IC 6-3.1-4-1 Definitions
Sec. 1. As used in this chapter:
"Base amount" means base amount (as defined in Section 41(c)
of the Internal Revenue Code as in effect on January 1, 2001),
modified by considering only Indiana qualified research expenses
and gross receipts attributable to Indiana in the calculation of the
taxpayer's:
(1) fixed base percentage; and
(2) average annual gross receipts.
"Indiana qualified research expense" means qualified research
expense that is incurred for research conducted in Indiana.
"Qualified research expense" means qualified research expense
(as defined in Section 41(b) of the Internal Revenue Code as in effect
on January 1, 2001).
"Pass through entity" means:
(1) a corporation that is exempt from the adjusted gross income
tax under IC 6-3-2-2.8(2);
(2) a partnership;
(3) a limited liability company; or
(4) a limited liability partnership.
"Research expense tax credit" means a credit provided under this
chapter against any tax otherwise due and payable under IC 6-3.
"Taxpayer" means an individual, a corporation, a limited liability
company, a limited liability partnership, a trust, or a partnership that
has any tax liability under IC 6-3 (adjusted gross income tax). As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.1;
P.L.8-1993, SEC.85; P.L.8-1996, SEC.7; P.L.192-2002(ss), SEC.86;
P.L.193-2005, SEC.12.
IC 6-3.1-4-2 Amount of credit; computation
Sec. 2. (a) A taxpayer who incurs Indiana qualified research
expense in a particular taxable year is entitled to a research expense
tax credit for the taxable year.
(b) For Indiana qualified research expense incurred before
January 1, 2008, the amount of the research expense tax credit is
equal to the product of ten percent (10%) multiplied by the
remainder of:
(1) the taxpayer's Indiana qualified research expenses for the
taxable year; minus
(2) the taxpayer's base amount.
(c) Except as provided in subsection (d), for Indiana qualified
research expense incurred after December 31, 2007, the amount of
the research expense tax credit is determined under STEP FOUR of
the following formula:
STEP ONE: Subtract the taxpayer's base amount from the
taxpayer's Indiana qualified research expense for the taxable
year.
STEP TWO: Multiply the lesser of:
(A) one million dollars ($1,000,000); or
(B) the STEP ONE remainder;
by fifteen percent (15%).
STEP THREE: If the STEP ONE remainder exceeds one
million dollars ($1,000,000), multiply the amount of that excess
by ten percent (10%).
STEP FOUR: Add the STEP TWO and STEP THREE products.
(d) For Indiana qualified research expense incurred after
December 31, 2009, a taxpayer may choose to have the amount of the
research expense tax credit determined under this subsection rather
than under subsection (c). At the election of the taxpayer, the amount
of the taxpayer's research expense tax credit is equal to ten percent
(10%) of the part of the taxpayer's Indiana qualified research expense
for the taxable year that exceeds fifty percent (50%) of the taxpayer's
average Indiana qualified research expense for the three (3) taxable
years preceding the taxable year for which the credit is being
determined. However, if the taxpayer did not have Indiana qualified
research expense in any one (1) of the three (3) taxable years
preceding the taxable year for which the credit is being determined,
the amount of the research expense tax credit is equal to five percent
(5%) of the taxpayer's Indiana qualified research expense for the
taxable year. As added by P.L.51-1984, SEC.1. Amended by P.L.53-1984, SEC.1;
P.L.57-1990, SEC.2; P.L.192-2002(ss), SEC.87; P.L.193-2005,
SEC.13; P.L.182-2009(ss), SEC.201.
IC 6-3.1-4-2.5 Amount of credit; alternative computation
Sec 2.5. (a) The general assembly makes the following findings
pertaining to this section:
(1) The aerospace industry is adversely affected by the
calculation of qualified research expense credits under this
chapter, based on the Internal Revenue Code's treatment of
federal defense spending trends in the 1980s.
(2) This adverse impact creates a disincentive for making
qualified research expenditures in Indiana.
(3) Manufacturers of aerospace and jet propulsion equipment
have been a major in-state employer of science and engineering
graduates from Indiana universities.
