Indiana 2023 Regular Session

Indiana Senate Bill SB0319 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	Introduced Version
3	3	SENATE BILL No. 319
4	4	_____
5	5	DIGEST OF INTRODUCED BILL
6	6	Citations Affected: IC 6-3-1-3.5; IC 6-3-2-27.
7	7	Synopsis: Dependent child exemptions. Provides that a fetus is
8	8	considered a dependent child for purposes of the dependent child state
9	9	adjusted gross income exemptions.
10	10	Effective: January 1, 2023 (retroactive).
11	11	Zay
12	12	January 12, 2023, read first time and referred to Committee on Tax and Fiscal Policy.
13	13	2023 IN 319—LS 6455/DI 125 Introduced
14	14	First Regular Session of the 123rd General Assembly (2023)
15	15	PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
16	16	Constitution) is being amended, the text of the existing provision will appear in this style type,
17	17	additions will appear in this style type, and deletions will appear in this style type.
18	18	Additions: Whenever a new statutory provision is being enacted (or a new constitutional
19	19	provision adopted), the text of the new provision will appear in this style type. Also, the
20	20	word NEW will appear in that style type in the introductory clause of each SECTION that adds
21	21	a new provision to the Indiana Code or the Indiana Constitution.
22	22	Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
23	23	between statutes enacted by the 2022 Regular Session of the General Assembly.
24	24	SENATE BILL No. 319
25	25	A BILL FOR AN ACT to amend the Indiana Code concerning
26	26	taxation.
27	27	Be it enacted by the General Assembly of the State of Indiana:
28	28	1 SECTION 1. IC 6-3-1-3.5, AS AMENDED BY P.L.180-2022(ss),
29	29	2 SECTION 8, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
30	30	3 JANUARY 1, 2023 (RETROACTIVE)]: Sec. 3.5. When used in this
31	31	4 article, the term "adjusted gross income" shall mean the following:
32	32	5 (a) In the case of all individuals, "adjusted gross income" (as
33	33	6 defined in Section 62 of the Internal Revenue Code), modified as
34	34	7 follows:
35	35	8 (1) Subtract income that is exempt from taxation under this article
36	36	9 by the Constitution and statutes of the United States.
37	37	10 (2) Except as provided in subsection (c), add an amount equal to
38	38	11 any deduction or deductions allowed or allowable pursuant to
39	39	12 Section 62 of the Internal Revenue Code for taxes based on or
40	40	13 measured by income and levied at the state level by any state of
41	41	14 the United States.
42	42	15 (3) Subtract one thousand dollars ($1,000), or in the case of a
43	43	16 joint return filed by a husband and wife, subtract for each spouse
44	44	17 one thousand dollars ($1,000).
45	45	2023 IN 319—LS 6455/DI 125 2
46	46	1 (4) Subtract one thousand dollars ($1,000) for:
47	47	2 (A) each of the exemptions provided by Section 151(c) of the
48	48	3 Internal Revenue Code (as effective January 1, 2017), except
49	49	4 that a fetus (as defined in IC 16-18-2-128.7) is considered
50	50	5 a dependent child for purposes of this exemption if the
51	51	6 taxpayer provides the information required under
52	52	7 IC 6-3-2-27;
53	53	8 (B) each additional amount allowable under Section 63(f) of
54	54	9 the Internal Revenue Code; and
55	55	10 (C) the spouse of the taxpayer if a separate return is made by
56	56	11 the taxpayer and if the spouse, for the calendar year in which
57	57	12 the taxable year of the taxpayer begins, has no gross income
58	58	13 and is not the dependent of another taxpayer.
59	59	14 (5) Subtract each of the following:
60	60	15 (A) One thousand five hundred dollars ($1,500) for each of the
61	61	16 exemptions allowed under Section 151(c)(1)(B) of the Internal
62	62	17 Revenue Code (as effective January 1, 2004), except that a
63	63	18 fetus (as defined in IC 16-18-2-128.7) is considered a
64	64	19 dependent child for purposes of this exemption if the
65	65	20 taxpayer provides the information required under
66	66	21 IC 6-3-2-27.
67	67	22 (B) One thousand five hundred dollars ($1,500) for each
68	68	23 exemption allowed under Section 151(c) of the Internal
69	69	24 Revenue Code (as effective January 1, 2017) for an individual:
70	70	25 (i) who is less than nineteen (19) years of age or is a
71	71	26 full-time student who is less than twenty-four (24) years of
72	72	27 age;
73	73	28 (ii) for whom the taxpayer is the legal guardian; and
74	74	29 (iii) for whom the taxpayer does not claim an exemption
75	75	30 under clause (A).
76	76	31 (C) Five hundred dollars ($500) for each additional amount
77	77	32 allowable under Section 63(f)(1) of the Internal Revenue Code
78	78	33 if the federal adjusted gross income of the taxpayer, or the
79	79	34 taxpayer and the taxpayer's spouse in the case of a joint return,
80	80	35 is less than forty thousand dollars ($40,000). In the case of a
81	81	36 married individual filing a separate return, the qualifying
82	82	37 income amount in this clause is equal to twenty thousand
83	83	38 dollars ($20,000).
84	84	39 (D) Three thousand dollars ($3,000) for each exemption
85	85	40 allowed under Section 151(c) of the Internal Revenue Code (as
86	86	41 effective January 1, 2017) for an individual who is:
87	87	42 (i) an adopted child of the taxpayer; and
88	88	2023 IN 319—LS 6455/DI 125 3
89	89	1 (ii) less than nineteen (19) years of age or is a full-time
90	90	2 student who is less than twenty-four (24) years of age.
91	91	3 This amount is in addition to any amount subtracted under
92	92	4 clause (A) or (B).
93	93	5 This amount is in addition to the amount subtracted under
94	94	6 subdivision (4).
95	95	7 (6) Subtract any amounts included in federal adjusted gross
96	96	8 income under Section 111 of the Internal Revenue Code as a
97	97	9 recovery of items previously deducted as an itemized deduction
98	98	10 from adjusted gross income.
99	99	11 (7) Subtract any amounts included in federal adjusted gross
100	100	12 income under the Internal Revenue Code which amounts were
101	101	13 received by the individual as supplemental railroad retirement
102	102	14 annuities under 45 U.S.C. 231 and which are not deductible under
103	103	15 subdivision (1).
104	104	16 (8) Subtract an amount equal to the amount of federal Social
105	105	17 Security and Railroad Retirement benefits included in a taxpayer's
106	106	18 federal gross income by Section 86 of the Internal Revenue Code.
107	107	19 (9) In the case of a nonresident taxpayer or a resident taxpayer
108	108	20 residing in Indiana for a period of less than the taxpayer's entire
109	109	21 taxable year, the total amount of the deductions allowed pursuant
110	110	22 to subdivisions (3), (4), and (5) shall be reduced to an amount
111	111	23 which bears the same ratio to the total as the taxpayer's income
112	112	24 taxable in Indiana bears to the taxpayer's total income.
113	113	25 (10) In the case of an individual who is a recipient of assistance
114	114	26 under IC 12-10-6-1, IC 12-10-6-2.1, IC 12-15-2-2, or IC 12-15-7,
115	115	27 subtract an amount equal to that portion of the individual's
116	116	28 adjusted gross income with respect to which the individual is not
117	117	29 allowed under federal law to retain an amount to pay state and
118	118	30 local income taxes.
119	119	31 (11) In the case of an eligible individual, subtract the amount of
120	120	32 a Holocaust victim's settlement payment included in the
121	121	33 individual's federal adjusted gross income.
122	122	34 (12) Subtract an amount equal to the portion of any premiums
123	123	35 paid during the taxable year by the taxpayer for a qualified long
124	124	36 term care policy (as defined in IC 12-15-39.6-5) for the taxpayer
125	125	37 or the taxpayer's spouse if the taxpayer and the taxpayer's spouse
126	126	38 file a joint income tax return or the taxpayer is otherwise entitled
127	127	39 to a deduction under this subdivision for the taxpayer's spouse, or
128	128	40 both.
