Sec. 16. (a) If a pass through entity does not have state tax liability against which the tax credit may be applied, a shareholder, member, or partner of the pass through entity is entitled to a tax credit equal to:
(1) the 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, member, or partner is entitled.
(b) Subject to subsection (d) and (g), a shareholder, member, or partner of a pass through entity that is entitled to a tax credit under this section may carry forward an unused credit for the number of years determined by the corporation, not to exceed nine (9) consecutive taxable years, beginning with the taxable year after the taxable year in which the pass through entity makes the qualified investment.
(c) The amount that a shareholder, member, or partner may carry forward to a particular taxable year under this section equals the unused part of a tax credit allowed under this chapter to which the shareholder, member, or partner is entitled.
(d) This subsection applies only to a pass through entity that:
(1) proposes at least five hundred million dollars ($500,000,000) in total investment over a five (5) year period; and
(2) enters into a written agreement with the corporation under this subsection before January 1, 2017, and the shareholders, members, or partners of the pass through entity agree to claim tax credits under this chapter for not more than one hundred seventy million dollars ($170,000,000) of qualified investment that is made as part of the investment proposed as described in subdivision (1).
Notwithstanding subsection (b), the corporation may accelerate to the current taxable year the excess tax credit amount that could otherwise be carried forward by all shareholders, members, or partners of a pass through entity under subsection (b). The excess amount of the tax credit accelerated under this subsection shall be discounted as determined under a written agreement entered into by the pass through entity and the corporation. Subject to subsection (f), the total amount of qualified investments for which tax credits may be accelerated under this subsection may not exceed one hundred seventy million dollars ($170,000,000). The discounted amount of the excess tax credit accelerated under this subsection as determined by the corporation may be remitted to the shareholders, members, or partners of the pass through entity as provided in the written agreement between the corporation and the pass through entity. The requirement for an agreement under section 21(11) of this chapter does not apply to this subsection. This subsection expires December 31, 2025.
(e) A written agreement under subsection (d) may contain a provision for payment of liquidated damages:
(1) to the corporation for failure to comply with the conditions set forth in this chapter and the agreement entered into by the corporation and pass through entity under this chapter;
(2) that are personally guaranteed by the shareholders, members, or partners of the pass through entity; and
(3) that are in addition to an assessment made by the department for noncompliance under section 23 of this chapter.
This subsection expires December 31, 2025.
(f) The total aggregated amount of tax credits that the corporation may discount under subsection (d) and section 15(d) of this chapter in a state fiscal year may not exceed seventeen million dollars ($17,000,000), as determined before the discount is applied. This subsection expires December 31, 2025.
(g) This subsection applies only to a pass through entity that:
(1) proposes at least two hundred fifty million dollars ($250,000,000) in total investment over a five (5) year period; and
(2) enters into a written agreement with the corporation under this subsection before July 1, 2022, and the shareholders, members, or partners of the pass through entity agree to claim tax credits under this chapter for not more than one hundred seventy million dollars ($170,000,000) of qualified investment that is made as part of the investment proposed as described in subdivision (1).
Notwithstanding subsection (b), the corporation may accelerate to the current taxable year the excess tax credit amount that could otherwise be carried forward by all shareholders, members, or partners of a pass through entity under subsection (b). The excess amount of the tax credit accelerated under this subsection shall be discounted as determined under a written agreement entered into by the pass through entity and the corporation. Subject to subsection (i), the total amount of qualified investments for which tax credits may be accelerated under this subsection may not exceed one hundred seventy million dollars ($170,000,000). The discounted amount of the excess tax credit accelerated under this subsection as determined by the corporation may be remitted to the shareholders, members, or partners of the pass through entity as provided in the written agreement between the corporation and the pass through entity. The requirement for an agreement under section 21(11) of this chapter does not apply to this subsection. This subsection expires December 31, 2031.
(h) A written agreement under subsection (g) may contain a provision for payment of liquidated damages:
(1) to the corporation for failure to comply with the conditions set forth in this chapter and the agreement entered into by the corporation and pass through entity under this chapter;
(2) that are personally guaranteed by the shareholders, members, or partners of the pass through entity; and
(3) that are in addition to an assessment made by the department for noncompliance under section 23 of this chapter.
This subsection expires December 31, 2031.
(i) The total aggregated amount of tax credits that the corporation may discount under subsection (g) and section 15(g) of this chapter in a state fiscal year may not exceed seventeen million dollars ($17,000,000), as determined before the discount is applied. This subsection expires December 31, 2031.
As added by P.L.224-2003, SEC.197. Amended by P.L.4-2005, SEC.107; P.L.199-2005, SEC.22; P.L.250-2015, SEC.33; P.L.122-2016, SEC.7; P.L.165-2021, SEC.89.
Structure Indiana Code
Article 3.1. State Tax Liability Credits
Chapter 26. Hoosier Business Investment Tax Credit
6-3.1-26-3.1. "Digital Manufacturing Equipment"
6-3.1-26-5. "Highly Compensated Employee"
6-3.1-26-5.5. "Motion Picture or Audio Production"
6-3.1-26-7. "Pass Through Entity"
6-3.1-26-8. "Qualified Investment"
6-3.1-26-8.5. "Logistics Investment"
6-3.1-26-9. "State Tax Liability"
6-3.1-26-12. Purpose of Credit
6-3.1-26-13. Entitlement to Credit
6-3.1-26-15. Carry Forward of Credit; Acceleration of Certain Credits
6-3.1-26-16. Shareholder or Partner Entitled to Credit; Acceleration of Certain Credits
6-3.1-26-18. Agreement for Credit; Conditions
6-3.1-26-19. Credit Disallowed for Relocated Jobs
6-3.1-26-20. Certification of Qualified Investments
6-3.1-26-21. Agreement for Credit; Contents
6-3.1-26-22. Certificate of Verification
6-3.1-26-23. Noncompliance With Agreement; Assessments