(4) The presence of a strong aerospace manufacturing base
furthers the state's interest in maintaining the viability of a
United States government military installation that is used for
the design, construction, maintenance, and testing of electronic
devices and ordnance.
(5) The creation of an alternative qualified research expense
credit promotes vital state interests.
(b) This section applies only to a taxpayer that:
(1) is primarily engaged in the production of civil and military
jet propulsion systems;
(2) is certified by the Indiana economic development
corporation as an aerospace advanced manufacturer;
(3) is a United States Department of Defense contractor; and
(4) maintains one (1) or more manufacturing facilities in
Indiana employing at least three thousand (3,000) employees in
full-time employment positions that pay on average more than
four hundred percent (400%) of the hourly minimum wage
under IC 22-2-2-4 or its equivalent.
(c) A taxpayer that incurs Indiana qualified research expense in
a particular taxable year may elect to calculate the research expense
tax credit under this section instead of under section 2 of this
chapter.
(d) An election under this section applies to the taxable year for
which the election is made and all succeeding taxable years unless
the election is revoked with the consent of the department. An
election must be made in the manner and on the form prescribed by
the department.
(e) A credit may be authorized by the Indiana economic
development corporation and, if authorized, shall be equal to a
percentage determined by the Indiana economic development
corporation, not to exceed ten percent (10%), multiplied by:
(1) the taxpayer's Indiana qualified research expenses for the
taxable year; minus
(2) fifty percent (50%) of the taxpayer's average Indiana
qualified research expenses for the three (3) taxable years
preceding the taxable year for which the credit is being
determined.
(f) The credit amount determined in subsection (e) applies to the
taxable year for which the determination is made and all succeeding
taxable years unless the determination is changed by the Indiana
economic development corporation. The duration of a determination
made by the Indiana economic development corporation under
subsection (e) shall be specified by the Indiana economic
development corporation at the time of the determination. As added by P.L.197-2005, SEC.1.
IC 6-3.1-4-3 Unused credits carried forward
Sec. 3. (a) The amount of the credit provided by this chapter that
a taxpayer uses during a particular taxable year may not exceed the
sum of the taxes imposed by IC 6-3 for the taxable year after the
application of all credits that under IC 6-3.1-1-2 are to be applied
before the credit provided by this chapter. If the credit provided by
this chapter exceeds that sum for the taxable year for which the credit
is first claimed, then the excess may be carried over to succeeding
taxable years and used as a credit against the tax otherwise due and
payable by the taxpayer under IC 6-3 during those taxable years.
Each time that the credit is carried over to a succeeding taxable year,
it is to be reduced by the amount which was used as a credit during
the immediately preceding taxable year. The credit provided by this
chapter may be carried forward and applied to succeeding taxable
years for ten (10) taxable years following the unused credit year.
(b) A credit earned by a taxpayer in a particular taxable year shall
be applied against the taxpayer's tax liability for that taxable year
before any credit carryover is applied against that liability under
subsection (a).
(c) A taxpayer is not entitled to any carryback or refund of any
unused credit. As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.3;
P.L.192-2002(ss), SEC.88; P.L.193-2005, SEC.14.
IC 6-3.1-4-4 Application of Internal Revenue Code provisions
Sec. 4. The provisions of Section 41 of the Internal Revenue Code
as in effect on January 1, 2001, and the regulations promulgated in
respect to those provisions and in effect on January 1, 2001, are
applicable to the interpretation and administration by the department
of the credit provided by this chapter, including the allocation and
pass through of the credit to various taxpayers and the transitional
rules for determination of the base period. As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.4;
P.L.192-2002(ss), SEC.89.
IC 6-3.1-4-5 Qualified research expenses; determination
Sec. 5. In prescribing standards for determining which qualified
research expenses are considered Indiana qualified research expenses
for purposes of computing the credit provided by this chapter, the
department may consider:
(1) the place where the services are performed;
(2) the residence or business location of the person or persons
performing the services;
(3) the place where qualified research supplies are consumed;
and
(4) other factors that the department determines are relevant for
the determination. As added by P.L.51-1984, SEC.1.
