CHAPTER 9. NEIGHBORHOOD ASSISTANCE CREDITS
IC 6-3.1-9
Chapter 9. Neighborhood Assistance Credits
IC 6-3.1-9-1
Definitions
Sec. 1. (a) As used in this chapter, "authority" means the Indianahousing and community development authority established byIC 5-20-1-3.
(b) As used in this chapter, "business firm" means any businessentity authorized to do business in the state of Indiana that has statetax liability.
(c) As used in this chapter, "community services" means any typeof:
(1) counseling and advice;
(2) emergency assistance;
(3) medical care;
(4) recreational facilities;
(5) housing facilities; or
(6) economic development assistance;
provided to individuals, economically disadvantaged households,groups, or neighborhood organizations in an economicallydisadvantaged area.
(d) As used in this chapter, "crime prevention" means any activitywhich aids in the reduction of crime in an economicallydisadvantaged area or an economically disadvantaged household.
(e) As used in this chapter, "economically disadvantaged area"means an enterprise zone, or any other federally or locally designatedeconomically disadvantaged area in Indiana. The certification shallbe made on the basis of current indices of social and economicconditions, which shall include but not be limited to the median percapita income of the area in relation to the median per capita incomeof the state or standard metropolitan statistical area in which the areais located.
(f) As used in this chapter, "economically disadvantagedhousehold" means a household with an annual income that is at orbelow eighty percent (80%) of the area median income or any otherfederally designated target population.
(g) As used in this chapter, "education" means any type ofscholastic instruction or scholarship assistance to an individual whoresides in an economically disadvantaged area that enables theindividual to prepare for better life opportunities.
(h) As used in this chapter, "enterprise zone" means an enterprisezone created under IC 5-28-15.
(i) As used in this chapter, "job training" means any type ofinstruction to an individual who resides in:
(1) an economically disadvantaged area; or
(2) an economically disadvantaged household;
that enables the individual to acquire vocational skills so that theindividual can become employable or be able to seek a higher gradeof employment. (j) As used in this chapter, "neighborhood assistance" meanseither:
(1) furnishing financial assistance, labor, material, and technicaladvice to aid in the physical or economic improvement of anypart or all of an economically disadvantaged area; or
(2) furnishing technical advice to promote higher employmentin any neighborhood in Indiana.
(k) As used in this chapter, "neighborhood organization" meansany organization, including but not limited to a nonprofitdevelopment corporation doing both of the following:
(1) Performing community services:
(A) in an economically disadvantaged area; or
(B) for an economically disadvantaged household.
(2) Holding a ruling:
(A) from the Internal Revenue Service of the United StatesDepartment of the Treasury that the organization is exemptfrom income taxation under the provisions of the InternalRevenue Code; and
(B) from the department of state revenue that theorganization is exempt from income taxation underIC 6-2.5-5-21.
(l) As used in this chapter, "person" means any individual subjectto Indiana gross or adjusted gross income tax.
(m) As used in this chapter, "state fiscal year" means a twelve(12) month period beginning on July 1 and ending on June 30.
(n) As used in this chapter, "state tax liability" means thetaxpayer's total tax liability that is incurred under:
(1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);and
(2) 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.
(o) As used in this chapter, "tax credit" means a deduction fromany tax otherwise due and payable under IC 6-3 or IC 6-5.5.
As added by P.L.51-1984, SEC.1. Amended by P.L.21-1990, SEC.12;P.L.25-1993, SEC.10; P.L.192-2002(ss), SEC.99; P.L.4-2005,SEC.53; P.L.235-2005, SEC.95; P.L.1-2006, SEC.140;P.L.181-2006, SEC.44; P.L.1-2007, SEC.54.
IC 6-3.1-9-2
Eligible persons; proposals; approval
Sec. 2. (a) A business firm or a person who contributes to aneighborhood organization that engages in the activities of providingneighborhood assistance, job training, or education for individualsnot employed by the business firm or person, or for communityservices or crime prevention in an economically disadvantaged areashall receive a tax credit as provided in section 3 of this chapter if theauthority approves the proposal of the business firm or person,setting forth the program to be conducted, the area selected, the
estimated amount to be invested in the program, and the plans forimplementing the program.
(b) The authority, after consultation with the community servicesagency and the commissioner of revenue, may adopt rules for theapproval or disapproval of these proposals.
As added by P.L.51-1984, SEC.1. Amended by P.L.4-2005, SEC.54;P.L.235-2005, SEC.96; P.L.1-2006, SEC.141; P.L.181-2006,SEC.45; P.L.1-2007, SEC.55.
