CHAPTER 26. HOOSIER BUSINESS INVESTMENT TAX CREDIT
IC 6-3.1-26
Chapter 26. Hoosier Business Investment Tax Credit
IC 6-3.1-26-1
"Base state tax liability"
Sec. 1. As used in this chapter, "base state tax liability" means ataxpayer's state tax liability in the taxable year immediatelypreceding the taxable year in which a taxpayer makes a qualifiedinvestment.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-2
Repealed
(Repealed by P.L.4-2005, SEC.148.)
IC 6-3.1-26-2.5
"Corporation"
Sec. 2.5. As used in this chapter, "corporation" means the Indianaeconomic development corporation established by IC 5-28-3-1.
As added by P.L.4-2005, SEC.102.
IC 6-3.1-26-3
"Director"
Sec. 3. As used in this chapter, "director" has the meaning setforth in IC 6-3.1-13-3.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-4
"Full-time employee"
Sec. 4. As used in this chapter, "full-time employee" has themeaning set forth in IC 6-3.1-13-4.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-5
"Highly compensated employee"
Sec. 5. As used in this chapter, "highly compensated employee"has the meaning set forth in Section 414(q) of the Internal RevenueCode.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-5.5
"Motion picture or audio production"
Sec. 5.5. As used in this chapter, "motion picture or audioproduction" means a:
(1) feature length film;
(2) video;
(3) television series;
(4) commercial;
(5) music video or an audio recording; or
(6) corporate production;for any combination of theatrical, television, or other media viewingor as a television pilot. The term does not include a motion picturethat is obscene (as described in IC 35-49-2-1) or television coverageof news or athletic events.
As added by P.L.199-2005, SEC.18.
IC 6-3.1-26-6
"New employee"
Sec. 6. As used in this chapter, "new employee" has the meaningset forth in IC 6-3.1-13-6.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-7
"Pass through entity"
Sec. 7. As used in this chapter, "pass through entity" means a:
(1) corporation that is exempt from the adjusted gross incometax under IC 6-3-2-2.8(2);
(2) partnership;
(3) trust;
(4) limited liability company; or
(5) limited liability partnership.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-8
"Qualified investment"
Sec. 8. (a) As used in this chapter, "qualified investment" meansthe amount of the taxpayer's expenditures in Indiana for:
(1) the purchase of new telecommunications, production,manufacturing, fabrication, assembly, extraction, mining,processing, refining, finishing, distribution, transportation, orlogistical distribution equipment;
(2) the purchase of new computers and related equipment;
(3) costs associated with the modernization of existingtelecommunications, production, manufacturing, fabrication,assembly, extraction, mining, processing, refining, finishing,distribution, transportation, or logistical distribution facilities;
(4) onsite infrastructure improvements;
(5) the construction of new telecommunications, production,manufacturing, fabrication, assembly, extraction, mining,processing, refining, finishing, distribution, transportation, orlogistical distribution facilities;
(6) costs associated with retooling existing machinery andequipment;
(7) costs associated with the construction of special purposebuildings and foundations for use in the computer, software,biological sciences, or telecommunications industry; and
(8) costs associated with the purchase of machinery, equipment,or special purpose buildings used to make motion pictures oraudio productions;
that are certified by the corporation under this chapter as being
eligible for the credit under this chapter.
(b) The term does not include property that can be readily movedoutside Indiana.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.103; P.L.199-2005, SEC.19; P.L.137-2006, SEC.6.
IC 6-3.1-26-9
"State tax liability"
Sec. 9. As used in this chapter, "state tax liability" means ataxpayer's total tax liability that is incurred under:
(1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);
(2) IC 27-1-18-2 (the insurance premiums tax); and
(3) IC 6-5.5 (the financial institutions tax);
as computed after the application of the credits that underIC 6-3.1-1-2 are to be applied before the credit provided by thischapter.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-10
Repealed
(Repealed by P.L.199-2005, SEC.40.)
IC 6-3.1-26-11
"Taxpayer"
Sec. 11. As used in this chapter, "taxpayer" means an individual,a corporation, a partnership, or other entity that has state tax liability.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-12
Purpose of credit
Sec. 12. The corporation may make credit awards under thischapter to foster job creation and higher wages in Indiana.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.104.