IC 6-3.1-4-6 Federal credit expiration date inapplicable
Sec. 6. Notwithstanding Section 41 of the Internal Revenue Code,
the termination date in Section 41(h) of the Internal Revenue Code
does not apply to a taxpayer who is eligible for the credit under this
chapter for the taxable year in which the Indiana qualified research
expense is incurred. As added by P.L.51-1984, SEC.1. Amended by P.L.53-1984, SEC.2;
P.L.57-1990, SEC.5; P.L.43-1992, SEC.10; P.L.76-1993, SEC.1;
P.L.19-1994, SEC.9; P.L.8-1996, SEC.8; P.L.4-2000, SEC.13;
IC 6-3.1-4-7 Pass through entity; shareholder, partner, or member
Sec. 7. (a) If a pass through entity does not have state income tax
liability against which the research expense tax credit may be
applied, a shareholder, partner, or member of the pass through entity
is entitled to a research expense tax credit equal to:
(1) the research expense tax credit determined for the pass
through entity for the taxable year; multiplied by
(2) the percentage of the pass through entity's distributive
income to which the shareholder, partner, or member is entitled.
(b) The credit provided under subsection (a) is in addition to a
research expense tax credit to which a shareholder, partner, or
member of a pass through entity is otherwise entitled under this
chapter. However, a pass through entity and a shareholder, partner,
or member of the pass through entity may not claim a credit under
this chapter for the same qualified research expenses. As added by P.L.57-1990, SEC.6. Amended by P.L.193-2005,
SEC.15.
IC 6-3.1-4-1 Definitions
Sec. 1. As used in this chapter:
"Base amount" means base amount (as defined in Section 41(c)
of the Internal Revenue Code as in effect on January 1, 2001),
modified by considering only Indiana qualified research expenses
and gross receipts attributable to Indiana in the calculation of the
taxpayer's:
(1) fixed base percentage; and
(2) average annual gross receipts.
"Indiana qualified research expense" means qualified research
expense that is incurred for research conducted in Indiana.
"Qualified research expense" means qualified research expense
(as defined in Section 41(b) of the Internal Revenue Code as in effect
on January 1, 2001).
"Pass through entity" means:
(1) a corporation that is exempt from the adjusted gross income
tax under IC 6-3-2-2.8(2);
(2) a partnership;
(3) a limited liability company; or
(4) a limited liability partnership.
"Research expense tax credit" means a credit provided under this
chapter against any tax otherwise due and payable under IC 6-3.
"Taxpayer" means an individual, a corporation, a limited liability
company, a limited liability partnership, a trust, or a partnership that
has any tax liability under IC 6-3 (adjusted gross income tax). As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.1;
P.L.8-1993, SEC.85; P.L.8-1996, SEC.7; P.L.192-2002(ss), SEC.86;
P.L.193-2005, SEC.12.
IC 6-3.1-4-2 Amount of credit; computation
Sec. 2. (a) A taxpayer who incurs Indiana qualified research
expense in a particular taxable year is entitled to a research expense
tax credit for the taxable year.
(b) For Indiana qualified research expense incurred before
January 1, 2008, the amount of the research expense tax credit is
equal to the product of ten percent (10%) multiplied by the
remainder of:
(1) the taxpayer's Indiana qualified research expenses for the
taxable year; minus
(2) the taxpayer's base amount.
(c) Except as provided in subsection (d), for Indiana qualified
research expense incurred after December 31, 2007, the amount of
the research expense tax credit is determined under STEP FOUR of
the following formula:
STEP ONE: Subtract the taxpayer's base amount from the
taxpayer's Indiana qualified research expense for the taxable
year.
STEP TWO: Multiply the lesser of:
(A) one million dollars ($1,000,000); or
(B) the STEP ONE remainder;
by fifteen percent (15%).
STEP THREE: If the STEP ONE remainder exceeds one
million dollars ($1,000,000), multiply the amount of that excess
by ten percent (10%).
STEP FOUR: Add the STEP TWO and STEP THREE products.
