Indiana 2023 Regular Session

Indiana Senate Bill SB0359 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. 359
4	4	_____
5	5	DIGEST OF INTRODUCED BILL
6	6	Citations Affected: IC 6-1.1-49; IC 6-3-1-3.5; IC 6-3-2-6.
7	7	Synopsis: Tax matters. Provides a credit against an individual's
8	8	homestead property tax liability equal to the amount by which the
9	9	property tax liability increases by more than 10% from the prior year.
10	10	Requires the county auditor to apply the credit against an individual's
11	11	homestead property tax liability without the need to file an application.
12	12	Provides that the minimum property tax liability for an individual's
13	13	homestead is an amount equal to the result of: (1) the property tax
14	14	liability first due and payable on the homestead for the immediately
15	15	preceding calendar year; multiplied by (2) 0.9. Increases the: (1)
16	16	amount of certain personal exemptions from $1,000 to $2,500 for
17	17	individual taxpayers who satisfy certain income criteria; and (2)
18	18	amount of property taxes paid by an individual taxpayer on the
19	19	individual's principal place of residence from $2,500 to $3,500; that
20	20	may be subtracted from an individual's federal adjusted gross income.
21	21	Increases the renter's deduction to $4,000 for state income tax
22	22	purposes.
23	23	Effective: July 1, 2023; January 1, 2024.
24	24	Qaddoura
25	25	January 12, 2023, read first time and referred to Committee on Tax and Fiscal Policy.
26	26	2023 IN 359—LS 6854/DI 129 Introduced
27	27	First Regular Session of the 123rd General Assembly (2023)
28	28	PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
29	29	Constitution) is being amended, the text of the existing provision will appear in this style type,
30	30	additions will appear in this style type, and deletions will appear in this style type.
31	31	Additions: Whenever a new statutory provision is being enacted (or a new constitutional
32	32	provision adopted), the text of the new provision will appear in this style type. Also, the
33	33	word NEW will appear in that style type in the introductory clause of each SECTION that adds
34	34	a new provision to the Indiana Code or the Indiana Constitution.
35	35	Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
36	36	between statutes enacted by the 2022 Regular Session of the General Assembly.
37	37	SENATE BILL No. 359
38	38	A BILL FOR AN ACT to amend the Indiana Code concerning
39	39	taxation.
40	40	Be it enacted by the General Assembly of the State of Indiana:
41	41	1 SECTION 1. IC 6-1.1-49 IS ADDED TO THE INDIANA CODE
42	42	2 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
43	43	3 JULY 1, 2023]:
44	44	4 Chapter 49. Homestead Property Tax Liability
45	45	5 Sec. 1. As used in this chapter, "homestead" refers to a
46	46	6 homestead that has been granted a standard deduction under
47	47	7 IC 6-1.1-12-37.
48	48	8 Sec. 2. As used in this chapter, "homestead property tax
49	49	9 liability" refers to liability for property taxes that:
50	50	10 (1) is imposed on the assessment of a homestead after the
51	51	11 application of all deductions and credits for which the
52	52	12 homestead is eligible; but
53	53	13 (2) does not include the portion of the property tax liability
54	54	14 that is attributable to a school operating referendum tax levy
55	55	15 approved under IC 20-46-1 or a school safety referendum tax
56	56	16 levy approved under IC 20-46-9.
57	57	17 The term does not include any interest or penalty imposed under
58	58	2023 IN 359—LS 6854/DI 129 2
59	59	1 this article.
60	60	2 Sec. 3. (a) Beginning with property taxes first due and payable
61	61	3 in 2024 and subject to section 4 of this chapter, if an individual's
62	62	4 homestead property tax liability increases by more than ten
63	63	5 percent (10%) compared to the preceding year, the individual is
64	64	6 entitled to a credit against the individual's homestead property tax
65	65	7 liability equal to:
66	66	8 (1) the property tax liability first due and payable on the
67	67	9 homestead for the calendar year; minus
68	68	10 (2) the result of:
69	69	11 (A) the property tax liability first due and payable on the
70	70	12 homestead for the immediately preceding calendar year,
71	71	13 after the application of the credit granted under this
72	72	14 section for that year; multiplied by
73	73	15 (B) one and one-tenth (1.1).