129	129	41 (13) Subtract an amount equal to the lesser of:
130	130	42 (A) two thousand five hundred dollars ($2,500), or one
131	131	2023 IN 319—LS 6455/DI 125 4
132	132	1 thousand two hundred fifty dollars ($1,250) in the case of a
133	133	2 married individual filing a separate return; or
134	134	3 (B) the amount of property taxes that are paid during the
135	135	4 taxable year in Indiana by the individual on the individual's
136	136	5 principal place of residence.
137	137	6 (14) Subtract an amount equal to the amount of a September 11
138	138	7 terrorist attack settlement payment included in the individual's
139	139	8 federal adjusted gross income.
140	140	9 (15) Add or subtract the amount necessary to make the adjusted
141	141	10 gross income of any taxpayer that owns property for which bonus
142	142	11 depreciation was allowed in the current taxable year or in an
143	143	12 earlier taxable year equal to the amount of adjusted gross income
144	144	13 that would have been computed had an election not been made
145	145	14 under Section 168(k) of the Internal Revenue Code to apply bonus
146	146	15 depreciation to the property in the year that it was placed in
147	147	16 service.
148	148	17 (16) Add an amount equal to any deduction allowed under
149	149	18 Section 172 of the Internal Revenue Code (concerning net
150	150	19 operating losses).
151	151	20 (17) Add or subtract the amount necessary to make the adjusted
152	152	21 gross income of any taxpayer that placed Section 179 property (as
153	153	22 defined in Section 179 of the Internal Revenue Code) in service
154	154	23 in the current taxable year or in an earlier taxable year equal to
155	155	24 the amount of adjusted gross income that would have been
156	156	25 computed had an election for federal income tax purposes not
157	157	26 been made for the year in which the property was placed in
158	158	27 service to take deductions under Section 179 of the Internal
159	159	28 Revenue Code in a total amount exceeding the sum of:
160	160	29 (A) twenty-five thousand dollars ($25,000) to the extent
161	161	30 deductions under Section 179 of the Internal Revenue Code
162	162	31 were not elected as provided in clause (B); and
163	163	32 (B) for taxable years beginning after December 31, 2017, the
164	164	33 deductions elected under Section 179 of the Internal Revenue
165	165	34 Code on property acquired in an exchange if:
166	166	35 (i) the exchange would have been eligible for
167	167	36 nonrecognition of gain or loss under Section 1031 of the
168	168	37 Internal Revenue Code in effect on January 1, 2017;
169	169	38 (ii) the exchange is not eligible for nonrecognition of gain or
170	170	39 loss under Section 1031 of the Internal Revenue Code; and
171	171	40 (iii) the taxpayer made an election to take deductions under
172	172	41 Section 179 of the Internal Revenue Code with regard to the
173	173	42 acquired property in the year that the property was placed
174	174	2023 IN 319—LS 6455/DI 125 5
175	175	1 into service.
176	176	2 The amount of deductions allowable for an item of property
177	177	3 under this clause may not exceed the amount of adjusted gross
178	178	4 income realized on the property that would have been deferred
179	179	5 under the Internal Revenue Code in effect on January 1, 2017.
180	180	6 (18) Subtract an amount equal to the amount of the taxpayer's
181	181	7 qualified military income that was not excluded from the
182	182	8 taxpayer's gross income for federal income tax purposes under
183	183	9 Section 112 of the Internal Revenue Code.
184	184	10 (19) Subtract income that is:
185	185	11 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
186	186	12 derived from patents); and
187	187	13 (B) included in the individual's federal adjusted gross income
188	188	14 under the Internal Revenue Code.
189	189	15 (20) Add an amount equal to any income not included in gross
190	190	16 income as a result of the deferral of income arising from business
191	191	17 indebtedness discharged in connection with the reacquisition after
192	192	18 December 31, 2008, and before January 1, 2011, of an applicable
193	193	19 debt instrument, as provided in Section 108(i) of the Internal
194	194	20 Revenue Code. Subtract the amount necessary from the adjusted
195	195	21 gross income of any taxpayer that added an amount to adjusted
196	196	22 gross income in a previous year to offset the amount included in
197	197	23 federal gross income as a result of the deferral of income arising
198	198	24 from business indebtedness discharged in connection with the
199	199	25 reacquisition after December 31, 2008, and before January 1,
200	200	26 2011, of an applicable debt instrument, as provided in Section
201	201	27 108(i) of the Internal Revenue Code.
202	202	28 (21) Add the amount excluded from federal gross income under
203	203	29 Section 103 of the Internal Revenue Code for interest received on
204	204	30 an obligation of a state other than Indiana, or a political
205	205	31 subdivision of such a state, that is acquired by the taxpayer after
206	206	32 December 31, 2011.
207	207	33 (22) Subtract an amount as described in Section 1341(a)(2) of the
208	208	34 Internal Revenue Code to the extent, if any, that the amount was
209	209	35 previously included in the taxpayer's adjusted gross income for a
210	210	36 prior taxable year.
211	211	37 (23) For taxable years beginning after December 25, 2016, add an
212	212	38 amount equal to the deduction for deferred foreign income that
213	213	39 was claimed by the taxpayer for the taxable year under Section
214	214	40 965(c) of the Internal Revenue Code.
215	215	41 (24) Subtract any interest expense paid or accrued in the current
216	216	42 taxable year but not deducted as a result of the limitation imposed
217	217	2023 IN 319—LS 6455/DI 125 6
218	218	1 under Section 163(j)(1) of the Internal Revenue Code. Add any
219	219	2 interest expense paid or accrued in a previous taxable year but
220	220	3 allowed as a deduction under Section 163 of the Internal Revenue
221	221	4 Code in the current taxable year. For purposes of this subdivision,
222	222	5 an interest expense is considered paid or accrued only in the first
223	223	6 taxable year the deduction would have been allowable under
224	224	7 Section 163 of the Internal Revenue Code if the limitation under
225	225	8 Section 163(j)(1) of the Internal Revenue Code did not exist.
226	226	9 (25) Subtract the amount that would have been excluded from
227	227	10 gross income but for the enactment of Section 118(b)(2) of the
228	228	11 Internal Revenue Code for taxable years ending after December
229	229	12 22, 2017.
230	230	13 (26) For taxable years beginning after December 31, 2019, and
231	231	14 before January 1, 2021, add an amount of the deduction claimed
232	232	15 under Section 62(a)(22) of the Internal Revenue Code.
233	233	16 (27) For taxable years beginning after December 31, 2019, for
234	234	17 payments made by an employer under an education assistance
235	235	18 program after March 27, 2020:
236	236	19 (A) add the amount of payments by an employer that are
237	237	20 excluded from the taxpayer's federal gross income under
238	238	21 Section 127(c)(1)(B) of the Internal Revenue Code; and
239	239	22 (B) deduct the interest allowable under Section 221 of the
240	240	23 Internal Revenue Code, if the disallowance under Section
241	241	24 221(e)(1) of the Internal Revenue Code did not apply to the
242	242	25 payments described in clause (A). For purposes of applying
243	243	26 Section 221(b) of the Internal Revenue Code to the amount
244	244	27 allowable under this clause, the amount under clause (A) shall
245	245	28 not be added to adjusted gross income.
246	246	29 (28) Add an amount equal to the remainder of:
247	247	30 (A) the amount allowable as a deduction under Section 274(n)
248	248	31 of the Internal Revenue Code; minus
249	249	32 (B) the amount otherwise allowable as a deduction under
250	250	33 Section 274(n) of the Internal Revenue Code, if Section
251	251	34 274(n)(2)(D) of the Internal Revenue Code was not in effect
252	252	35 for amounts paid or incurred after December 31, 2020.