(d) For Indiana qualified research expense incurred after
December 31, 2009, a taxpayer may choose to have the amount of the
research expense tax credit determined under this subsection rather
than under subsection (c). At the election of the taxpayer, the amount
of the taxpayer's research expense tax credit is equal to ten percent
(10%) of the part of the taxpayer's Indiana qualified research expense
for the taxable year that exceeds fifty percent (50%) of the taxpayer's
average Indiana qualified research expense for the three (3) taxable
years preceding the taxable year for which the credit is being
determined. However, if the taxpayer did not have Indiana qualified
research expense in any one (1) of the three (3) taxable years
preceding the taxable year for which the credit is being determined,
the amount of the research expense tax credit is equal to five percent
(5%) of the taxpayer's Indiana qualified research expense for the
taxable year. As added by P.L.51-1984, SEC.1. Amended by P.L.53-1984, SEC.1;
P.L.57-1990, SEC.2; P.L.192-2002(ss), SEC.87; P.L.193-2005,
SEC.13; P.L.182-2009(ss), SEC.201.
IC 6-3.1-4-2.5 Amount of credit; alternative computation
Sec 2.5. (a) The general assembly makes the following findings
pertaining to this section:
(1) The aerospace industry is adversely affected by the
calculation of qualified research expense credits under this
chapter, based on the Internal Revenue Code's treatment of
federal defense spending trends in the 1980s.
(2) This adverse impact creates a disincentive for making
qualified research expenditures in Indiana.
(3) Manufacturers of aerospace and jet propulsion equipment
have been a major in-state employer of science and engineering
graduates from Indiana universities.
(4) The presence of a strong aerospace manufacturing base
furthers the state's interest in maintaining the viability of a
United States government military installation that is used for
the design, construction, maintenance, and testing of electronic
devices and ordnance.
(5) The creation of an alternative qualified research expense
credit promotes vital state interests.
(b) This section applies only to a taxpayer that:
(1) is primarily engaged in the production of civil and military
jet propulsion systems;
(2) is certified by the Indiana economic development
corporation as an aerospace advanced manufacturer;
(3) is a United States Department of Defense contractor; and
(4) maintains one (1) or more manufacturing facilities in
Indiana employing at least three thousand (3,000) employees in
full-time employment positions that pay on average more than
four hundred percent (400%) of the hourly minimum wage
under IC 22-2-2-4 or its equivalent.
(c) A taxpayer that incurs Indiana qualified research expense in
a particular taxable year may elect to calculate the research expense
tax credit under this section instead of under section 2 of this
chapter.
(d) An election under this section applies to the taxable year for
which the election is made and all succeeding taxable years unless
the election is revoked with the consent of the department. An
election must be made in the manner and on the form prescribed by
the department.
(e) A credit may be authorized by the Indiana economic
development corporation and, if authorized, shall be equal to a
percentage determined by the Indiana economic development
corporation, not to exceed ten percent (10%), multiplied by:
(1) the taxpayer's Indiana qualified research expenses for the
taxable year; minus
(2) fifty percent (50%) of the taxpayer's average Indiana
qualified research expenses for the three (3) taxable years
preceding the taxable year for which the credit is being
determined.
(f) The credit amount determined in subsection (e) applies to the
taxable year for which the determination is made and all succeeding
taxable years unless the determination is changed by the Indiana
economic development corporation. The duration of a determination
made by the Indiana economic development corporation under
subsection (e) shall be specified by the Indiana economic
development corporation at the time of the determination. As added by P.L.197-2005, SEC.1.
IC 6-3.1-4-3 Unused credits carried forward
Sec. 3. (a) The amount of the credit provided by this chapter that
a taxpayer uses during a particular taxable year may not exceed the
sum of the taxes imposed by IC 6-3 for the taxable year after the
application of all credits that under IC 6-3.1-1-2 are to be applied
before the credit provided by this chapter. If the credit provided by
this chapter exceeds that sum for the taxable year for which the credit
is first claimed, then the excess may be carried over to succeeding
taxable years and used as a credit against the tax otherwise due and
payable by the taxpayer under IC 6-3 during those taxable years.
Each time that the credit is carried over to a succeeding taxable year,
it is to be reduced by the amount which was used as a credit during
the immediately preceding taxable year. The credit provided by this
chapter may be carried forward and applied to succeeding taxable
years for ten (10) taxable years following the unused credit year.
(b) A credit earned by a taxpayer in a particular taxable year shall
be applied against the taxpayer's tax liability for that taxable year
before any credit carryover is applied against that liability under
subsection (a).