74	74	16 However, property tax liability imposed on any significant
75	75	17 improvements or additions to the homestead property after the
76	76	18 assessment date for which property tax liability described in
77	77	19 subdivision (2) was imposed shall not be considered in determining
78	78	20 the credit granted under this section in the current calendar year.
79	79	21 (b) Beginning with property taxes first due and payable in 2024
80	80	22 the minimum property tax liability for an individual's homestead
81	81	23 is an amount equal to the result of:
82	82	24 (1) the property tax liability first due and payable on the
83	83	25 homestead for the immediately preceding calendar year;
84	84	26 multiplied by
85	85	27 (2) nine-tenths (0.9).
86	86	28 However, the minimum property tax liability shall be adjusted to
87	87	29 reflect a physical change to the homestead that results in a
88	88	30 decreased assessment of the homestead property after the
89	89	31 assessment date for which property tax liability described in
90	90	32 subdivision (1) was imposed.
91	91	33 Sec. 4. The credit provided under this chapter does not apply to
92	92	34 an individual who is delinquent in the payment of any property
93	93	35 taxes.
94	94	36 Sec. 5. An individual is not required to file an application for the
95	95	37 credit under this chapter. The county auditor shall:
96	96	38 (1) identify homesteads in the county that are eligible for the
97	97	39 credit under this chapter; and
98	98	40 (2) apply the credit under this chapter to the property tax
99	99	41 liability on the identified homestead.
100	100	42 SECTION 2. IC 6-3-1-3.5, AS AMENDED BY P.L.180-2022(ss),
101	101	2023 IN 359—LS 6854/DI 129 3
102	102	1 SECTION 8, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
103	103	2 JANUARY 1, 2024]: Sec. 3.5. When used in this article, the term
104	104	3 "adjusted gross income" shall mean the following:
105	105	4 (a) In the case of all individuals, "adjusted gross income" (as
106	106	5 defined in Section 62 of the Internal Revenue Code), modified as
107	107	6 follows:
108	108	7 (1) Subtract income that is exempt from taxation under this article
109	109	8 by the Constitution and statutes of the United States.
110	110	9 (2) Except as provided in subsection (c), add an amount equal to
111	111	10 any deduction or deductions allowed or allowable pursuant to
112	112	11 Section 62 of the Internal Revenue Code for taxes based on or
113	113	12 measured by income and levied at the state level by any state of
114	114	13 the United States.
115	115	14 (3) Subtract the following amounts:
116	116	15 (A) This clause applies to an individual with an adjusted
117	117	16 gross income (as defined in Section 62 of the Internal
118	118	17 Revenue Code) of more than two hundred thousand dollars
119	119	18 ($200,000) and to a married couple with an adjusted gross
120	120	19 income (as defined in Section 62 of the Internal Revenue
121	121	20 Code) of more than four hundred thousand dollars
122	122	21 ($400,000). One thousand dollars ($1,000), or in the case of a
123	123	22 joint return filed by a husband and wife, subtract for each
124	124	23 spouse one thousand dollars ($1,000).
125	125	24 (B) This clause applies to an individual with an adjusted
126	126	25 gross income (as defined in Section 62 of the Internal
127	127	26 Revenue Code) of not more than two hundred thousand
128	128	27 dollars ($200,000) and to a married couple with an
129	129	28 adjusted gross income (as defined in Section 62 of the
130	130	29 Internal Revenue Code) of not more than four hundred
131	131	30 thousand dollars ($400,000). Two thousand five hundred
132	132	31 dollars ($2,500), or in the case of a joint return filed by a
133	133	32 husband and wife, subtract for each spouse two thousand
134	134	33 five hundred dollars ($2,500).