IC 6-3.1-26-13
Entitlement to credit
Sec. 13. A taxpayer that:
(1) is awarded a tax credit under this chapter by the corporation;and
(2) complies with the conditions set forth in this chapter and theagreement entered into by the corporation and the taxpayerunder this chapter;
is entitled to a credit against the taxpayer's state tax liability in ataxable year.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.105.
IC 6-3.1-26-14
Amount of credit Sec. 14. The total amount of a tax credit claimed for a taxableyear under this chapter is a percentage determined by thecorporation, not to exceed ten percent (10%), of the amount of aqualified investment made by the taxpayer in Indiana during thattaxable year. The taxpayer may carry forward any unused credit.
As added by P.L.224-2003, SEC.197. Amended by P.L.199-2005,SEC.20.
IC 6-3.1-26-15
Carry forward of credit
Sec. 15. (a) A taxpayer may carry forward an unused credit for thenumber of years determined by the corporation, not to exceed nine(9) consecutive taxable years, beginning with the taxable year afterthe taxable year in which the taxpayer makes the qualifiedinvestment.
(b) The amount that a taxpayer may carry forward to a particulartaxable year under this section equals the unused part of a creditallowed under this chapter.
(c) A taxpayer may:
(1) claim a tax credit under this chapter for a qualifiedinvestment; and
(2) carry forward a remainder for one (1) or more differentqualified investments;
in the same taxable year.
(d) The total amount of each tax credit claimed under this chaptermay not exceed ten percent (10%) of the qualified investment forwhich the tax credit is claimed.
As added by P.L.224-2003, SEC.197. Amended by P.L.199-2005,SEC.21.
IC 6-3.1-26-16
Shareholder or partner entitled to credit
Sec. 16. If a pass through entity does not have state tax liabilityagainst which the tax credit may be applied, a shareholder or partnerof the pass through entity is entitled to a tax credit equal to:
(1) the tax credit determined for the pass through entity for thetaxable year; multiplied by
(2) the percentage of the pass through entity's distributiveincome to which the shareholder or partner is entitled.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.107; P.L.199-2005, SEC.22.
IC 6-3.1-26-17
Application
Sec. 17. A person that proposes a project to create new jobs orincrease wage levels in Indiana may apply to the corporation beforethe taxpayer makes the qualified investment to enter into anagreement for a tax credit under this chapter. The director shallprescribe the form of the application.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,
SEC.106.
IC 6-3.1-26-18
Agreement for credit; conditions
Sec. 18. After receipt of an application, the corporation may enterinto an agreement with the applicant for a credit under this chapterif the corporation determines that all the following conditions exist:
(1) The applicant's project will raise the total earnings ofemployees of the applicant in Indiana.
(2) The applicant's project is economically sound and willbenefit the people of Indiana by increasing opportunities foremployment and strengthening the economy of Indiana.
(3) Receiving the tax credit is a major factor in the applicant'sdecision to go forward with the project and not receiving the taxcredit will result in the applicant not raising the total earningsof employees in Indiana.
(4) Awarding the tax credit will result in an overall positivefiscal impact to the state, as certified by the budget agencyusing the best available data.
(5) The credit is not prohibited by section 19 of this chapter.
(6) The average wage that will be paid by the taxpayer to itsemployees (excluding highly compensated employees) at thelocation after the credit is given will be at least equal to onehundred fifty percent (150%) of the hourly minimum wageunder IC 22-2-2-4 or its equivalent.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.107; P.L.199-2005, SEC.23; P.L.1-2006, SEC.143.
IC 6-3.1-26-19
Credit disallowed for relocated jobs
Sec. 19. A person is not entitled to claim the credit provided bythis chapter for any jobs that the person relocates from one (1) sitein Indiana to another site in Indiana. Determinations under thissection shall be made by the corporation.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.108.
IC 6-3.1-26-20
Amount
Sec. 20. The corporation shall certify the amount of the qualifiedinvestment that is eligible for a credit under this chapter. Indetermining the credit amount that should be awarded, thecorporation shall grant a credit only for the amount of the qualifiedinvestment that is directly related to expanding the workforce inIndiana.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.109.
IC 6-3.1-26-21
Agreement for credit; contents Sec. 21. The corporation shall enter into an agreement with anapplicant that is awarded a credit under this chapter. The agreementmust include all the following:
(1) A detailed description of the project that is the subject of theagreement.
(2) The first taxable year for which the credit may be claimed.
