Motorsports Tax Guidance
The Indianapolis Motor Speedway and surrounding area are designated as a motorsports investment district (MID) for the purpose of financing capital investments at the Indianapolis Motor Speedway.
The Indiana Department of Revenue (DOR) is required to report the amount of retail sales tax and state adjusted gross income tax attributable to activities within the MID.
Motor Sports Investment District (MID) Filing Requirements
Merchants engaged in retail trade within the MID are required to report information on their retail sales and income payments attributable to motorsports racing activities.
Retail merchants use Form MID to report the amount of sales made within the MID and the amount of withholding on salaries or wages paid to employees for work performed within the MID. Additionally, retail merchants must report compensation (including cash) made to contractors for providing services.
Form MID is due April 1 of each year. Sales, withholding, and compensation from the previous year must be reported on this form.
Form MID can be submitted it to DOR at the mailing address below.
Professional Racing Teams Filing Requirements
Under existing law, income earned in Indiana by an individual participating in motorsports racing activities is subject to Indiana’s adjusted gross income tax regardless of place of residence. The Indiana portion of the income is a percentage calculated by of the number of days spent in Indiana participating in racing activities divided by the days spent during the year on racing activities. Commissioner's Directive #51 provides guidance regarding the statutory withholding requirements on prize winnings and other payments for motorsports teams and drivers
Professional racing operations use Form IMS-1 to report the amount of compensation paid to team members in the organization at the MID. Race team members are employees or independent contractors who render services on behalf of a professional race team. Additionally, racing operations must report compensation (including cash) made to contractors, such as race drivers, for providing services. Retail sales made within the MID also must be reported on Form IMS-1, due April 1. Compensation and retail sales from the previous year will be reported on the form.
Form IMS-1 can be submitted it to DOR at the mailing address below.
Out-of-State Professional Racers Filing Requirements
Any out-of-state professional racer who receives income resulting from a race event held in Indiana must withhold 3.3 percent and report it to the Indiana Department of Revenue during the period it was paid. An out-of-state professional racer is defined as someone who races for a living, doesn't hold another occupation, and is not an Indiana resident. The Indiana portion of the income is equal to the total income for the year times Indiana duty days divided by total duty days.
A race team with race team members who are nonresidents of Indiana may file a composite return to report the withholding for the nonresident individual employees or independent contractors who elect to be included in the composite return by signing an Indiana Composite Filing Affidavit.
To report withholding and duty days, complete Form IMS-1 and submit it to DOR at the mailing address below.
For more information about motorsports tax guidance requirements, you may contact DOR at 317-234-8614, Monday through Friday, 8 a.m. - 4:30 p.m., EST.
All MID information can be sent to DOR at:
Indiana Department of Revenue
100 N. Senate Ave.
RM 248, MS 103
Indianapolis, IN 46204