Indiana Corporate Tax Credits
Taxpayers eligible for state corporate income tax credits apply the value first against gross tax liability, then against corporate adjusted gross tax liability and finally against supplemental net liability. Some credits may be applied against future tax liabilities.
- College and university contribution credit: A credit for contributions to Indiana colleges and universities. Limited to the lesser of: (a) $1,000; (b) 50% of the contribution; or (c) 10% of the adjusted gross income tax.
- Neighborhood assistance credit: Credit to corporate or individual taxpayers contributing to neighborhood organizations or who engage in activities to upgrade disadvantaged areas. Up to 50% of the amount invested, not to exceed $25,000 in any taxable year.
- Drug and alcohol abuse credit: Maximum credit is $6,250 for corporations with more than 1,000 employees, and $3,750 for corporations with fewer than 1,000 employees.
- Research expense credit: 5% Credit to any corporate taxpayer entitled to the federal research expense credit who incurs qualified Indiana research expenses.
- Teacher summer employment credit: Credit to persons who hire a public school teacher during the summer in a position that is relevant to a teaching-shortage area in which the teacher is certified. Limited to the lesser of: (a) $2,500; or (b) 50% of the compensation paid.
- Enterprise zone employment expense credit: A taxpayer who conducts business in an enterprise zone is entitled to a maximum credit of $1,500 for each employee who is an enterprise zone-resident and who is employed primarily by the taxpayer.
- Enterprise zone loan interest credit: A credit equal to 5% of the lender interest income from qualified loans made in an enterprise zone.
- Enterprise zone investment cost credit: An individual taxpayer purchasing an ownership interest in an enterprise zone business may be eligible to receive a credit of up to 30% of the purchase price against the taxpayers state tax liability.
- Industrial recovery tax credit: Credit for qualifying investments to rehabilitate vacant industrial facilities (“dinosaurs”) that are at least 20 years old and at least 300,000 square feet in size.
- Personal computer tax credit: Credit for donations of computer units to the “Buddy-Up with Education Program.” A credit of $125 per computer unit is allowed.
- Twenty-first century scholar’s program support fund credit: Credit for contributions to the fund. A maximum credit of the lesser of (a) $1,000; (b) 50% of the contribution made; or (c) 10% of the adjusted gross income tax is available.
- Maternity home credit: Credit for maternity-home owners who proved a temporary residence for a pregnant woman (women).
- Prison credit: Credit for investments in Indiana prisons to create jobs for prisoners. The amount is limited to 50% of the inventory in a qualified project plus 25% of the wages paid to the inmates. The maximum credit a taxpayer may claim is $100,000/year.
For more information on Indiana corporate income tax credits, contact: Indiana Department of Commerce.
Indiana Economic Development Corporation
The Indiana Economic Development Corporation (IEDC) is the State of Indiana’s lead economic development agency. The IEDC was officially established in February 2005 to replace the former Department of Commerce. In order to respond quickly to the needs of businesses, the IEDC operates like a business.
Led by Indiana Secretary of Commerce Victor Smith, the IEDC is organized as a public private partnership governed by a 12-member board. The IEDC Board of Directors is chaired by Governor Michael Pence and reflects the geographic and economic diversity of Indiana. The IEDC focuses its efforts on growing and retaining businesses in Indiana and attracting new business to the State.