Indiana Code 6-3.1-4-2.5. Amount of credit; alternative computation
(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.
Terms Used In Indiana Code 6-3.1-4-2.5
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Indiana qualified research expense: means qualified research expense that is incurred for research conducted in Indiana. See Indiana Code 6-3.1-4-1
- Qualified research expense: means qualified research expense (as defined in Section 41(b) of the Internal Revenue Code). See Indiana Code 6-3.1-4-1
- Research expense tax credit: means a credit provided under this chapter against any tax otherwise due and payable under IC 6-3. See Indiana Code 6-3.1-4-1
- 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). See Indiana Code 6-3.1-4-1
- United States: includes the District of Columbia and the commonwealths, possessions, states in free association with the United States, and the territories. See Indiana Code 1-1-4-5
- Year: means a calendar year, unless otherwise expressed. See Indiana Code 1-1-4-5
(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.