135	135	34 (4) Subtract the following amounts:
136	136	35 (A) This clause applies to an individual with an adjusted
137	137	36 gross income (as defined in Section 62 of the Internal
138	138	37 Revenue Code) of more than two hundred thousand dollars
139	139	38 ($200,000) and to a married couple with an adjusted gross
140	140	39 income (as defined in Section 62 of the Internal Revenue
141	141	40 Code) of more than four hundred thousand dollars
142	142	41 ($400,000). One thousand dollars ($1,000) for:
143	143	42 (A) (i) each of the exemptions provided by Section 151(c) of
144	144	2023 IN 359—LS 6854/DI 129 4
145	145	1 the Internal Revenue Code (as effective January 1, 2017);
146	146	2 (B) (ii) each additional amount allowable under Section
147	147	3 63(f) of the Internal Revenue Code; and
148	148	4 (C) (iii) the spouse of the taxpayer if a separate return is
149	149	5 made by the taxpayer and if the spouse, for the calendar year
150	150	6 in which the taxable year of the taxpayer begins, has no
151	151	7 gross income and is not the dependent of another taxpayer.
152	152	8 (B) This clause applies to an individual with an adjusted
153	153	9 gross income (as defined in Section 62 of the Internal
154	154	10 Revenue Code) of not more than two hundred thousand
155	155	11 dollars ($200,000) and to a married couple with an
156	156	12 adjusted gross income (as defined in Section 62 of the
157	157	13 Internal Revenue Code) of not more than four hundred
158	158	14 thousand dollars ($400,000). Two thousand five hundred
159	159	15 dollars ($2,500), for:
160	160	16 (i) each of the exemptions provided by Section 151(c) of
161	161	17 the Internal Revenue Code (as effective January 1,
162	162	18 2017);
163	163	19 (ii) each additional amount allowable under Section 63(f)
164	164	20 of the Internal Revenue Code; and
165	165	21 (iii) the spouse of the taxpayer if a separate return is
166	166	22 made by the taxpayer and if the spouse, for the calendar
167	167	23 year in which the taxable year of the taxpayer begins,
168	168	24 has no gross income and is not the dependent of another
169	169	25 taxpayer.
170	170	26 (5) Subtract:
171	171	27 (A) One thousand five hundred dollars ($1,500) for each of the
172	172	28 exemptions allowed under Section 151(c)(1)(B) of the Internal
173	173	29 Revenue Code (as effective January 1, 2004).
174	174	30 (B) One thousand five hundred dollars ($1,500) for each
175	175	31 exemption allowed under Section 151(c) of the Internal
176	176	32 Revenue Code (as effective January 1, 2017) for an individual:
177	177	33 (i) who is less than nineteen (19) years of age or is a
178	178	34 full-time student who is less than twenty-four (24) years of
179	179	35 age;
180	180	36 (ii) for whom the taxpayer is the legal guardian; and
181	181	37 (iii) for whom the taxpayer does not claim an exemption
182	182	38 under clause (A).
183	183	39 (C) Five hundred dollars ($500) for each additional amount
184	184	40 allowable under Section 63(f)(1) of the Internal Revenue Code
185	185	41 if the federal adjusted gross income of the taxpayer, or the
186	186	42 taxpayer and the taxpayer's spouse in the case of a joint return,
187	187	2023 IN 359—LS 6854/DI 129 5
188	188	1 is less than forty thousand dollars ($40,000). In the case of a
189	189	2 married individual filing a separate return, the qualifying
190	190	3 income amount in this clause is equal to twenty thousand
191	191	4 dollars ($20,000).
192	192	5 (D) Three thousand dollars ($3,000) for each exemption
193	193	6 allowed under Section 151(c) of the Internal Revenue Code (as
194	194	7 effective January 1, 2017) for an individual who is:
195	195	8 (i) an adopted child of the taxpayer; and
196	196	9 (ii) less than nineteen (19) years of age or is a full-time
197	197	10 student who is less than twenty-four (24) years of age.
198	198	11 This amount is in addition to any amount subtracted under
199	199	12 clause (A) or (B).