253	253	36 (29) For taxable years beginning after December 31, 2017, and
254	254	37 before January 1, 2021, add an amount equal to the excess
255	255	38 business loss of the taxpayer as defined in Section 461(l)(3) of the
256	256	39 Internal Revenue Code. In addition:
257	257	40 (A) If a taxpayer has an excess business loss under this
258	258	41 subdivision and also has modifications under subdivisions (15)
259	259	42 and (17) for property placed in service during the taxable year,
260	260	2023 IN 319—LS 6455/DI 125 7
261	261	1 the taxpayer shall treat a portion of the taxable year
262	262	2 modifications for that property as occurring in the taxable year
263	263	3 the property is placed in service and a portion of the
264	264	4 modifications as occurring in the immediately following
265	265	5 taxable year.
266	266	6 (B) The portion of the modifications under subdivisions (15)
267	267	7 and (17) for property placed in service during the taxable year
268	268	8 treated as occurring in the taxable year in which the property
269	269	9 is placed in service equals:
270	270	10 (i) the modification for the property otherwise determined
271	271	11 under this section; minus
272	272	12 (ii) the excess business loss disallowed under this
273	273	13 subdivision;
274	274	14 but not less than zero (0).
275	275	15 (C) The portion of the modifications under subdivisions (15)
276	276	16 and (17) for property placed in service during the taxable year
277	277	17 treated as occurring in the taxable year immediately following
278	278	18 the taxable year in which the property is placed in service
279	279	19 equals the modification for the property otherwise determined
280	280	20 under this section minus the amount in clause (B).
281	281	21 (D) Any reallocation of modifications between taxable years
282	282	22 under clauses (B) and (C) shall be first allocated to the
283	283	23 modification under subdivision (15), then to the modification
284	284	24 under subdivision (17).
285	285	25 (30) Add an amount equal to the amount excluded from federal
286	286	26 gross income under Section 108(f)(5) of the Internal Revenue
287	287	27 Code. For purposes of this subdivision:
288	288	28 (A) if an amount excluded under Section 108(f)(5) of the
289	289	29 Internal Revenue Code would be excludible under Section
290	290	30 108(a)(1)(B) of the Internal Revenue Code, the exclusion
291	291	31 under Section 108(a)(1)(B) of the Internal Revenue Code shall
292	292	32 take precedence; and
293	293	33 (B) if an amount would have been excludible under Section
294	294	34 108(f)(5) of the Internal Revenue Code as in effect on January
295	295	35 1, 2020, the amount is not required to be added back under this
296	296	36 subdivision.
297	297	37 (31) For taxable years ending after March 12, 2020, subtract an
298	298	38 amount equal to the deduction disallowed pursuant to:
299	299	39 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
300	300	40 as modified by Sections 206 and 207 of the Taxpayer Certainty
301	301	41 and Disaster Relief Tax Act (Division EE of Public Law
302	302	42 116-260); and
303	303	2023 IN 319—LS 6455/DI 125 8
304	304	1 (B) Section 3134(e) of the Internal Revenue Code.
305	305	2 (32) Subtract the amount of an annual grant amount distributed to
306	306	3 a taxpayer's Indiana education scholarship account under
307	307	4 IC 20-51.4-4-2 that is used for a qualified expense (as defined in
308	308	5 IC 20-51.4-2-9) or to an Indiana enrichment scholarship account
309	309	6 under IC 20-52 that is used for qualified expenses (as defined in
310	310	7 IC 20-52-2-6), to the extent the distribution used for the qualified
311	311	8 expense is included in the taxpayer's federal adjusted gross
312	312	9 income under the Internal Revenue Code.
313	313	10 (33) For taxable years beginning after December 31, 2019, and
314	314	11 before January 1, 2021, add an amount equal to the amount of
315	315	12 unemployment compensation excluded from federal gross income
316	316	13 under Section 85(c) of the Internal Revenue Code.
317	317	14 (34) For taxable years beginning after December 31, 2022,
318	318	15 subtract an amount equal to the deduction disallowed under
319	319	16 Section 280C(h) of the Internal Revenue Code.
320	320	17 (35) Subtract any other amounts the taxpayer is entitled to deduct
321	321	18 under IC 6-3-2.
322	322	19 (b) In the case of corporations, the same as "taxable income" (as
323	323	20 defined in Section 63 of the Internal Revenue Code) adjusted as
324	324	21 follows:
325	325	22 (1) Subtract income that is exempt from taxation under this article
326	326	23 by the Constitution and statutes of the United States.
327	327	24 (2) Add an amount equal to any deduction or deductions allowed
328	328	25 or allowable pursuant to Section 170 of the Internal Revenue
329	329	26 Code (concerning charitable contributions).
330	330	27 (3) Except as provided in subsection (c), add an amount equal to
331	331	28 any deduction or deductions allowed or allowable pursuant to
332	332	29 Section 63 of the Internal Revenue Code for taxes based on or
333	333	30 measured by income and levied at the state level by any state of
334	334	31 the United States.
335	335	32 (4) Subtract an amount equal to the amount included in the
336	336	33 corporation's taxable income under Section 78 of the Internal
337	337	34 Revenue Code (concerning foreign tax credits).
338	338	35 (5) Add or subtract the amount necessary to make the adjusted
339	339	36 gross income of any taxpayer that owns property for which bonus
340	340	37 depreciation was allowed in the current taxable year or in an
341	341	38 earlier taxable year equal to the amount of adjusted gross income
342	342	39 that would have been computed had an election not been made
343	343	40 under Section 168(k) of the Internal Revenue Code to apply bonus
344	344	41 depreciation to the property in the year that it was placed in
345	345	42 service.
346	346	2023 IN 319—LS 6455/DI 125 9
347	347	1 (6) Add an amount equal to any deduction allowed under Section
348	348	2 172 of the Internal Revenue Code (concerning net operating
349	349	3 losses).
350	350	4 (7) Add or subtract the amount necessary to make the adjusted
351	351	5 gross income of any taxpayer that placed Section 179 property (as
352	352	6 defined in Section 179 of the Internal Revenue Code) in service
353	353	7 in the current taxable year or in an earlier taxable year equal to
354	354	8 the amount of adjusted gross income that would have been
355	355	9 computed had an election for federal income tax purposes not
356	356	10 been made for the year in which the property was placed in
357	357	11 service to take deductions under Section 179 of the Internal
358	358	12 Revenue Code in a total amount exceeding the sum of:
359	359	13 (A) twenty-five thousand dollars ($25,000) to the extent
360	360	14 deductions under Section 179 of the Internal Revenue Code
361	361	15 were not elected as provided in clause (B); and
362	362	16 (B) for taxable years beginning after December 31, 2017, the
363	363	17 deductions elected under Section 179 of the Internal Revenue
364	364	18 Code on property acquired in an exchange if:
365	365	19 (i) the exchange would have been eligible for
366	366	20 nonrecognition of gain or loss under Section 1031 of the
367	367	21 Internal Revenue Code in effect on January 1, 2017;
368	368	22 (ii) the exchange is not eligible for nonrecognition of gain or
369	369	23 loss under Section 1031 of the Internal Revenue Code; and
370	370	24 (iii) the taxpayer made an election to take deductions under
371	371	25 Section 179 of the Internal Revenue Code with regard to the
372	372	26 acquired property in the year that the property was placed
373	373	27 into service.
374	374	28 The amount of deductions allowable for an item of property
375	375	29 under this clause may not exceed the amount of adjusted gross
376	376	30 income realized on the property that would have been deferred
377	377	31 under the Internal Revenue Code in effect on January 1, 2017.