(c) A taxpayer is not entitled to any carryback or refund of any
unused credit. As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.3;
P.L.192-2002(ss), SEC.88; P.L.193-2005, SEC.14.
IC 6-3.1-4-4 Application of Internal Revenue Code provisions
Sec. 4. The provisions of Section 41 of the Internal Revenue Code
as in effect on January 1, 2001, and the regulations promulgated in
respect to those provisions and in effect on January 1, 2001, are
applicable to the interpretation and administration by the department
of the credit provided by this chapter, including the allocation and
pass through of the credit to various taxpayers and the transitional
rules for determination of the base period. As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.4;
P.L.192-2002(ss), SEC.89.
IC 6-3.1-4-5 Qualified research expenses; determination
Sec. 5. In prescribing standards for determining which qualified
research expenses are considered Indiana qualified research expenses
for purposes of computing the credit provided by this chapter, the
department may consider:
(1) the place where the services are performed;
(2) the residence or business location of the person or persons
performing the services;
(3) the place where qualified research supplies are consumed;
and
(4) other factors that the department determines are relevant for
the determination. As added by P.L.51-1984, SEC.1.
IC 6-3.1-4-6 Federal credit expiration date inapplicable
Sec. 6. Notwithstanding Section 41 of the Internal Revenue Code,
the termination date in Section 41(h) of the Internal Revenue Code
does not apply to a taxpayer who is eligible for the credit under this
chapter for the taxable year in which the Indiana qualified research
expense is incurred. As added by P.L.51-1984, SEC.1. Amended by P.L.53-1984, SEC.2;
P.L.57-1990, SEC.5; P.L.43-1992, SEC.10; P.L.76-1993, SEC.1;
P.L.19-1994, SEC.9; P.L.8-1996, SEC.8; P.L.4-2000, SEC.13;
IC 6-3.1-4-7 Pass through entity; shareholder, partner, or member
Sec. 7. (a) If a pass through entity does not have state income tax
liability against which the research expense tax credit may be
applied, a shareholder, partner, or member of the pass through entity
is entitled to a research expense tax credit equal to:
(1) the research expense tax credit determined for the pass
through entity for the taxable year; multiplied by
(2) the percentage of the pass through entity's distributive
income to which the shareholder, partner, or member is entitled.
(b) The credit provided under subsection (a) is in addition to a
research expense tax credit to which a shareholder, partner, or
member of a pass through entity is otherwise entitled under this
chapter. However, a pass through entity and a shareholder, partner,
or member of the pass through entity may not claim a credit under
this chapter for the same qualified research expenses. As added by P.L.57-1990, SEC.6. Amended by P.L.193-2005,
SEC.15.
IC 6-3.1-4-1 Definitions
Sec. 1. As used in this chapter:
"Base amount" means base amount (as defined in Section 41(c)
of the Internal Revenue Code as in effect on January 1, 2001),
modified by considering only Indiana qualified research expenses
and gross receipts attributable to Indiana in the calculation of the
taxpayer's:
(1) fixed base percentage; and
(2) average annual gross receipts.
"Indiana qualified research expense" means qualified research
expense that is incurred for research conducted in Indiana.
"Qualified research expense" means qualified research expense
(as defined in Section 41(b) of the Internal Revenue Code as in effect
on January 1, 2001).
"Pass through entity" means:
(1) a corporation that is exempt from the adjusted gross income
tax under IC 6-3-2-2.8(2);
(2) a partnership;
(3) a limited liability company; or
(4) a limited liability partnership.
"Research expense tax credit" means a credit provided under this
chapter against any tax otherwise due and payable under IC 6-3.
"Taxpayer" means an individual, a corporation, a limited liability
company, a limited liability partnership, a trust, or a partnership that
has any tax liability under IC 6-3 (adjusted gross income tax). As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.1;
P.L.8-1993, SEC.85; P.L.8-1996, SEC.7; P.L.192-2002(ss), SEC.86;
P.L.193-2005, SEC.12.
IC 6-3.1-4-2 Amount of credit; computation
Sec. 2. (a) A taxpayer who incurs Indiana qualified research
expense in a particular taxable year is entitled to a research expense
tax credit for the taxable year.