IC 6-3.1-9-3
Amount of credit; application; pass through entities; shareholdersor partners of firms without tax liability
Sec. 3. (a) Subject to the limitations provided in subsection (b)and sections 4, 5, and 6 of this chapter, the department shall grant atax credit against any state tax liability due equal to fifty percent(50%) of the amount invested by a business firm or person in aprogram the proposal for which was approved under section 2 of thischapter.
(b) The credit provided by this chapter shall only be appliedagainst any state tax liability owed by the taxpayer after theapplication of any credits, which under IC 6-3.1-1-2 must be appliedbefore the credit provided by this chapter. In addition, the tax creditwhich a taxpayer receives under this chapter may not exceedtwenty-five thousand dollars ($25,000) for any taxable year of thetaxpayer.
(c) If a business firm that is:
(1) exempt from adjusted gross income tax (IC 6-3-1 throughIC 6-3-7) under IC 6-3-2-2.8(2); or
(2) a partnership;
does not have any tax liability against which the credit provided bythis section may be applied, a shareholder or a partner of the businessfirm is entitled to a credit against the shareholder's or the partner'sliability under the adjusted gross income tax.
(d) The amount of the credit provided by this section is equal to:
(1) the tax credit determined for the business firm for thetaxable year under subsection (a); multiplied by
(2) the percentage of the business firm's distributive income towhich the shareholder or the partner is entitled.
The credit provided by this section is in addition to any credit towhich a shareholder or partner is otherwise entitled under thischapter. However, a business firm and a shareholder or partner ofthat business firm may not claim a credit under this chapter for thesame investment.
As added by P.L.51-1984, SEC.1. Amended by P.L.25-1993, SEC.11;P.L.1-1994, SEC.29; P.L.192-2002(ss), SEC.100.
IC 6-3.1-9-4
Application for credit; form; contents; priority; notification ofcredit allowable; filing of statement; disallowance
Sec. 4. (a) Any business firm or person which desires to claim a
tax credit as provided in this chapter shall file with the department,in the form that the department may prescribe, an application statingthe amount of the contribution or investment which it proposes tomake which would qualify for a tax credit, and the amount sought tobe claimed as a credit. The application shall include a certificateevidencing approval of the contribution or program by the authority.
(b) The authority shall give priority in issuing certificates toapplicants whose contributions or programs directly benefitenterprise zones.
(c) The department shall promptly notify an applicant whether, orthe extent to which, the tax credit is allowable in the state fiscal yearin which the application is filed, as provided in section 5 of thischapter. If the credit is allowable in that state fiscal year, theapplicant shall within thirty (30) days after receipt of the notice filewith the department of state revenue a statement, in the form andaccompanied by the proof of payment as the department mayprescribe, setting forth that the amount to be claimed as a creditunder this chapter has been paid to an organization for an approvedprogram or purpose, or permanently set aside in a special account tobe used solely for an approved program or purpose.
(d) The department may disallow any credit claimed under thischapter for which the statement or proof of payment is not filedwithin the thirty (30) day period.
As added by P.L.51-1984, SEC.1. Amended by P.L.4-2005, SEC.55;P.L.235-2005, SEC.97; P.L.1-2006, SEC.142; P.L.181-2006,SEC.46; P.L.1-2007, SEC.56.
IC 6-3.1-9-5
Limitation on tax credits; approval of applications; failure to filestatement of proof of payment
Sec. 5. (a) The amount of tax credits allowed under this chaptermay not exceed two million five hundred thousand dollars($2,500,000) in the state fiscal year beginning July 1, 1997, andending June 30, 1998, and each state fiscal year thereafter.
(b) The department shall record the time of filing of eachapplication for allowance of a credit required under section 4 of thischapter and shall approve the applications, if they otherwise qualifyfor a tax credit under this chapter, in the chronological order inwhich the applications are filed in the state fiscal year.
(c) When the total credits approved under this section equal themaximum amount allowable in any state fiscal year, no applicationthereafter filed for that same fiscal year shall be approved. However,if any applicant for whom a credit has been approved fails to file thestatement of proof of payment required under section 4 of thischapter, an amount equal to the credit previously allowed or set asidefor the applicant may be allowed to any subsequent applicant in theyear. In addition, the department may, if the applicant so requests,approve a credit application, in whole or in part, with respect to thenext succeeding state fiscal year.
As added by P.L.51-1984, SEC.1. Amended by P.L.95-1995, SEC.1;
P.L.64-1997, SEC.1.
IC 6-3.1-9-6
Allowable years of credit
Sec. 6. A tax credit shall be allowable under this chapter only forthe taxable year of the taxpayer in which the contribution qualifyingfor the credit is paid or permanently set aside in a special account forthe approved program or purpose.
As added by P.L.51-1984, SEC.1.