378	378	32 (8) Add to the extent required by IC 6-3-2-20:
379	379	33 (A) the amount of intangible expenses (as defined in
380	380	34 IC 6-3-2-20) for the taxable year that reduced the corporation's
381	381	35 taxable income (as defined in Section 63 of the Internal
382	382	36 Revenue Code) for federal income tax purposes; and
383	383	37 (B) any directly related interest expenses (as defined in
384	384	38 IC 6-3-2-20) that reduced the corporation's adjusted gross
385	385	39 income (determined without regard to this subdivision). For
386	386	40 purposes of this clause, any directly related interest expense
387	387	41 that constitutes business interest within the meaning of Section
388	388	42 163(j) of the Internal Revenue Code shall be considered to
389	389	2023 IN 319—LS 6455/DI 125 10
390	390	1 have reduced the taxpayer's federal taxable income only in the
391	391	2 first taxable year in which the deduction otherwise would have
392	392	3 been allowable under Section 163 of the Internal Revenue
393	393	4 Code if the limitation under Section 163(j)(1) of the Internal
394	394	5 Revenue Code did not exist.
395	395	6 (9) Add an amount equal to any deduction for dividends paid (as
396	396	7 defined in Section 561 of the Internal Revenue Code) to
397	397	8 shareholders of a captive real estate investment trust (as defined
398	398	9 in section 34.5 of this chapter).
399	399	10 (10) Subtract income that is:
400	400	11 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
401	401	12 derived from patents); and
402	402	13 (B) included in the corporation's taxable income under the
403	403	14 Internal Revenue Code.
404	404	15 (11) Add an amount equal to any income not included in gross
405	405	16 income as a result of the deferral of income arising from business
406	406	17 indebtedness discharged in connection with the reacquisition after
407	407	18 December 31, 2008, and before January 1, 2011, of an applicable
408	408	19 debt instrument, as provided in Section 108(i) of the Internal
409	409	20 Revenue Code. Subtract from the adjusted gross income of any
410	410	21 taxpayer that added an amount to adjusted gross income in a
411	411	22 previous year the amount necessary to offset the amount included
412	412	23 in federal gross income as a result of the deferral of income
413	413	24 arising from business indebtedness discharged in connection with
414	414	25 the reacquisition after December 31, 2008, and before January 1,
415	415	26 2011, of an applicable debt instrument, as provided in Section
416	416	27 108(i) of the Internal Revenue Code.
417	417	28 (12) Add the amount excluded from federal gross income under
418	418	29 Section 103 of the Internal Revenue Code for interest received on
419	419	30 an obligation of a state other than Indiana, or a political
420	420	31 subdivision of such a state, that is acquired by the taxpayer after
421	421	32 December 31, 2011.
422	422	33 (13) For taxable years beginning after December 25, 2016:
423	423	34 (A) for a corporation other than a real estate investment trust,
424	424	35 add:
425	425	36 (i) an amount equal to the amount reported by the taxpayer
426	426	37 on IRC 965 Transition Tax Statement, line 1; or
427	427	38 (ii) if the taxpayer deducted an amount under Section 965(c)
428	428	39 of the Internal Revenue Code in determining the taxpayer's
429	429	40 taxable income for purposes of the federal income tax, the
430	430	41 amount deducted under Section 965(c) of the Internal
431	431	42 Revenue Code; and
432	432	2023 IN 319—LS 6455/DI 125 11
433	433	1 (B) for a real estate investment trust, add an amount equal to
434	434	2 the deduction for deferred foreign income that was claimed by
435	435	3 the taxpayer for the taxable year under Section 965(c) of the
436	436	4 Internal Revenue Code, but only to the extent that the taxpayer
437	437	5 included income pursuant to Section 965 of the Internal
438	438	6 Revenue Code in its taxable income for federal income tax
439	439	7 purposes or is required to add back dividends paid under
440	440	8 subdivision (9).
441	441	9 (14) Add an amount equal to the deduction that was claimed by
442	442	10 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
443	443	11 Internal Revenue Code (attributable to global intangible
444	444	12 low-taxed income). The taxpayer shall separately specify the
445	445	13 amount of the reduction under Section 250(a)(1)(B)(i) of the
446	446	14 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
447	447	15 Internal Revenue Code.
448	448	16 (15) Subtract any interest expense paid or accrued in the current
449	449	17 taxable year but not deducted as a result of the limitation imposed
450	450	18 under Section 163(j)(1) of the Internal Revenue Code. Add any
451	451	19 interest expense paid or accrued in a previous taxable year but
452	452	20 allowed as a deduction under Section 163 of the Internal Revenue
453	453	21 Code in the current taxable year. For purposes of this subdivision,
454	454	22 an interest expense is considered paid or accrued only in the first
455	455	23 taxable year the deduction would have been allowable under
456	456	24 Section 163 of the Internal Revenue Code if the limitation under
457	457	25 Section 163(j)(1) of the Internal Revenue Code did not exist.
458	458	26 (16) Subtract the amount that would have been excluded from
459	459	27 gross income but for the enactment of Section 118(b)(2) of the
460	460	28 Internal Revenue Code for taxable years ending after December
461	461	29 22, 2017.
462	462	30 (17) Add an amount equal to the remainder of:
463	463	31 (A) the amount allowable as a deduction under Section 274(n)
464	464	32 of the Internal Revenue Code; minus
465	465	33 (B) the amount otherwise allowable as a deduction under
466	466	34 Section 274(n) of the Internal Revenue Code, if Section
467	467	35 274(n)(2)(D) of the Internal Revenue Code was not in effect
468	468	36 for amounts paid or incurred after December 31, 2020.
469	469	37 (18) For taxable years ending after March 12, 2020, subtract an
470	470	38 amount equal to the deduction disallowed pursuant to:
471	471	39 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
472	472	40 as modified by Sections 206 and 207 of the Taxpayer Certainty
473	473	41 and Disaster Relief Tax Act (Division EE of Public Law
474	474	42 116-260); and
475	475	2023 IN 319—LS 6455/DI 125 12
476	476	1 (B) Section 3134(e) of the Internal Revenue Code.
477	477	2 (19) For taxable years beginning after December 31, 2022,
478	478	3 subtract an amount equal to the deduction disallowed under
479	479	4 Section 280C(h) of the Internal Revenue Code.
480	480	5 (20) Add or subtract any other amounts the taxpayer is:
481	481	6 (A) required to add or subtract; or
482	482	7 (B) entitled to deduct;
483	483	8 under IC 6-3-2.
484	484	9 (c) The following apply to taxable years beginning after December
485	485	10 31, 2018, for purposes of the add back of any deduction allowed on the
486	486	11 taxpayer's federal income tax return for wagering taxes, as provided in
487	487	12 subsection (a)(2) if the taxpayer is an individual or subsection (b)(3) if
488	488	13 the taxpayer is a corporation:
489	489	14 (1) For taxable years beginning after December 31, 2018, and
490	490	15 before January 1, 2020, a taxpayer is required to add back under
491	491	16 this section eighty-seven and five-tenths percent (87.5%) of any
492	492	17 deduction allowed on the taxpayer's federal income tax return for
493	493	18 wagering taxes.
494	494	19 (2) For taxable years beginning after December 31, 2019, and
495	495	20 before January 1, 2021, a taxpayer is required to add back under
496	496	21 this section seventy-five percent (75%) of any deduction allowed
497	497	22 on the taxpayer's federal income tax return for wagering taxes.
498	498	23 (3) For taxable years beginning after December 31, 2020, and
499	499	24 before January 1, 2022, a taxpayer is required to add back under
500	500	25 this section sixty-two and five-tenths percent (62.5%) of any
501	501	26 deduction allowed on the taxpayer's federal income tax return for
502	502	27 wagering taxes.
503	503	28 (4) For taxable years beginning after December 31, 2021, and
504	504	29 before January 1, 2023, a taxpayer is required to add back under
505	505	30 this section fifty percent (50%) of any deduction allowed on the
506	506	31 taxpayer's federal income tax return for wagering taxes.