200	200	13 This amount is in addition to the amount subtracted under
201	201	14 subdivision (4).
202	202	15 (6) Subtract any amounts included in federal adjusted gross
203	203	16 income under Section 111 of the Internal Revenue Code as a
204	204	17 recovery of items previously deducted as an itemized deduction
205	205	18 from adjusted gross income.
206	206	19 (7) Subtract any amounts included in federal adjusted gross
207	207	20 income under the Internal Revenue Code which amounts were
208	208	21 received by the individual as supplemental railroad retirement
209	209	22 annuities under 45 U.S.C. 231 and which are not deductible under
210	210	23 subdivision (1).
211	211	24 (8) Subtract an amount equal to the amount of federal Social
212	212	25 Security and Railroad Retirement benefits included in a taxpayer's
213	213	26 federal gross income by Section 86 of the Internal Revenue Code.
214	214	27 (9) In the case of a nonresident taxpayer or a resident taxpayer
215	215	28 residing in Indiana for a period of less than the taxpayer's entire
216	216	29 taxable year, the total amount of the deductions allowed pursuant
217	217	30 to subdivisions (3), (4), and (5) shall be reduced to an amount
218	218	31 which bears the same ratio to the total as the taxpayer's income
219	219	32 taxable in Indiana bears to the taxpayer's total income.
220	220	33 (10) In the case of an individual who is a recipient of assistance
221	221	34 under IC 12-10-6-1, IC 12-10-6-2.1, IC 12-15-2-2, or IC 12-15-7,
222	222	35 subtract an amount equal to that portion of the individual's
223	223	36 adjusted gross income with respect to which the individual is not
224	224	37 allowed under federal law to retain an amount to pay state and
225	225	38 local income taxes.
226	226	39 (11) In the case of an eligible individual, subtract the amount of
227	227	40 a Holocaust victim's settlement payment included in the
228	228	41 individual's federal adjusted gross income.
229	229	42 (12) Subtract an amount equal to the portion of any premiums
230	230	2023 IN 359—LS 6854/DI 129 6
231	231	1 paid during the taxable year by the taxpayer for a qualified long
232	232	2 term care policy (as defined in IC 12-15-39.6-5) for the taxpayer
233	233	3 or the taxpayer's spouse if the taxpayer and the taxpayer's spouse
234	234	4 file a joint income tax return or the taxpayer is otherwise entitled
235	235	5 to a deduction under this subdivision for the taxpayer's spouse, or
236	236	6 both.
237	237	7 (13) Subtract an amount equal to the lesser of:
238	238	8 (A) two three thousand five hundred dollars ($2,500),
239	239	9 ($3,500) or one thousand two seven hundred fifty dollars
240	240	10 ($1,250) ($1,750) in the case of a married individual filing a
241	241	11 separate return; or
242	242	12 (B) the amount of property taxes that are paid during the
243	243	13 taxable year in Indiana by the individual on the individual's
244	244	14 principal place of residence.
245	245	15 (14) Subtract an amount equal to the amount of a September 11
246	246	16 terrorist attack settlement payment included in the individual's
247	247	17 federal adjusted gross income.
248	248	18 (15) Add or subtract the amount necessary to make the adjusted
249	249	19 gross income of any taxpayer that owns property for which bonus
250	250	20 depreciation was allowed in the current taxable year or in an
251	251	21 earlier taxable year equal to the amount of adjusted gross income
252	252	22 that would have been computed had an election not been made
253	253	23 under Section 168(k) of the Internal Revenue Code to apply bonus
254	254	24 depreciation to the property in the year that it was placed in
255	255	25 service.
256	256	26 (16) Add an amount equal to any deduction allowed under
257	257	27 Section 172 of the Internal Revenue Code (concerning net
258	258	28 operating losses).
