The Indiana General Assembly designated the Indianapolis Motor Speedway (IMS) and selected surrounding areas as a motorsports investment district (MID) to finance capital investments at the race track.
DOR is required to report the amount of retail sales tax and state adjusted gross income tax attributed explicitly to activities within this area annually.
As a result, those who work at and around IMS are subject to unique tax requirements not found at other race tracks. Operators, sanctioning bodies, race teams, and team members* should review the information below to ensure compliance with existing tax laws and regulations.
*The term "race team member" or "team members" includes employees or independent contractors who render services on behalf of the race team. The term includes, but is not limited to: drivers, pit crew members, mechanics, technicians, spotters, crew chiefs, and any other individuals whose activities directly impact the race car during a race, practice, qualification, training and testing.
All income earned in Indiana is subject to state income tax regardless of the individual's place of residence or where the employer is based. Professional racing operations such as race teams are responsible for all necessary tax filings related to the MID, corporate/partnership tax filings and employee withholding.
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 conducting retail trade within the MID on behalf of the merchant.
Form MID is due April 1 of each year. Sales, income tax withholding and compensation from the previous year must be reported on this form.
Form MID can be mailed to DOR at the 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. For nonresidents, the Indiana position of income is a percentage calculated by dividing the number of days spent in Indiana participating in racing activities by the days spent during the year on racing activities. Income Tax Information Bulletin #88B 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 for performing services within 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 by or on behalf of a racing team also must be reported on Form IMS-1, due April 1.
Form IMS-1 can be submitted it to DOR at the mailing address below.
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.
Out-of-State Professional Racers Filing Requirements
Any out-of-state professional racer who receives income resulting from a race event held in Indiana is subject to the State’s 3.23% income tax plus the county income tax rate applicable to the county where the race event was held unless that income and tax has been reported on a nonresident race team members’ composite return. However, if the out-of-state-professional racer files an IT-40PNR, the income resulting from a race event held in Indiana must be reported even if the race team filed a composite return on behalf of the racer.
An out-of-state professional racer is defined as someone who races for a living, whose primary occupation is race car driving, and is not an Indiana resident. The Indiana portion of taxable income is equal to total income for the year times the number of Indiana duty days divided by the total number of duty days in the year. Drivers in IndyCar and NASCAR races, including secondary series, will always be considered professional drivers.
- Motorsports Tax Forms
- Indianapolis MID Boundary Map (last modified in 2017)
- Income Tax Information Bulletin #88B - Tax Withholding for Race Teams
- Additionally, you may subscribe to receive emails when select DOR publications are updated.
- Information on Sales Tax and Registered Retail Merchant Certificates (RRMC).
- Additional sales tax information can be found at in.gov/dor or by calling DOR at (317) 232-2240, Monday through Friday, 8 a.m. - 4:30 p.m., EST.
For more information about motorsports tax guidance requirements, you may contact DOR by email at Motorsports@dor.IN.gov or at (317) 232-2240, Monday through Friday, 8 a.m. - 4:30 p.m., EST.
All MID information can be sent to DOR at:
Indiana Department of Revenue
P.O. Box 6194
Indianapolis, IN 46206-6194
Other tax types have specific filing electronic filing requirements and/or addresses for mailing returns and other paperwork. Do not send tax filings, returns or paperwork other than that which is specifically required for the MID to the address above.