Introduced Version




HOUSE BILL No. 1019

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DIGEST OF INTRODUCED BILL



Citations Affected: IC 6-3.1-26.

Synopsis: Hoosier business investment tax credit. Permits the Indiana economic development corporation to grant a Hoosier business investment income tax credit that is entirely or partly refundable to the taxpayer or to a pass through entity. Specifies that the corporation's discretion to grant a refundable credit applies to credit awards approved and investments made on or after July 1, 2013. Repeals a term no longer used in the Hoosier business investment tax credit statutes. (The introduced version of this bill was prepared by the interim study committee on economic development.)

Effective: July 1, 2013.



Messmer


    January 7, 2013, read first time and referred to Committee on Commerce, Small Business and Economic Development.




Introduced

First Regular Session 118th General Assembly (2013)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
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HOUSE BILL No. 1019


    A BILL FOR AN ACT to amend the Indiana Code concerning taxation.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 6-3.1-26-1; (13)IN1019.1.1. -->     SECTION 1. IC 6-3.1-26-1 IS REPEALED [EFFECTIVE JULY 1, 2013]. Sec. 1. As used in this chapter, "base state tax liability" means a taxpayer's state tax liability in the taxable year immediately preceding the taxable year in which a taxpayer makes a qualified investment.
SOURCE: IC 6-3.1-26-14; (13)IN1019.1.2. -->     SECTION 2. IC 6-3.1-26-14, AS AMENDED BY P.L.199-2005, SECTION 20, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 14. (a) The total amount of a tax credit claimed for a taxable year under this chapter is a percentage determined by the corporation, not to exceed ten percent (10%), of the amount of a qualified investment made by the taxpayer in Indiana during that taxable year. For a credit award that was approved by the corporation before July 1, 2013, and that pertained to an investment that was made before July 1, 2013, the taxpayer may carry forward any unused credit, and the taxpayer is not entitled to a carryback or refund of any unused credit.
    (b) For a credit award that was approved by the corporation on or after July 1, 2013, and that pertains to an investment made on

or after July 1, 2013, the corporation may approve a credit amount for a taxable year that exceeds the taxpayer's state tax liability for the taxable year. In such a case, all or a part of the excess may, at the discretion of the corporation, be refunded to the taxpayer. If the corporation does not approve a refund for the entire amount of the credit, the taxpayer may carry forward any unused credit.

SOURCE: IC 6-3.1-26-16; (13)IN1019.1.3. -->     SECTION 3. IC 6-3.1-26-16, AS AMENDED BY P.L.199-2005, SECTION 22, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 16. (a) If the corporation approves a refund of all or part of the credit under this chapter for a pass through entity and the credit exceeds the pass through entity's state income tax liability for the taxable year, the pass through entity is entitled to a refund of the excess. If a pass through entity does not have state tax liability against which the tax credit may be applied, the corporation does not approve a refund for the entire amount of the credit, a shareholder 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 that is not refunded; multiplied by
        (2) the percentage of the pass through entity's distributive income to which the shareholder or partner is entitled.
     (b) If the corporation grants a refund directly to a pass through entity under this section, the pass through entity shall claim the refund on forms prescribed by the department of state revenue.
SOURCE: IC 6-3.1-26-21; (13)IN1019.1.4. -->     SECTION 4. IC 6-3.1-26-21, AS AMENDED BY P.L.4-2005, SECTION 110, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 21. The corporation shall enter into an agreement with an applicant that is awarded a credit under this chapter. The agreement must include all the following:
        (1) A detailed description of the project that is the subject of the agreement.
        (2) The first taxable year for which the credit may be claimed.
        (3) The amount of the taxpayer's state tax liability for each tax in the taxable year of the taxpayer that immediately preceded the first taxable year in which the credit may be claimed.
        (4) The maximum tax credit amount that will be allowed for each taxable year and if the applicant's credit award exceeds the applicant's state tax liability for a taxable year, to what extent the excess, if any, may be refunded to the applicant.
        (5) A requirement that the taxpayer shall maintain operations at the project location for at least ten (10) years during the term that the tax credit is available.
        (6) A specific method for determining the number of new employees employed during a taxable year who are performing jobs not previously performed by an employee.
        (7) A requirement that the taxpayer shall annually report to the corporation the number of new employees who are performing jobs not previously performed by an employee, the average wage of the new employees, the average wage of all employees at the location where the qualified investment is made, and any other information the director needs to perform the director's duties under this chapter.
        (8) A requirement that the director is authorized to verify with the appropriate state agencies the amounts reported under subdivision (7), and that after doing so shall issue a certificate to the taxpayer stating that the amounts have been verified.
        (9) A requirement that the taxpayer shall pay an average wage to all its employees other than highly compensated employees in each taxable year that a tax credit is available that equals at least one hundred fifty percent (150%) of the hourly minimum wage under IC 22-2-2-4 or its equivalent.
        (10) A requirement that the taxpayer will keep the qualified investment property that is the basis for the tax credit in Indiana for at least the lesser of its useful life for federal income tax purposes or ten (10) years.
        (11) A requirement that the taxpayer will maintain at the location where the qualified investment is made during the term of the tax credit a total payroll that is at least equal to the payroll level that existed before the qualified investment was made.
        (12) A requirement that the taxpayer shall provide written notification to the director and the corporation not more than thirty (30) days after the taxpayer makes or receives a proposal that would transfer the taxpayer's state tax liability obligations to a successor taxpayer.
        (13) Any other performance conditions that the corporation determines are appropriate.