warrant is filed with your county clerk, it becomes a judgment lien (levy) against all your property within the county. The Department intends for you to have every opportunity to rectify your account balance whether it is paying it right away or protesting it.

    Read about the collection process.
    Know your rights and responsibilities as an Indiana taxpayer .

Power of Attorney


Aircraft


Auto, Watercraft, RV and Trailer Dealers


  • Show All Answers For This Section I am an Indiana licensed dealer. What form of documentation do I need to document sales tax exemption when selling or trading vehicles, trailers or watercraft with out-of-state dealers?

    Out-of-state dealers have three options available to purchase vehicles, trailers or watercraft exempt from the Indiana sales tax.

    Option #1 - If the out-of-state dealer has Indiana customers and the out-of-state dealer delivers vehicles, trailers or watercraft into Indiana to anyone other than other dealers, registration is required. They may register with the Department of Revenue at no cost, electronically, from the department's website.

    Click on "Register a New Business Online." This is a free registration. You should receive your registration within 48 hours.  If you are an out-of-state dealer delivering vehicles or watercraft into Indiana to nondealers, you must register. This registration requires you to file sales tax returns with Indiana and to collect Indiana sales/use tax on any vehicles or watercraft delivered into Indiana for sales to persons who do not have a valid exemption available. You will have to file sales tax returns even if your sales are zero for any particular reporting period.

    Option #2 - An out-of-state dealer that is not required to register with Indiana, as described in Option #1, may issue a single purchase form exemption certificate, ST-108E, with the selling Indiana dealer. The out-of-state dealer must disclose both its Federal Identification Number and state of residence vehicle or watercraft dealer license number on this form in lieu of registration with the Department of Revenue. The dealer license number is to be shown on the same line as the dealer name located at the top of the form.

    Option #3 - An out-of-state dealer that is not required to register with Indiana can issue an ST-105D Dealer to Dealer Resale Certificate with the Indiana dealer, which can be used as a single or blanket purchase exemption certificate. Disclosure of the out-of-state dealer's Federal Identification Number and dealer license number must be shown on this form in lieu of registration with the Department of Revenue.

  • I possess a manufacturer's franchise to sell specific vehicle models as "new." Must I collect the sales tax even though the sale is to another dealer?

    You are correct. Effective July 1, 2003, the "resale" exemption is not valid for any new vehicle sold to another dealer if the vehicle being sold is to a dealer not possessing a manufacturer's franchise to sell the type of new vehicle being purchased. The dealer must collect the Indiana sales tax if selling a new vehicle to a nonfranchised new vehicle dealer. See I.C. 6-2.5-5-8 for details.

  • My customer lives in another state. If I charge him Indiana sales tax, will he have to pay the sales tax again when he registers and/or title his purchase in his home state?

    All states are mandated to give credit for a legally imposed sales tax paid to one state against another state's sales/use tax. This is due to the United States Commerce Clause. So, if your customer lives in another state, that state should allow the amount of sales tax paid to Indiana as a credit against the amount of sales or use tax due. Your customer may have to pay an additional amount if his home state has a higher tax rate than Indiana or if his state has any local (non-state) imposed taxes. Example: California currently has a state rate of 7.25 percent plus local taxes. If the Indiana sales tax of seven percent is paid at the time of purchase, your customer will have to pay only California’s extra .25 percent state sales tax plus any local taxes due in California. He will get credit for the seven percent paid to Indiana, thus no double-taxation. (see warning below)

    Warning - A few states impose a tax different from a sales/use tax, often termed an excise tax. Because the tax is not the same type of tax as Indiana’s sales tax, these states may not allow a credit for a sales tax paid in Indiana against their tax. A few states might have specific tax statutes that do not allow for a credit for a sales tax paid to another state. States known to the Indiana Department of Revenue that might not allow a credit for a sales tax paid to Indiana are Arkansas, Mississippi and West Virginia. These states may impose additional taxes upon registration and/or titling in their state without allowing a credit for the sales tax paid to Indiana. This list might not be all-inclusive. It is provided solely to alert dealers and customers of the existence of these types of situations.

  • My customer lives in another state that has a sales tax rate lower than the Indiana 7 percent tax rate. Will the buyer be entitled to a refund for the difference in tax rates?

    A law passed during the 2014 legislative session calls for the motor vehicle dealer (retailer) to collect sales tax at the rate the buyer would pay in his/her home state. The purchaser must sign an affidavit certifying that the vehicle will be transported outside Indiana within 30 days after delivery, and will be titled or registered in another state or country. The Indiana motor vehicle dealer will complete and retain form ST108NR to document this sale. This form includes the affidavit to be signed by the buyer and identifying vehicle information. The Indiana dealer will charge sales tax at the prescribed state tax rate in effect, which may be found on here.