259	259	29 (17) Add or subtract the amount necessary to make the adjusted
260	260	30 gross income of any taxpayer that placed Section 179 property (as
261	261	31 defined in Section 179 of the Internal Revenue Code) in service
262	262	32 in the current taxable year or in an earlier taxable year equal to
263	263	33 the amount of adjusted gross income that would have been
264	264	34 computed had an election for federal income tax purposes not
265	265	35 been made for the year in which the property was placed in
266	266	36 service to take deductions under Section 179 of the Internal
267	267	37 Revenue Code in a total amount exceeding the sum of:
268	268	38 (A) twenty-five thousand dollars ($25,000) to the extent
269	269	39 deductions under Section 179 of the Internal Revenue Code
270	270	40 were not elected as provided in clause (B); and
271	271	41 (B) for taxable years beginning after December 31, 2017, the
272	272	42 deductions elected under Section 179 of the Internal Revenue
273	273	2023 IN 359—LS 6854/DI 129 7
274	274	1 Code on property acquired in an exchange if:
275	275	2 (i) the exchange would have been eligible for
276	276	3 nonrecognition of gain or loss under Section 1031 of the
277	277	4 Internal Revenue Code in effect on January 1, 2017;
278	278	5 (ii) the exchange is not eligible for nonrecognition of gain or
279	279	6 loss under Section 1031 of the Internal Revenue Code; and
280	280	7 (iii) the taxpayer made an election to take deductions under
281	281	8 Section 179 of the Internal Revenue Code with regard to the
282	282	9 acquired property in the year that the property was placed
283	283	10 into service.
284	284	11 The amount of deductions allowable for an item of property
285	285	12 under this clause may not exceed the amount of adjusted gross
286	286	13 income realized on the property that would have been deferred
287	287	14 under the Internal Revenue Code in effect on January 1, 2017.
288	288	15 (18) Subtract an amount equal to the amount of the taxpayer's
289	289	16 qualified military income that was not excluded from the
290	290	17 taxpayer's gross income for federal income tax purposes under
291	291	18 Section 112 of the Internal Revenue Code.
292	292	19 (19) Subtract income that is:
293	293	20 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
294	294	21 derived from patents); and
295	295	22 (B) included in the individual's federal adjusted gross income
296	296	23 under the Internal Revenue Code.
297	297	24 (20) Add an amount equal to any income not included in gross
298	298	25 income as a result of the deferral of income arising from business
299	299	26 indebtedness discharged in connection with the reacquisition after
300	300	27 December 31, 2008, and before January 1, 2011, of an applicable
301	301	28 debt instrument, as provided in Section 108(i) of the Internal
302	302	29 Revenue Code. Subtract the amount necessary from the adjusted
303	303	30 gross income of any taxpayer that added an amount to adjusted
304	304	31 gross income in a previous year to offset the amount included in
305	305	32 federal gross income as a result of the deferral of income arising
306	306	33 from business indebtedness discharged in connection with the
307	307	34 reacquisition after December 31, 2008, and before January 1,
308	308	35 2011, of an applicable debt instrument, as provided in Section
309	309	36 108(i) of the Internal Revenue Code.
310	310	37 (21) Add the amount excluded from federal gross income under
311	311	38 Section 103 of the Internal Revenue Code for interest received on
312	312	39 an obligation of a state other than Indiana, or a political
313	313	40 subdivision of such a state, that is acquired by the taxpayer after
314	314	41 December 31, 2011.
315	315	42 (22) Subtract an amount as described in Section 1341(a)(2) of the
316	316	2023 IN 359—LS 6854/DI 129 8
317	317	1 Internal Revenue Code to the extent, if any, that the amount was
318	318	2 previously included in the taxpayer's adjusted gross income for a
319	319	3 prior taxable year.
320	320	4 (23) For taxable years beginning after December 25, 2016, add an
321	321	5 amount equal to the deduction for deferred foreign income that
322	322	6 was claimed by the taxpayer for the taxable year under Section
323	323	7 965(c) of the Internal Revenue Code.