507	507	32 (5) For taxable years beginning after December 31, 2022, and
508	508	33 before January 1, 2024, a taxpayer is required to add back under
509	509	34 this section thirty-seven and five-tenths percent (37.5%) of any
510	510	35 deduction allowed on the taxpayer's federal income tax return for
511	511	36 wagering taxes.
512	512	37 (6) For taxable years beginning after December 31, 2023, and
513	513	38 before January 1, 2025, a taxpayer is required to add back under
514	514	39 this section twenty-five percent (25%) of any deduction allowed
515	515	40 on the taxpayer's federal income tax return for wagering taxes.
516	516	41 (7) For taxable years beginning after December 31, 2024, and
517	517	42 before January 1, 2026, a taxpayer is required to add back under
518	518	2023 IN 319—LS 6455/DI 125 13
519	519	1 this section twelve and five-tenths percent (12.5%) of any
520	520	2 deduction allowed on the taxpayer's federal income tax return for
521	521	3 wagering taxes.
522	522	4 (8) For taxable years beginning after December 31, 2025, a
523	523	5 taxpayer is not required to add back under this section any amount
524	524	6 of a deduction allowed on the taxpayer's federal income tax return
525	525	7 for wagering taxes.
526	526	8 (d) In the case of life insurance companies (as defined in Section
527	527	9 816(a) of the Internal Revenue Code) that are organized under Indiana
528	528	10 law, the same as "life insurance company taxable income" (as defined
529	529	11 in Section 801 of the Internal Revenue Code), adjusted as follows:
530	530	12 (1) Subtract income that is exempt from taxation under this article
531	531	13 by the Constitution and statutes of the United States.
532	532	14 (2) Add an amount equal to any deduction allowed or allowable
533	533	15 under Section 170 of the Internal Revenue Code (concerning
534	534	16 charitable contributions).
535	535	17 (3) Add an amount equal to a deduction allowed or allowable
536	536	18 under Section 805 or Section 832(c) of the Internal Revenue Code
537	537	19 for taxes based on or measured by income and levied at the state
538	538	20 level by any state.
539	539	21 (4) Subtract an amount equal to the amount included in the
540	540	22 company's taxable income under Section 78 of the Internal
541	541	23 Revenue Code (concerning foreign tax credits).
542	542	24 (5) Add or subtract the amount necessary to make the adjusted
543	543	25 gross income of any taxpayer that owns property for which bonus
544	544	26 depreciation was allowed in the current taxable year or in an
545	545	27 earlier taxable year equal to the amount of adjusted gross income
546	546	28 that would have been computed had an election not been made
547	547	29 under Section 168(k) of the Internal Revenue Code to apply bonus
548	548	30 depreciation to the property in the year that it was placed in
549	549	31 service.
550	550	32 (6) Add an amount equal to any deduction allowed under Section
551	551	33 172 of the Internal Revenue Code (concerning net operating
552	552	34 losses).
553	553	35 (7) Add or subtract the amount necessary to make the adjusted
554	554	36 gross income of any taxpayer that placed Section 179 property (as
555	555	37 defined in Section 179 of the Internal Revenue Code) in service
556	556	38 in the current taxable year or in an earlier taxable year equal to
557	557	39 the amount of adjusted gross income that would have been
558	558	40 computed had an election for federal income tax purposes not
559	559	41 been made for the year in which the property was placed in
560	560	42 service to take deductions under Section 179 of the Internal
561	561	2023 IN 319—LS 6455/DI 125 14
562	562	1 Revenue Code in a total amount exceeding the sum of:
563	563	2 (A) twenty-five thousand dollars ($25,000) to the extent
564	564	3 deductions under Section 179 of the Internal Revenue Code
565	565	4 were not elected as provided in clause (B); and
566	566	5 (B) for taxable years beginning after December 31, 2017, the
567	567	6 deductions elected under Section 179 of the Internal Revenue
568	568	7 Code on property acquired in an exchange if:
569	569	8 (i) the exchange would have been eligible for
570	570	9 nonrecognition of gain or loss under Section 1031 of the
571	571	10 Internal Revenue Code in effect on January 1, 2017;
572	572	11 (ii) the exchange is not eligible for nonrecognition of gain or
573	573	12 loss under Section 1031 of the Internal Revenue Code; and
574	574	13 (iii) the taxpayer made an election to take deductions under
575	575	14 Section 179 of the Internal Revenue Code with regard to the
576	576	15 acquired property in the year that the property was placed
577	577	16 into service.
578	578	17 The amount of deductions allowable for an item of property
579	579	18 under this clause may not exceed the amount of adjusted gross
580	580	19 income realized on the property that would have been deferred
581	581	20 under the Internal Revenue Code in effect on January 1, 2017.
582	582	21 (8) Subtract income that is:
583	583	22 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
584	584	23 derived from patents); and
585	585	24 (B) included in the insurance company's taxable income under
586	586	25 the Internal Revenue Code.
587	587	26 (9) Add an amount equal to any income not included in gross
588	588	27 income as a result of the deferral of income arising from business
589	589	28 indebtedness discharged in connection with the reacquisition after
590	590	29 December 31, 2008, and before January 1, 2011, of an applicable
591	591	30 debt instrument, as provided in Section 108(i) of the Internal
592	592	31 Revenue Code. Subtract from the adjusted gross income of any
593	593	32 taxpayer that added an amount to adjusted gross income in a
594	594	33 previous year the amount necessary to offset the amount included
595	595	34 in federal gross income as a result of the deferral of income
596	596	35 arising from business indebtedness discharged in connection with
597	597	36 the reacquisition after December 31, 2008, and before January 1,
598	598	37 2011, of an applicable debt instrument, as provided in Section
599	599	38 108(i) of the Internal Revenue Code.
600	600	39 (10) Add an amount equal to any exempt insurance income under
601	601	40 Section 953(e) of the Internal Revenue Code that is active
602	602	41 financing income under Subpart F of Subtitle A, Chapter 1,
603	603	42 Subchapter N of the Internal Revenue Code.
604	604	2023 IN 319—LS 6455/DI 125 15
605	605	1 (11) Add the amount excluded from federal gross income under
606	606	2 Section 103 of the Internal Revenue Code for interest received on
607	607	3 an obligation of a state other than Indiana, or a political
608	608	4 subdivision of such a state, that is acquired by the taxpayer after
609	609	5 December 31, 2011.
610	610	6 (12) For taxable years beginning after December 25, 2016, add:
611	611	7 (A) an amount equal to the amount reported by the taxpayer on
612	612	8 IRC 965 Transition Tax Statement, line 1; or
613	613	9 (B) if the taxpayer deducted an amount under Section 965(c)
614	614	10 of the Internal Revenue Code in determining the taxpayer's
615	615	11 taxable income for purposes of the federal income tax, the
616	616	12 amount deducted under Section 965(c) of the Internal Revenue
617	617	13 Code.
618	618	14 (13) Add an amount equal to the deduction that was claimed by
619	619	15 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
620	620	16 Internal Revenue Code (attributable to global intangible
621	621	17 low-taxed income). The taxpayer shall separately specify the
622	622	18 amount of the reduction under Section 250(a)(1)(B)(i) of the
623	623	19 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
624	624	20 Internal Revenue Code.
625	625	21 (14) Subtract any interest expense paid or accrued in the current
626	626	22 taxable year but not deducted as a result of the limitation imposed
627	627	23 under Section 163(j)(1) of the Internal Revenue Code. Add any
628	628	24 interest expense paid or accrued in a previous taxable year but
629	629	25 allowed as a deduction under Section 163 of the Internal Revenue
630	630	26 Code in the current taxable year. For purposes of this subdivision,
631	631	27 an interest expense is considered paid or accrued only in the first
632	632	28 taxable year the deduction would have been allowable under
633	633	29 Section 163 of the Internal Revenue Code if the limitation under
634	634	30 Section 163(j)(1) of the Internal Revenue Code did not exist.
