CHAPTER 3. USE TAX
IC 6-2.5-3
Chapter 3. Use Tax
IC 6-2.5-3-1
Definitions
Sec. 1. For purposes of this chapter:
(a) "Use" means the exercise of any right or power of ownershipover tangible personal property.
(b) "Storage" means the keeping or retention of tangible personalproperty in Indiana for any purpose except the subsequent use of thatproperty solely outside Indiana.
(c) "A retail merchant engaged in business in Indiana" includesany retail merchant who makes retail transactions in which a personacquires personal property or services for use, storage, orconsumption in Indiana and who:
(1) maintains an office, place of distribution, sales location,sample location, warehouse, storage place, or other place ofbusiness which is located in Indiana and which the retailmerchant maintains, occupies, or uses, either permanently ortemporarily, either directly or indirectly, and either by the retailmerchant or through a representative, agent, or subsidiary;
(2) maintains a representative, agent, salesman, canvasser, orsolicitor who, while operating in Indiana under the authority ofand on behalf of the retail merchant or a subsidiary of the retailmerchant, sells, delivers, installs, repairs, assembles, sets up,accepts returns of, bills, invoices, or takes orders for sales oftangible personal property or services to be used, stored, orconsumed in Indiana;
(3) is otherwise required to register as a retail merchant underIC 6-2.5-8-1; or
(4) may be required by the state to collect tax under this articleto the extent allowed under the Constitution of the United Statesand federal law.
(d) Notwithstanding any other provision of this section, tangibleor intangible property that is:
(1) owned or leased by a person that has contracted with acommercial printer for printing; and
(2) located at the premises of the commercial printer;
shall not be considered to be, or to create, an office, a place ofdistribution, a sales location, a sample location, a warehouse, astorage place, or other place of business maintained, occupied, orused in any way by the person. A commercial printer with which aperson has contracted for printing shall not be considered to be inany way a representative, an agent, a salesman, a canvasser, or asolicitor for the person.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.70-1993,SEC.2; P.L.81-2004, SEC.3.
IC 6-2.5-3-2
Imposition Sec. 2. (a) An excise tax, known as the use tax, is imposed on thestorage, use, or consumption of tangible personal property in Indianaif the property was acquired in a retail transaction, regardless of thelocation of that transaction or of the retail merchant making thattransaction.
(b) The use tax is also imposed on the storage, use, orconsumption of a vehicle, an aircraft, or a watercraft, if the vehicle,aircraft, or watercraft:
(1) is acquired in a transaction that is an isolated or occasionalsale; and
(2) is required to be titled, licensed, or registered by this statefor use in Indiana.
(c) The use tax is imposed on the addition of tangible personalproperty to a structure or facility, if, after its addition, the propertybecomes part of the real estate on which the structure or facility islocated. However, the use tax does not apply to additions of tangiblepersonal property described in this subsection, if:
(1) the state gross retail or use tax has been previously imposedon the sale or use of that property; or
(2) the ultimate purchaser or recipient of that property wouldhave been exempt from the state gross retail and use taxes ifthat purchaser or recipient had directly purchased the propertyfrom the supplier for addition to the structure or facility.
(d) The use tax is imposed on a person who:
(1) manufactures, fabricates, or assembles tangible personalproperty from materials either within or outside Indiana; and
(2) uses, stores, distributes, or consumes tangible personalproperty in Indiana.
(e) Notwithstanding any other provision of this section, the usetax is not imposed on the keeping, retaining, or exercising of anyright or power over tangible personal property, if:
(1) the property is delivered into Indiana by or for the purchaserof the property;
(2) the property is delivered in Indiana for the sole purpose ofbeing processed, printed, fabricated, or manufactured into,attached to, or incorporated into other tangible personalproperty; and
(3) the property is subsequently transported out of state for usesolely outside Indiana.
(f) As used in this subsection, "prepurchase evaluation" means anexamination of an aircraft by a potential purchaser for the purpose ofobtaining information relevant to the potential purchase of theaircraft. Notwithstanding any other provision of this section, the usetax is not imposed on the keeping, retaining, or exercising of anyright or power over an aircraft, if:
(1) the aircraft is titled, registered, or based (as defined inIC 6-6-6.5-1(m)) in another state or country;
(2) the aircraft is delivered to Indiana by or for a nonresidentowner or purchaser of the aircraft;
(3) the aircraft is delivered to Indiana for the sole purpose of
being repaired, refurbished, remanufactured, or subjected to aprepurchase evaluation; and
(4) after completion of the repair, refurbishment,remanufacture, or prepurchase evaluation, the aircraft istransported to a destination outside Indiana.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.26-1985,SEC.3; P.L.335-1989(ss), SEC.2; P.L.162-2006, SEC.20;P.L.211-2007, SEC.9.
IC 6-2.5-3-3
Rates; certain transactions defined
Sec. 3. The use tax is measured by the gross retail incomereceived in a retail unitary transaction and is imposed at the samerates as the state gross retail tax under IC 6-2.5-2-2. For purposes ofthis chapter, transactions described in IC 6-2.5-3-2(b) and (c) shallbe treated as retail transactions within the meaning of IC 6-2.5-1-2.
As added by Acts 1980, P.L.52, SEC.1. Amended by Acts 1981,P.L.78, SEC.1.