324	324	8 (24) Subtract any interest expense paid or accrued in the current
325	325	9 taxable year but not deducted as a result of the limitation imposed
326	326	10 under Section 163(j)(1) of the Internal Revenue Code. Add any
327	327	11 interest expense paid or accrued in a previous taxable year but
328	328	12 allowed as a deduction under Section 163 of the Internal Revenue
329	329	13 Code in the current taxable year. For purposes of this subdivision,
330	330	14 an interest expense is considered paid or accrued only in the first
331	331	15 taxable year the deduction would have been allowable under
332	332	16 Section 163 of the Internal Revenue Code if the limitation under
333	333	17 Section 163(j)(1) of the Internal Revenue Code did not exist.
334	334	18 (25) Subtract the amount that would have been excluded from
335	335	19 gross income but for the enactment of Section 118(b)(2) of the
336	336	20 Internal Revenue Code for taxable years ending after December
337	337	21 22, 2017.
338	338	22 (26) For taxable years beginning after December 31, 2019, and
339	339	23 before January 1, 2021, add an amount of the deduction claimed
340	340	24 under Section 62(a)(22) of the Internal Revenue Code.
341	341	25 (27) For taxable years beginning after December 31, 2019, for
342	342	26 payments made by an employer under an education assistance
343	343	27 program after March 27, 2020:
344	344	28 (A) add the amount of payments by an employer that are
345	345	29 excluded from the taxpayer's federal gross income under
346	346	30 Section 127(c)(1)(B) of the Internal Revenue Code; and
347	347	31 (B) deduct the interest allowable under Section 221 of the
348	348	32 Internal Revenue Code, if the disallowance under Section
349	349	33 221(e)(1) of the Internal Revenue Code did not apply to the
350	350	34 payments described in clause (A). For purposes of applying
351	351	35 Section 221(b) of the Internal Revenue Code to the amount
352	352	36 allowable under this clause, the amount under clause (A) shall
353	353	37 not be added to adjusted gross income.
354	354	38 (28) Add an amount equal to the remainder of:
355	355	39 (A) the amount allowable as a deduction under Section 274(n)
356	356	40 of the Internal Revenue Code; minus
357	357	41 (B) the amount otherwise allowable as a deduction under
358	358	42 Section 274(n) of the Internal Revenue Code, if Section
359	359	2023 IN 359—LS 6854/DI 129 9
360	360	1 274(n)(2)(D) of the Internal Revenue Code was not in effect
361	361	2 for amounts paid or incurred after December 31, 2020.
362	362	3 (29) For taxable years beginning after December 31, 2017, and
363	363	4 before January 1, 2021, add an amount equal to the excess
364	364	5 business loss of the taxpayer as defined in Section 461(l)(3) of the
365	365	6 Internal Revenue Code. In addition:
366	366	7 (A) If a taxpayer has an excess business loss under this
367	367	8 subdivision and also has modifications under subdivisions (15)
368	368	9 and (17) for property placed in service during the taxable year,
369	369	10 the taxpayer shall treat a portion of the taxable year
370	370	11 modifications for that property as occurring in the taxable year
371	371	12 the property is placed in service and a portion of the
372	372	13 modifications as occurring in the immediately following
373	373	14 taxable year.
374	374	15 (B) The portion of the modifications under subdivisions (15)
375	375	16 and (17) for property placed in service during the taxable year
376	376	17 treated as occurring in the taxable year in which the property
377	377	18 is placed in service equals:
378	378	19 (i) the modification for the property otherwise determined
379	379	20 under this section; minus
380	380	21 (ii) the excess business loss disallowed under this
381	381	22 subdivision;
382	382	23 but not less than zero (0).
383	383	24 (C) The portion of the modifications under subdivisions (15)
384	384	25 and (17) for property placed in service during the taxable year
385	385	26 treated as occurring in the taxable year immediately following
386	386	27 the taxable year in which the property is placed in service
387	387	28 equals the modification for the property otherwise determined
388	388	29 under this section minus the amount in clause (B).
389	389	30 (D) Any reallocation of modifications between taxable years
390	390	31 under clauses (B) and (C) shall be first allocated to the
391	391	32 modification under subdivision (15), then to the modification
392	392	33 under subdivision (17).