(3) The amount of the taxpayer's state tax liability for each taxin the taxable year of the taxpayer that immediately precededthe first taxable year in which the credit may be claimed.
(4) The maximum tax credit amount that will be allowed foreach taxable year.
(5) A requirement that the taxpayer shall maintain operations atthe project location for at least ten (10) years during the termthat the tax credit is available.
(6) A specific method for determining the number of newemployees employed during a taxable year who are performingjobs not previously performed by an employee.
(7) A requirement that the taxpayer shall annually report to thecorporation the number of new employees who are performingjobs not previously performed by an employee, the averagewage of the new employees, the average wage of all employeesat the location where the qualified investment is made, and anyother information the director needs to perform the director'sduties under this chapter.
(8) A requirement that the director is authorized to verify withthe appropriate state agencies the amounts reported undersubdivision (7), and that after doing so shall issue a certificateto the taxpayer stating that the amounts have been verified.
(9) A requirement that the taxpayer shall pay an average wageto all its employees other than highly compensated employeesin each taxable year that a tax credit is available that equals atleast one hundred fifty percent (150%) of the hourly minimumwage under IC 22-2-2-4 or its equivalent.
(10) A requirement that the taxpayer will keep the qualifiedinvestment property that is the basis for the tax credit in Indianafor at least the lesser of its useful life for federal income taxpurposes or ten (10) years.
(11) A requirement that the taxpayer will maintain at thelocation where the qualified investment is made during the termof the tax credit a total payroll that is at least equal to thepayroll level that existed before the qualified investment wasmade.
(12) A requirement that the taxpayer shall provide writtennotification to the director and the corporation not more thanthirty (30) days after the taxpayer makes or receives a proposalthat would transfer the taxpayer's state tax liability obligationsto a successor taxpayer.
(13) Any other performance conditions that the corporationdetermines are appropriate.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,
SEC.110.
IC 6-3.1-26-22
Certificate of verification
Sec. 22. A taxpayer claiming a credit under this chapter shallsubmit to the department of state revenue a copy of the director'scertificate of verification under this chapter for the taxable year.However, failure to submit a copy of the certificate does notinvalidate a claim for a credit.
As added by P.L.224-2003, SEC.197.
IC 6-3.1-26-23
Noncompliance; assessment
Sec. 23. If the director determines that a taxpayer who hasreceived a credit under this chapter is not complying with therequirements of the tax credit agreement or all the provisions of thischapter, the director shall, after giving the taxpayer an opportunityto explain the noncompliance, notify the Indiana economicdevelopment corporation and the department of state revenue of thenoncompliance and request an assessment. The department of staterevenue, with the assistance of the director, shall state the amount ofthe assessment, which may not exceed the sum of any previouslyallowed credits under this chapter. After receiving the notice, thedepartment of state revenue shall make an assessment against thetaxpayer under IC 6-8.1.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.111.
IC 6-3.1-26-24
Repealed
(Repealed by P.L.222-2007, SEC.2.)
IC 6-3.1-26-25
Biennial evaluation; report
Sec. 25. On a biennial basis, the corporation shall provide for anevaluation of the tax credit program. The evaluation must include anassessment of the effectiveness of the program in creating new jobsand increasing wages in Indiana and of the revenue impact of theprogram and may include a review of the practices and experiencesof other states with similar programs. The director shall submit areport on the evaluation to the governor, the president pro temporeof the senate, and the speaker of the house of representatives afterJune 30 and before November 1 in each odd-numbered year. Thereport provided to the president pro tempore of the senate and thespeaker of the house of representatives must be in an electronicformat under IC 5-14-6.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005,SEC.113.
IC 6-3.1-26-26 Expiration
Sec. 26. (a) This chapter applies to taxable years beginning afterDecember 31, 2003.
(b) Notwithstanding the other provisions of this chapter, thecorporation may not approve a credit for a qualified investment madeafter December 31, 2013. However, this section may not beconstrued to prevent a taxpayer from carrying an unused tax creditattributable to a qualified investment made before January 1, 2014,forward to a taxable year beginning after December 31, 2013, in themanner provided by section 15 of this chapter.
As added by P.L.224-2003, SEC.197. Amended by P.L.81-2004,SEC.16; P.L.137-2006, SEC.7; P.L.182-2009(ss), SEC.202.