635	635	31 (15) Subtract the amount that would have been excluded from
636	636	32 gross income but for the enactment of Section 118(b)(2) of the
637	637	33 Internal Revenue Code for taxable years ending after December
638	638	34 22, 2017.
639	639	35 (16) Add an amount equal to the remainder of:
640	640	36 (A) the amount allowable as a deduction under Section 274(n)
641	641	37 of the Internal Revenue Code; minus
642	642	38 (B) the amount otherwise allowable as a deduction under
643	643	39 Section 274(n) of the Internal Revenue Code, if Section
644	644	40 274(n)(2)(D) of the Internal Revenue Code was not in effect
645	645	41 for amounts paid or incurred after December 31, 2020.
646	646	42 (17) For taxable years ending after March 12, 2020, subtract an
647	647	2023 IN 319—LS 6455/DI 125 16
648	648	1 amount equal to the deduction disallowed pursuant to:
649	649	2 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
650	650	3 as modified by Sections 206 and 207 of the Taxpayer Certainty
651	651	4 and Disaster Relief Tax Act (Division EE of Public Law
652	652	5 116-260); and
653	653	6 (B) Section 3134(e) of the Internal Revenue Code.
654	654	7 (18) For taxable years beginning after December 31, 2022,
655	655	8 subtract an amount equal to the deduction disallowed under
656	656	9 Section 280C(h) of the Internal Revenue Code.
657	657	10 (19) Add or subtract any other amounts the taxpayer is:
658	658	11 (A) required to add or subtract; or
659	659	12 (B) entitled to deduct;
660	660	13 under IC 6-3-2.
661	661	14 (e) In the case of insurance companies subject to tax under Section
662	662	15 831 of the Internal Revenue Code and organized under Indiana law, the
663	663	16 same as "taxable income" (as defined in Section 832 of the Internal
664	664	17 Revenue Code), adjusted as follows:
665	665	18 (1) Subtract income that is exempt from taxation under this article
666	666	19 by the Constitution and statutes of the United States.
667	667	20 (2) Add an amount equal to any deduction allowed or allowable
668	668	21 under Section 170 of the Internal Revenue Code (concerning
669	669	22 charitable contributions).
670	670	23 (3) Add an amount equal to a deduction allowed or allowable
671	671	24 under Section 805 or Section 832(c) of the Internal Revenue Code
672	672	25 for taxes based on or measured by income and levied at the state
673	673	26 level by any state.
674	674	27 (4) Subtract an amount equal to the amount included in the
675	675	28 company's taxable income under Section 78 of the Internal
676	676	29 Revenue Code (concerning foreign tax credits).
677	677	30 (5) Add or subtract the amount necessary to make the adjusted
678	678	31 gross income of any taxpayer that owns property for which bonus
679	679	32 depreciation was allowed in the current taxable year or in an
680	680	33 earlier taxable year equal to the amount of adjusted gross income
681	681	34 that would have been computed had an election not been made
682	682	35 under Section 168(k) of the Internal Revenue Code to apply bonus
683	683	36 depreciation to the property in the year that it was placed in
684	684	37 service.
685	685	38 (6) Add an amount equal to any deduction allowed under Section
686	686	39 172 of the Internal Revenue Code (concerning net operating
687	687	40 losses).
688	688	41 (7) Add or subtract the amount necessary to make the adjusted
689	689	42 gross income of any taxpayer that placed Section 179 property (as
690	690	2023 IN 319—LS 6455/DI 125 17
691	691	1 defined in Section 179 of the Internal Revenue Code) in service
692	692	2 in the current taxable year or in an earlier taxable year equal to
693	693	3 the amount of adjusted gross income that would have been
694	694	4 computed had an election for federal income tax purposes not
695	695	5 been made for the year in which the property was placed in
696	696	6 service to take deductions under Section 179 of the Internal
697	697	7 Revenue Code in a total amount exceeding the sum of:
698	698	8 (A) twenty-five thousand dollars ($25,000) to the extent
699	699	9 deductions under Section 179 of the Internal Revenue Code
700	700	10 were not elected as provided in clause (B); and
701	701	11 (B) for taxable years beginning after December 31, 2017, the
702	702	12 deductions elected under Section 179 of the Internal Revenue
703	703	13 Code on property acquired in an exchange if:
704	704	14 (i) the exchange would have been eligible for
705	705	15 nonrecognition of gain or loss under Section 1031 of the
706	706	16 Internal Revenue Code in effect on January 1, 2017;
707	707	17 (ii) the exchange is not eligible for nonrecognition of gain or
708	708	18 loss under Section 1031 of the Internal Revenue Code; and
709	709	19 (iii) the taxpayer made an election to take deductions under
710	710	20 Section 179 of the Internal Revenue Code with regard to the
711	711	21 acquired property in the year that the property was placed
712	712	22 into service.
713	713	23 The amount of deductions allowable for an item of property
714	714	24 under this clause may not exceed the amount of adjusted gross
715	715	25 income realized on the property that would have been deferred
716	716	26 under the Internal Revenue Code in effect on January 1, 2017.
717	717	27 (8) Subtract income that is:
718	718	28 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
719	719	29 derived from patents); and
720	720	30 (B) included in the insurance company's taxable income under
721	721	31 the Internal Revenue Code.
722	722	32 (9) Add an amount equal to any income not included in gross
723	723	33 income as a result of the deferral of income arising from business
724	724	34 indebtedness discharged in connection with the reacquisition after
725	725	35 December 31, 2008, and before January 1, 2011, of an applicable
726	726	36 debt instrument, as provided in Section 108(i) of the Internal
727	727	37 Revenue Code. Subtract from the adjusted gross income of any
728	728	38 taxpayer that added an amount to adjusted gross income in a
729	729	39 previous year the amount necessary to offset the amount included
730	730	40 in federal gross income as a result of the deferral of income
731	731	41 arising from business indebtedness discharged in connection with
732	732	42 the reacquisition after December 31, 2008, and before January 1,
733	733	2023 IN 319—LS 6455/DI 125 18
734	734	1 2011, of an applicable debt instrument, as provided in Section
735	735	2 108(i) of the Internal Revenue Code.
736	736	3 (10) Add an amount equal to any exempt insurance income under
737	737	4 Section 953(e) of the Internal Revenue Code that is active
738	738	5 financing income under Subpart F of Subtitle A, Chapter 1,
739	739	6 Subchapter N of the Internal Revenue Code.
740	740	7 (11) Add the amount excluded from federal gross income under
741	741	8 Section 103 of the Internal Revenue Code for interest received on
742	742	9 an obligation of a state other than Indiana, or a political
743	743	10 subdivision of such a state, that is acquired by the taxpayer after
744	744	11 December 31, 2011.
745	745	12 (12) For taxable years beginning after December 25, 2016, add:
746	746	13 (A) an amount equal to the amount reported by the taxpayer on
747	747	14 IRC 965 Transition Tax Statement, line 1; or
748	748	15 (B) if the taxpayer deducted an amount under Section 965(c)
749	749	16 of the Internal Revenue Code in determining the taxpayer's
750	750	17 taxable income for purposes of the federal income tax, the
751	751	18 amount deducted under Section 965(c) of the Internal Revenue
752	752	19 Code.
753	753	20 (13) Add an amount equal to the deduction that was claimed by
754	754	21 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
755	755	22 Internal Revenue Code (attributable to global intangible
756	756	23 low-taxed income). The taxpayer shall separately specify the
757	757	24 amount of the reduction under Section 250(a)(1)(B)(i) of the
758	758	25 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
759	759	26 Internal Revenue Code.