IC 6-2.5-3-4
Exemptions
Sec. 4. (a) The storage, use, and consumption of tangible personalproperty in Indiana is exempt from the use tax if:
(1) the property was acquired in a retail transaction in Indianaand the state gross retail tax has been paid on the acquisition ofthat property; or
(2) the property was acquired in a transaction that is wholly orpartially exempt from the state gross retail tax under any part ofIC 6-2.5-5, except IC 6-2.5-5-24(b), and the property is beingused, stored, or consumed for the purpose for which it wasexempted.
(b) If a person issues a state gross retail or use tax exemptioncertificate for the acquisition of tangible personal property andsubsequently uses, stores, or consumes that property for a nonexemptpurpose, then the person shall pay the use tax.
As added by Acts 1980, P.L.52, SEC.1.
IC 6-2.5-3-5
Credit for payment of other taxes
Sec. 5. A person is entitled to a credit against the use tax imposedon the use, storage, or consumption of a particular item of tangiblepersonal property equal to the amount, if any, of sales tax, purchasetax, or use tax paid to another state, territory, or possession of theUnited States for the acquisition of that property.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.26-1985,SEC.4; P.L.335-1989(ss), SEC.3; P.L.81-2004, SEC.4.
IC 6-2.5-3-6
Liability; payment; collection; computation
Sec. 6. (a) For purposes of this section, "person" includes an
individual who is personally liable for use tax under IC 6-2.5-9-3.
(b) The person who uses, stores, or consumes the tangiblepersonal property acquired in a retail transaction is personally liablefor the use tax.
(c) The person liable for the use tax shall pay the tax to the retailmerchant from whom the person acquired the property, and the retailmerchant shall collect the tax as an agent for the state, if the retailmerchant is engaged in business in Indiana or if the retail merchanthas departmental permission to collect the tax. In all other cases, theperson shall pay the use tax to the department.
(d) Notwithstanding subsection (c), a person liable for the use taximposed in respect to a vehicle, watercraft, or aircraft under section2(b) of this chapter shall pay the tax:
(1) to the titling agency when the person applies for a title forthe vehicle or the watercraft;
(2) to the registering agency when the person registers theaircraft; or
(3) to the registering agency when the person registers thewatercraft because it is a United States Coast Guarddocumented vessel;
unless the person presents proof to the agency that the use tax orstate gross retail tax has already been paid with respect to thepurchase of the vehicle, watercraft, or aircraft or proof that the taxesare inapplicable because of an exemption under this article.
(e) At the time a person pays the use tax for the purchase of avehicle to a titling agency pursuant to subsection (d), the titlingagency shall compute the tax due based on the presumption that thesale price was the average selling price for that vehicle, asdetermined under a used vehicle buying guide to be chosen by thetitling agency. However, the titling agency shall compute the tax duebased on the actual sale price of the vehicle if the buyer, at the timethe buyer pays the tax to the titling agency, presents documentationto the titling agency sufficient to rebut the presumption set forth inthis subsection and to establish the actual selling price of the vehicle.
As added by Acts 1980, P.L.52, SEC.1. Amended by Acts 1981,P.L.79, SEC.1; P.L.26-1985, SEC.5; P.L.335-1989(ss), SEC.4;P.L.18-1994, SEC.6; P.L.28-1997, SEC.8; P.L.182-2009(ss),SEC.175.
IC 6-2.5-3-7
Presumption of taxability; exemption certificate; verification forproperty used or consumed in providing public transportation
Sec. 7. (a) A person who acquires tangible personal property froma retail merchant for delivery in Indiana is presumed to have acquiredthe property for storage, use, or consumption in Indiana. However,the person or the retail merchant can produce evidence to rebut thatpresumption.
(b) A retail merchant is not required to produce evidence ofnontaxability under subsection (a) if the retail merchant receivesfrom the person who acquired the property an exemption certificate
which certifies, in the form prescribed by the department, that theacquisition is exempt from the use tax.
(c) A retail merchant that sells tangible personal property to aperson that purchases the tangible personal property for use orconsumption in providing public transportation under IC 6-2.5-5-27may verify the exemption by obtaining the person's:
(1) name;
(2) address; and
(3) motor carrier number, United States Department ofTransportation number, or any other identifying numberauthorized by the department.
The person engaged in public transportation shall provide a signatureto affirm under penalties of perjury that the information provided tothe retail merchant is correct and that the tangible personal propertyis being purchased for an exempt purpose.
As added by Acts 1980, P.L.52, SEC.1. Amended by P.L.211-2007,SEC.10.
IC 6-2.5-3-8
Receipt for payment; issuance; evidence of payment
Sec. 8. (a) When a retail merchant collects the use tax from aperson, he shall, upon request, issue a receipt to that person for theuse tax collected.
(b) If the department assesses the use tax against a person for theperson's storage, use, or consumption of tangible personal propertyin Indiana, and if the person has already paid the use tax in relationto that property to a retail merchant who is registered underIC 6-2.5-6, to the department, or, in the case of a vehicle or aircraft,to the proper state agency, then the person may avoid paying the usetax to the department if he can produce a receipt or other writtenevidence showing that he has so made the use tax payment.
As added by Acts 1980, P.L.52, SEC.1.