393	393	34 (30) Add an amount equal to the amount excluded from federal
394	394	35 gross income under Section 108(f)(5) of the Internal Revenue
395	395	36 Code. For purposes of this subdivision:
396	396	37 (A) if an amount excluded under Section 108(f)(5) of the
397	397	38 Internal Revenue Code would be excludible under Section
398	398	39 108(a)(1)(B) of the Internal Revenue Code, the exclusion
399	399	40 under Section 108(a)(1)(B) of the Internal Revenue Code shall
400	400	41 take precedence; and
401	401	42 (B) if an amount would have been excludible under Section
402	402	2023 IN 359—LS 6854/DI 129 10
403	403	1 108(f)(5) of the Internal Revenue Code as in effect on January
404	404	2 1, 2020, the amount is not required to be added back under this
405	405	3 subdivision.
406	406	4 (31) For taxable years ending after March 12, 2020, subtract an
407	407	5 amount equal to the deduction disallowed pursuant to:
408	408	6 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
409	409	7 as modified by Sections 206 and 207 of the Taxpayer Certainty
410	410	8 and Disaster Relief Tax Act (Division EE of Public Law
411	411	9 116-260); and
412	412	10 (B) Section 3134(e) of the Internal Revenue Code.
413	413	11 (32) Subtract the amount of an annual grant amount distributed to
414	414	12 a taxpayer's Indiana education scholarship account under
415	415	13 IC 20-51.4-4-2 that is used for a qualified expense (as defined in
416	416	14 IC 20-51.4-2-9) or to an Indiana enrichment scholarship account
417	417	15 under IC 20-52 that is used for qualified expenses (as defined in
418	418	16 IC 20-52-2-6), to the extent the distribution used for the qualified
419	419	17 expense is included in the taxpayer's federal adjusted gross
420	420	18 income under the Internal Revenue Code.
421	421	19 (33) For taxable years beginning after December 31, 2019, and
422	422	20 before January 1, 2021, add an amount equal to the amount of
423	423	21 unemployment compensation excluded from federal gross income
424	424	22 under Section 85(c) of the Internal Revenue Code.
425	425	23 (34) For taxable years beginning after December 31, 2022,
426	426	24 subtract an amount equal to the deduction disallowed under
427	427	25 Section 280C(h) of the Internal Revenue Code.
428	428	26 (35) Subtract any other amounts the taxpayer is entitled to deduct
429	429	27 under IC 6-3-2.
430	430	28 (b) In the case of corporations, the same as "taxable income" (as
431	431	29 defined in Section 63 of the Internal Revenue Code) adjusted as
432	432	30 follows:
433	433	31 (1) Subtract income that is exempt from taxation under this article
434	434	32 by the Constitution and statutes of the United States.
435	435	33 (2) Add an amount equal to any deduction or deductions allowed
436	436	34 or allowable pursuant to Section 170 of the Internal Revenue
437	437	35 Code (concerning charitable contributions).
438	438	36 (3) Except as provided in subsection (c), add an amount equal to
439	439	37 any deduction or deductions allowed or allowable pursuant to
440	440	38 Section 63 of the Internal Revenue Code for taxes based on or
441	441	39 measured by income and levied at the state level by any state of
442	442	40 the United States.
443	443	41 (4) Subtract an amount equal to the amount included in the
444	444	42 corporation's taxable income under Section 78 of the Internal
445	445	2023 IN 359—LS 6854/DI 129 11
446	446	1 Revenue Code (concerning foreign tax credits).
447	447	2 (5) Add or subtract the amount necessary to make the adjusted
448	448	3 gross income of any taxpayer that owns property for which bonus
449	449	4 depreciation was allowed in the current taxable year or in an
450	450	5 earlier taxable year equal to the amount of adjusted gross income
451	451	6 that would have been computed had an election not been made
452	452	7 under Section 168(k) of the Internal Revenue Code to apply bonus
453	453	8 depreciation to the property in the year that it was placed in
454	454	9 service.