760	760	27 (14) Subtract any interest expense paid or accrued in the current
761	761	28 taxable year but not deducted as a result of the limitation imposed
762	762	29 under Section 163(j)(1) of the Internal Revenue Code. Add any
763	763	30 interest expense paid or accrued in a previous taxable year but
764	764	31 allowed as a deduction under Section 163 of the Internal Revenue
765	765	32 Code in the current taxable year. For purposes of this subdivision,
766	766	33 an interest expense is considered paid or accrued only in the first
767	767	34 taxable year the deduction would have been allowable under
768	768	35 Section 163 of the Internal Revenue Code if the limitation under
769	769	36 Section 163(j)(1) of the Internal Revenue Code did not exist.
770	770	37 (15) Subtract the amount that would have been excluded from
771	771	38 gross income but for the enactment of Section 118(b)(2) of the
772	772	39 Internal Revenue Code for taxable years ending after December
773	773	40 22, 2017.
774	774	41 (16) Add an amount equal to the remainder of:
775	775	42 (A) the amount allowable as a deduction under Section 274(n)
776	776	2023 IN 319—LS 6455/DI 125 19
777	777	1 of the Internal Revenue Code; minus
778	778	2 (B) the amount otherwise allowable as a deduction under
779	779	3 Section 274(n) of the Internal Revenue Code, if Section
780	780	4 274(n)(2)(D) of the Internal Revenue Code was not in effect
781	781	5 for amounts paid or incurred after December 31, 2020.
782	782	6 (17) For taxable years ending after March 12, 2020, subtract an
783	783	7 amount equal to the deduction disallowed pursuant to:
784	784	8 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
785	785	9 as modified by Sections 206 and 207 of the Taxpayer Certainty
786	786	10 and Disaster Relief Tax Act (Division EE of Public Law
787	787	11 116-260); and
788	788	12 (B) Section 3134(e) of the Internal Revenue Code.
789	789	13 (18) For taxable years beginning after December 31, 2022,
790	790	14 subtract an amount equal to the deduction disallowed under
791	791	15 Section 280C(h) of the Internal Revenue Code.
792	792	16 (19) Add or subtract any other amounts the taxpayer is:
793	793	17 (A) required to add or subtract; or
794	794	18 (B) entitled to deduct;
795	795	19 under IC 6-3-2.
796	796	20 (f) In the case of trusts and estates, "taxable income" (as defined for
797	797	21 trusts and estates in Section 641(b) of the Internal Revenue Code)
798	798	22 adjusted as follows:
799	799	23 (1) Subtract income that is exempt from taxation under this article
800	800	24 by the Constitution and statutes of the United States.
801	801	25 (2) Subtract an amount equal to the amount of a September 11
802	802	26 terrorist attack settlement payment included in the federal
803	803	27 adjusted gross income of the estate of a victim of the September
804	804	28 11 terrorist attack or a trust to the extent the trust benefits a victim
805	805	29 of the September 11 terrorist attack.
806	806	30 (3) Add or subtract the amount necessary to make the adjusted
807	807	31 gross income of any taxpayer that owns property for which bonus
808	808	32 depreciation was allowed in the current taxable year or in an
809	809	33 earlier taxable year equal to the amount of adjusted gross income
810	810	34 that would have been computed had an election not been made
811	811	35 under Section 168(k) of the Internal Revenue Code to apply bonus
812	812	36 depreciation to the property in the year that it was placed in
813	813	37 service.
814	814	38 (4) Add an amount equal to any deduction allowed under Section
815	815	39 172 of the Internal Revenue Code (concerning net operating
816	816	40 losses).
817	817	41 (5) Add or subtract the amount necessary to make the adjusted
818	818	42 gross income of any taxpayer that placed Section 179 property (as
819	819	2023 IN 319—LS 6455/DI 125 20
820	820	1 defined in Section 179 of the Internal Revenue Code) in service
821	821	2 in the current taxable year or in an earlier taxable year equal to
822	822	3 the amount of adjusted gross income that would have been
823	823	4 computed had an election for federal income tax purposes not
824	824	5 been made for the year in which the property was placed in
825	825	6 service to take deductions under Section 179 of the Internal
826	826	7 Revenue Code in a total amount exceeding the sum of:
827	827	8 (A) twenty-five thousand dollars ($25,000) to the extent
828	828	9 deductions under Section 179 of the Internal Revenue Code
829	829	10 were not elected as provided in clause (B); and
830	830	11 (B) for taxable years beginning after December 31, 2017, the
831	831	12 deductions elected under Section 179 of the Internal Revenue
832	832	13 Code on property acquired in an exchange if:
833	833	14 (i) the exchange would have been eligible for
834	834	15 nonrecognition of gain or loss under Section 1031 of the
835	835	16 Internal Revenue Code in effect on January 1, 2017;
836	836	17 (ii) the exchange is not eligible for nonrecognition of gain or
837	837	18 loss under Section 1031 of the Internal Revenue Code; and
838	838	19 (iii) the taxpayer made an election to take deductions under
839	839	20 Section 179 of the Internal Revenue Code with regard to the
840	840	21 acquired property in the year that the property was placed
841	841	22 into service.
842	842	23 The amount of deductions allowable for an item of property
843	843	24 under this clause may not exceed the amount of adjusted gross
844	844	25 income realized on the property that would have been deferred
845	845	26 under the Internal Revenue Code in effect on January 1, 2017.
846	846	27 (6) Subtract income that is:
847	847	28 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
848	848	29 derived from patents); and
849	849	30 (B) included in the taxpayer's taxable income under the
850	850	31 Internal Revenue Code.
851	851	32 (7) Add an amount equal to any income not included in gross
852	852	33 income as a result of the deferral of income arising from business
853	853	34 indebtedness discharged in connection with the reacquisition after
854	854	35 December 31, 2008, and before January 1, 2011, of an applicable
855	855	36 debt instrument, as provided in Section 108(i) of the Internal
856	856	37 Revenue Code. Subtract from the adjusted gross income of any
857	857	38 taxpayer that added an amount to adjusted gross income in a
858	858	39 previous year the amount necessary to offset the amount included
859	859	40 in federal gross income as a result of the deferral of income
860	860	41 arising from business indebtedness discharged in connection with
861	861	42 the reacquisition after December 31, 2008, and before January 1,
862	862	2023 IN 319—LS 6455/DI 125 21
863	863	1 2011, of an applicable debt instrument, as provided in Section
864	864	2 108(i) of the Internal Revenue Code.
865	865	3 (8) Add the amount excluded from federal gross income under
866	866	4 Section 103 of the Internal Revenue Code for interest received on
867	867	5 an obligation of a state other than Indiana, or a political
868	868	6 subdivision of such a state, that is acquired by the taxpayer after
869	869	7 December 31, 2011.
870	870	8 (9) For taxable years beginning after December 25, 2016, add an
871	871	9 amount equal to:
872	872	10 (A) the amount reported by the taxpayer on IRC 965
873	873	11 Transition Tax Statement, line 1;
874	874	12 (B) if the taxpayer deducted an amount under Section 965(c)
875	875	13 of the Internal Revenue Code in determining the taxpayer's
876	876	14 taxable income for purposes of the federal income tax, the
877	877	15 amount deducted under Section 965(c) of the Internal Revenue
878	878	16 Code; and
879	879	17 (C) with regard to any amounts of income under Section 965
880	880	18 of the Internal Revenue Code distributed by the taxpayer, the
881	881	19 deduction under Section 965(c) of the Internal Revenue Code
882	882	20 attributable to such distributed amounts and not reported to the
883	883	21 beneficiary.
884	884	22 For purposes of this article, the amount required to be added back
885	885	23 under clause (B) is not considered to be distributed or
886	886	24 distributable to a beneficiary of the estate or trust for purposes of
887	887	25 Sections 651 and 661 of the Internal Revenue Code.