  • My customer lives in a state that does not have a sales tax. Does he still have to pay the Indiana sales tax?

    No, the customer will not have to pay Indiana sales tax, as long as the buyer completes the ST108NR affidavit and the dealer verifies the state of registration has no sales tax due.

  • I have a customer from a foreign country. Do I collect sales tax on this sale?

    Yes, all sales of motor vehicles in Indiana are subject to Indiana sales tax if physical possession of the vehicle transfers to the buyer in Indiana. Sales tax is due unless the customer is entitled to an exemption listed on the back of the ST108E, but the rate of sales tax to be collected may be something other than seven percent for transactions. Sales of motor vehicles to residents of other countries who will be transporting and registering the vehicle in that country will be taxed at the rate the buyer would pay in that country. If the tax rate in that country exceeds Indiana’s sales tax rate of seven percent, only seven percent should be collected by the motor vehicle dealer.

  • What are some of the other exemptions my customer might claim?

    The back of the ST-108E form lists all the available statutory exemptions. Some of the exemptions available are for sales to nonprofits, governmental agencies, the federal government, vehicles to be used for hire in public transportation, sales to other dealers for resale etc.

  • As a condition of a sale, a dealer delivers the vehicle, watercraft, trailer or aircraft across the state line into another state or country where the customer takes physical possession of her purchase. Is this transaction exempt from the IN sales tax?

    This is an example of a “sale in interstate commerce.” The United States Commerce Clause outlines provisions that regulate sales conducted in interstate commerce. The term “interstate commerce” is applicable any time a seller delivers tangible personal property across a state line. Note: this is an exemption for a seller, not for the purchaser. A purchaser or a purchaser’s hired delivery service that picks up property within Indiana is an example of an “intrastate sale” and thus is subject to the Indiana sales tax.

    The interstate sales exemption applies if either the selling dealer personally delivers the vehicle or the selling dealer hires a third-party common carrier to deliver the vehicle to a point outside Indiana.

    • Delivery Made by a Dealer – If a dealer delivers vehicles themselves, shipping documentation must be kept. The selling dealer’s purchase order must show the:
      • Method of delivery
      • Specific delivery location
      • Date of delivery
      • Signature of the purchaser (confirming the vehicle was inspected and accepted outside Indiana)
      • Delivery price (if applicable)

    Please note that a dealer that delivers property into another state without the use of a third-party common carrier is often considered to be doing business in that state and may be subject to that state’s sales tax laws. A dealer might be required to register and collect that state’s sales tax where the vehicle is delivered even though they would be exempt from collecting the Indiana sales tax.

    • Delivery by a Third-Party Carrier – If a delivery is made via a third-party delivery carrier, the selling dealer must indicate on the purchase order (sales invoice) that the item sold is being delivered outside Indiana and must keep a copy of the delivery bill-of-lading from the delivery carrier as evidence of the out-of-state delivery. The bill-of-lading must show the:
      • Method of delivery
      • Specific delivery location
      • Date of delivery
      • Recipient of the delivery
      • Delivery price (if applicable)

    Note: A purchaser who picks up property within Indiana, or a purchaser that hires his own delivery service to pick up his purchase in Indiana, is an example of an "intrastate sale" and thus is subject to the Indiana sales tax.

  • I am an RV and/or cargo trailer dealer.,I have a customer who is a nonresident of Indiana. Should I collect the Indiana seven percent sales tax on the sale to this customer?

    Yes, nonresidents are subject to Indiana’s seven percent sales tax unless they register or title their purchase in a “reciprocal” state within 30 days of purchase. A state is reciprocal with Indiana if the other state would allow an Indiana resident to purchase exempt from that state to be registered or titled in Indiana. No exemption exists for a customer who is registering or titling in a nonreciprocal state or country. A purchaser claiming an exemption must complete an ST-137RV affidavit of exemption form. The selling dealer must also complete this form and keep it filed at its place of business. Tax must be charged for the following nonreciprocal states or countries:

    Arizona Massachusetts
    California Michigan
    Florida Mississippi
    Hawaii North Carolina
    Kentucky * Rhode Island *
    Maine * South Carolina
    All nonresidents of the U.S. are taxable, except Canada.

    *Cargo trailers only are taxable in these states. RVs are exempt.

    Note: A sale to a nonresident that is determined to be subject to the Indiana sales tax due to registration/titling in one of the states or countries listed above may still be entitled to an exemption if they can legitimately claim one of the listed exemptions as shown on the back of the ST-108E form.

RVs and Cargo Trailers


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