(b) For Indiana qualified research expense incurred before
January 1, 2008, the amount of the research expense tax credit is
equal to the product of ten percent (10%) multiplied by the
remainder of:
(1) the taxpayer's Indiana qualified research expenses for the
taxable year; minus
(2) the taxpayer's base amount.
(c) Except as provided in subsection (d), for Indiana qualified
research expense incurred after December 31, 2007, the amount of
the research expense tax credit is determined under STEP FOUR of
the following formula:
STEP ONE: Subtract the taxpayer's base amount from the
taxpayer's Indiana qualified research expense for the taxable
year.
STEP TWO: Multiply the lesser of:
(A) one million dollars ($1,000,000); or
(B) the STEP ONE remainder;
by fifteen percent (15%).
STEP THREE: If the STEP ONE remainder exceeds one
million dollars ($1,000,000), multiply the amount of that excess
by ten percent (10%).
STEP FOUR: Add the STEP TWO and STEP THREE products.
(d) For Indiana qualified research expense incurred after
December 31, 2009, a taxpayer may choose to have the amount of the
research expense tax credit determined under this subsection rather
than under subsection (c). At the election of the taxpayer, the amount
of the taxpayer's research expense tax credit is equal to ten percent
(10%) of the part of the taxpayer's Indiana qualified research expense
for the taxable year that exceeds fifty percent (50%) of the taxpayer's
average Indiana qualified research expense for the three (3) taxable
years preceding the taxable year for which the credit is being
determined. However, if the taxpayer did not have Indiana qualified
research expense in any one (1) of the three (3) taxable years
preceding the taxable year for which the credit is being determined,
the amount of the research expense tax credit is equal to five percent
(5%) of the taxpayer's Indiana qualified research expense for the
taxable year. As added by P.L.51-1984, SEC.1. Amended by P.L.53-1984, SEC.1;
P.L.57-1990, SEC.2; P.L.192-2002(ss), SEC.87; P.L.193-2005,
SEC.13; P.L.182-2009(ss), SEC.201.
IC 6-3.1-4-2.5 Amount of credit; alternative computation
Sec 2.5. (a) The general assembly makes the following findings
pertaining to this section:
(1) The aerospace industry is adversely affected by the
calculation of qualified research expense credits under this
chapter, based on the Internal Revenue Code's treatment of
federal defense spending trends in the 1980s.
(2) This adverse impact creates a disincentive for making
qualified research expenditures in Indiana.
(3) Manufacturers of aerospace and jet propulsion equipment
have been a major in-state employer of science and engineering
graduates from Indiana universities.
(4) The presence of a strong aerospace manufacturing base
furthers the state's interest in maintaining the viability of a
United States government military installation that is used for
the design, construction, maintenance, and testing of electronic
devices and ordnance.
(5) The creation of an alternative qualified research expense
credit promotes vital state interests.
(b) This section applies only to a taxpayer that:
(1) is primarily engaged in the production of civil and military
jet propulsion systems;
(2) is certified by the Indiana economic development
corporation as an aerospace advanced manufacturer;
(3) is a United States Department of Defense contractor; and
(4) maintains one (1) or more manufacturing facilities in
Indiana employing at least three thousand (3,000) employees in
full-time employment positions that pay on average more than
four hundred percent (400%) of the hourly minimum wage
under IC 22-2-2-4 or its equivalent.
(c) A taxpayer that incurs Indiana qualified research expense in
a particular taxable year may elect to calculate the research expense
tax credit under this section instead of under section 2 of this
chapter.
(d) An election under this section applies to the taxable year for
which the election is made and all succeeding taxable years unless
the election is revoked with the consent of the department. An
election must be made in the manner and on the form prescribed by
the department.
(e) A credit may be authorized by the Indiana economic
development corporation and, if authorized, shall be equal to a
percentage determined by the Indiana economic development
corporation, not to exceed ten percent (10%), multiplied by:
(1) the taxpayer's Indiana qualified research expenses for the
taxable year; minus
(2) fifty percent (50%) of the taxpayer's average Indiana
qualified research expenses for the three (3) taxable years
preceding the taxable year for which the credit is being
determined.