888	888	26 (10) Subtract any interest expense paid or accrued in the current
889	889	27 taxable year but not deducted as a result of the limitation imposed
890	890	28 under Section 163(j)(1) of the Internal Revenue Code. Add any
891	891	29 interest expense paid or accrued in a previous taxable year but
892	892	30 allowed as a deduction under Section 163 of the Internal Revenue
893	893	31 Code in the current taxable year. For purposes of this subdivision,
894	894	32 an interest expense is considered paid or accrued only in the first
895	895	33 taxable year the deduction would have been allowable under
896	896	34 Section 163 of the Internal Revenue Code if the limitation under
897	897	35 Section 163(j)(1) of the Internal Revenue Code did not exist.
898	898	36 (11) Add an amount equal to the deduction for qualified business
899	899	37 income that was claimed by the taxpayer for the taxable year
900	900	38 under Section 199A of the Internal Revenue Code.
901	901	39 (12) Subtract the amount that would have been excluded from
902	902	40 gross income but for the enactment of Section 118(b)(2) of the
903	903	41 Internal Revenue Code for taxable years ending after December
904	904	42 22, 2017.
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906	906	1 (13) Add an amount equal to the remainder of:
907	907	2 (A) the amount allowable as a deduction under Section 274(n)
908	908	3 of the Internal Revenue Code; minus
909	909	4 (B) the amount otherwise allowable as a deduction under
910	910	5 Section 274(n) of the Internal Revenue Code, if Section
911	911	6 274(n)(2)(D) of the Internal Revenue Code was not in effect
912	912	7 for amounts paid or incurred after December 31, 2020.
913	913	8 (14) For taxable years beginning after December 31, 2017, and
914	914	9 before January 1, 2021, add an amount equal to the excess
915	915	10 business loss of the taxpayer as defined in Section 461(l)(3) of the
916	916	11 Internal Revenue Code. In addition:
917	917	12 (A) If a taxpayer has an excess business loss under this
918	918	13 subdivision and also has modifications under subdivisions (3)
919	919	14 and (5) for property placed in service during the taxable year,
920	920	15 the taxpayer shall treat a portion of the taxable year
921	921	16 modifications for that property as occurring in the taxable year
922	922	17 the property is placed in service and a portion of the
923	923	18 modifications as occurring in the immediately following
924	924	19 taxable year.
925	925	20 (B) The portion of the modifications under subdivisions (3)
926	926	21 and (5) for property placed in service during the taxable year
927	927	22 treated as occurring in the taxable year in which the property
928	928	23 is placed in service equals:
929	929	24 (i) the modification for the property otherwise determined
930	930	25 under this section; minus
931	931	26 (ii) the excess business loss disallowed under this
932	932	27 subdivision;
933	933	28 but not less than zero (0).
934	934	29 (C) The portion of the modifications under subdivisions (3)
935	935	30 and (5) for property placed in service during the taxable year
936	936	31 treated as occurring in the taxable year immediately following
937	937	32 the taxable year in which the property is placed in service
938	938	33 equals the modification for the property otherwise determined
939	939	34 under this section minus the amount in clause (B).
940	940	35 (D) Any reallocation of modifications between taxable years
941	941	36 under clauses (B) and (C) shall be first allocated to the
942	942	37 modification under subdivision (3), then to the modification
943	943	38 under subdivision (5).
944	944	39 (15) For taxable years ending after March 12, 2020, subtract an
945	945	40 amount equal to the deduction disallowed pursuant to:
946	946	41 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
947	947	42 as modified by Sections 206 and 207 of the Taxpayer Certainty
948	948	2023 IN 319—LS 6455/DI 125 23
949	949	1 and Disaster Relief Tax Act (Division EE of Public Law
950	950	2 116-260); and
951	951	3 (B) Section 3134(e) of the Internal Revenue Code.
952	952	4 (16) For taxable years beginning after December 31, 2022,
953	953	5 subtract an amount equal to the deduction disallowed under
954	954	6 Section 280C(h) of the Internal Revenue Code.
955	955	7 (17) Add or subtract any other amounts the taxpayer is:
956	956	8 (A) required to add or subtract; or
957	957	9 (B) entitled to deduct;
958	958	10 under IC 6-3-2.
959	959	11 (g) Subsections (a)(35), (b)(20), (d)(19), (e)(19), or (f)(17) may not
960	960	12 be construed to require an add back or allow a deduction or exemption
961	961	13 more than once for a particular add back, deduction, or exemption.
962	962	14 (h) For taxable years beginning after December 25, 2016, if:
963	963	15 (1) a taxpayer is a shareholder, either directly or indirectly, in a
964	964	16 corporation that is an E&P deficit foreign corporation as defined
965	965	17 in Section 965(b)(3)(B) of the Internal Revenue Code, and the
966	966	18 earnings and profit deficit, or a portion of the earnings and profit
967	967	19 deficit, of the E&P deficit foreign corporation is permitted to
968	968	20 reduce the federal adjusted gross income or federal taxable
969	969	21 income of the taxpayer, the deficit, or the portion of the deficit,
970	970	22 shall also reduce the amount taxable under this section to the
971	971	23 extent permitted under the Internal Revenue Code, however, in no
972	972	24 case shall this permit a reduction in the amount taxable under
973	973	25 Section 965 of the Internal Revenue Code for purposes of this
974	974	26 section to be less than zero (0); and
975	975	27 (2) the Internal Revenue Service issues guidance that such an
976	976	28 income or deduction is not reported directly on a federal tax
977	977	29 return or is to be reported in a manner different than specified in
978	978	30 this section, this section shall be construed as if federal adjusted
979	979	31 gross income or federal taxable income included the income or
980	980	32 deduction.
981	981	33 (i) If a partner is required to include an item of income, a deduction,
982	982	34 or another tax attribute in the partner's adjusted gross income tax return
983	983	35 pursuant to IC 6-3-4.5, such item shall be considered to be includible
984	984	36 in the partner's federal adjusted gross income or federal taxable
985	985	37 income, regardless of whether such item is actually required to be
986	986	38 reported by the partner for federal income tax purposes. For purposes
987	987	39 of this subsection:
988	988	40 (1) items for which a valid election is made under IC 6-3-4.5-6,
989	989	41 IC 6-3-4.5-8, or IC 6-3-4.5-9 shall not be required to be included
990	990	42 in the partner's adjusted gross income or taxable income; and
991	991	2023 IN 319—LS 6455/DI 125 24
992	992	1 (2) items for which the partnership did not make an election under
993	993	2 IC 6-3-4.5-6, IC 6-3-4.5-8, or IC 6-3-4.5-9, but for which the
994	994	3 partnership is required to remit tax pursuant to IC 6-3-4.5-18,
995	995	4 shall be included in the partner's adjusted gross income or taxable
996	996	5 income.
997	997	6 SECTION 2. IC 6-3-2-27 IS ADDED TO THE INDIANA CODE
998	998	7 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
999	999	8 JANUARY 1, 2023 (RETROACTIVE)]: Sec. 27. For a fetus to be
1000	1000	9 considered a dependent child for purposes of the exemptions in
1001	1001	10 IC 6-3-1-3.5(a)(4)(A) and IC 6-3-1-3.5(a)(5)(A), a taxpayer must
1002	1002	11 submit a report from a radiologic imaging study reflecting the
1003	1003	12 taxpayer's pregnancy during the taxable year with the taxpayer's
1004	1004	13 annual state tax return or returns in the manner prescribed by the
1005	1005	14 department.
1006	1006	15 SECTION 3. [EFFECTIVE JANUARY 1, 2023 (RETROACTIVE)]
1007	1007	16 (a) IC 6-3-1-3.5, as amended by this act, and IC 6-3-2-27, as added
1008	1008	17 by this act, apply to taxable years beginning after December 31,
1009	1009	18 2022.
1010	1010	19 (b) This SECTION expires July 1, 2026.
1011	1011	20 SECTION 4. An emergency is declared for this act.
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