(f) The credit amount determined in subsection (e) applies to the
taxable year for which the determination is made and all succeeding
taxable years unless the determination is changed by the Indiana
economic development corporation. The duration of a determination
made by the Indiana economic development corporation under
subsection (e) shall be specified by the Indiana economic
development corporation at the time of the determination. As added by P.L.197-2005, SEC.1.
IC 6-3.1-4-3 Unused credits carried forward
Sec. 3. (a) The amount of the credit provided by this chapter that
a taxpayer uses during a particular taxable year may not exceed the
sum of the taxes imposed by IC 6-3 for the taxable year after the
application of all credits that under IC 6-3.1-1-2 are to be applied
before the credit provided by this chapter. If the credit provided by
this chapter exceeds that sum for the taxable year for which the credit
is first claimed, then the excess may be carried over to succeeding
taxable years and used as a credit against the tax otherwise due and
payable by the taxpayer under IC 6-3 during those taxable years.
Each time that the credit is carried over to a succeeding taxable year,
it is to be reduced by the amount which was used as a credit during
the immediately preceding taxable year. The credit provided by this
chapter may be carried forward and applied to succeeding taxable
years for ten (10) taxable years following the unused credit year.
(b) A credit earned by a taxpayer in a particular taxable year shall
be applied against the taxpayer's tax liability for that taxable year
before any credit carryover is applied against that liability under
subsection (a).
(c) A taxpayer is not entitled to any carryback or refund of any
unused credit. As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.3;
P.L.192-2002(ss), SEC.88; P.L.193-2005, SEC.14.
IC 6-3.1-4-4 Application of Internal Revenue Code provisions
Sec. 4. The provisions of Section 41 of the Internal Revenue Code
as in effect on January 1, 2001, and the regulations promulgated in
respect to those provisions and in effect on January 1, 2001, are
applicable to the interpretation and administration by the department
of the credit provided by this chapter, including the allocation and
pass through of the credit to various taxpayers and the transitional
rules for determination of the base period. As added by P.L.51-1984, SEC.1. Amended by P.L.57-1990, SEC.4;
P.L.192-2002(ss), SEC.89.
IC 6-3.1-4-5 Qualified research expenses; determination
Sec. 5. In prescribing standards for determining which qualified
research expenses are considered Indiana qualified research expenses
for purposes of computing the credit provided by this chapter, the
department may consider:
(1) the place where the services are performed;
(2) the residence or business location of the person or persons
performing the services;
(3) the place where qualified research supplies are consumed;
and
(4) other factors that the department determines are relevant for
the determination. As added by P.L.51-1984, SEC.1.
IC 6-3.1-4-6 Federal credit expiration date inapplicable
Sec. 6. Notwithstanding Section 41 of the Internal Revenue Code,
the termination date in Section 41(h) of the Internal Revenue Code
does not apply to a taxpayer who is eligible for the credit under this
chapter for the taxable year in which the Indiana qualified research
expense is incurred. As added by P.L.51-1984, SEC.1. Amended by P.L.53-1984, SEC.2;
P.L.57-1990, SEC.5; P.L.43-1992, SEC.10; P.L.76-1993, SEC.1;
P.L.19-1994, SEC.9; P.L.8-1996, SEC.8; P.L.4-2000, SEC.13;
IC 6-3.1-4-7 Pass through entity; shareholder, partner, or member
Sec. 7. (a) If a pass through entity does not have state income tax
liability against which the research expense tax credit may be
applied, a shareholder, partner, or member of the pass through entity
is entitled to a research expense tax credit equal to:
(1) the research expense tax credit determined for the pass
through entity for the taxable year; multiplied by
(2) the percentage of the pass through entity's distributive
income to which the shareholder, partner, or member is entitled.
(b) The credit provided under subsection (a) is in addition to a
research expense tax credit to which a shareholder, partner, or
member of a pass through entity is otherwise entitled under this
chapter. However, a pass through entity and a shareholder, partner,
or member of the pass through entity may not claim a credit under
this chapter for the same qualified research expenses. As added by P.L.57-1990, SEC.6. Amended by P.L.193-2005,
SEC.15.