455	455	10 (6) Add an amount equal to any deduction allowed under Section
456	456	11 172 of the Internal Revenue Code (concerning net operating
457	457	12 losses).
458	458	13 (7) Add or subtract the amount necessary to make the adjusted
459	459	14 gross income of any taxpayer that placed Section 179 property (as
460	460	15 defined in Section 179 of the Internal Revenue Code) in service
461	461	16 in the current taxable year or in an earlier taxable year equal to
462	462	17 the amount of adjusted gross income that would have been
463	463	18 computed had an election for federal income tax purposes not
464	464	19 been made for the year in which the property was placed in
465	465	20 service to take deductions under Section 179 of the Internal
466	466	21 Revenue Code in a total amount exceeding the sum of:
467	467	22 (A) twenty-five thousand dollars ($25,000) to the extent
468	468	23 deductions under Section 179 of the Internal Revenue Code
469	469	24 were not elected as provided in clause (B); and
470	470	25 (B) for taxable years beginning after December 31, 2017, the
471	471	26 deductions elected under Section 179 of the Internal Revenue
472	472	27 Code on property acquired in an exchange if:
473	473	28 (i) the exchange would have been eligible for
474	474	29 nonrecognition of gain or loss under Section 1031 of the
475	475	30 Internal Revenue Code in effect on January 1, 2017;
476	476	31 (ii) the exchange is not eligible for nonrecognition of gain or
477	477	32 loss under Section 1031 of the Internal Revenue Code; and
478	478	33 (iii) the taxpayer made an election to take deductions under
479	479	34 Section 179 of the Internal Revenue Code with regard to the
480	480	35 acquired property in the year that the property was placed
481	481	36 into service.
482	482	37 The amount of deductions allowable for an item of property
483	483	38 under this clause may not exceed the amount of adjusted gross
484	484	39 income realized on the property that would have been deferred
485	485	40 under the Internal Revenue Code in effect on January 1, 2017.
486	486	41 (8) Add to the extent required by IC 6-3-2-20:
487	487	42 (A) the amount of intangible expenses (as defined in
488	488	2023 IN 359—LS 6854/DI 129 12
489	489	1 IC 6-3-2-20) for the taxable year that reduced the corporation's
490	490	2 taxable income (as defined in Section 63 of the Internal
491	491	3 Revenue Code) for federal income tax purposes; and
492	492	4 (B) any directly related interest expenses (as defined in
493	493	5 IC 6-3-2-20) that reduced the corporation's adjusted gross
494	494	6 income (determined without regard to this subdivision). For
495	495	7 purposes of this clause, any directly related interest expense
496	496	8 that constitutes business interest within the meaning of Section
497	497	9 163(j) of the Internal Revenue Code shall be considered to
498	498	10 have reduced the taxpayer's federal taxable income only in the
499	499	11 first taxable year in which the deduction otherwise would have
500	500	12 been allowable under Section 163 of the Internal Revenue
501	501	13 Code if the limitation under Section 163(j)(1) of the Internal
502	502	14 Revenue Code did not exist.
503	503	15 (9) Add an amount equal to any deduction for dividends paid (as
504	504	16 defined in Section 561 of the Internal Revenue Code) to
505	505	17 shareholders of a captive real estate investment trust (as defined
506	506	18 in section 34.5 of this chapter).
507	507	19 (10) Subtract income that is:
508	508	20 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
509	509	21 derived from patents); and
510	510	22 (B) included in the corporation's taxable income under the
511	511	23 Internal Revenue Code.
512	512	24 (11) Add an amount equal to any income not included in gross
513	513	25 income as a result of the deferral of income arising from business
514	514	26 indebtedness discharged in connection with the reacquisition after
515	515	27 December 31, 2008, and before January 1, 2011, of an applicable
516	516	28 debt instrument, as provided in Section 108(i) of the Internal
517	517	29 Revenue Code. Subtract from the adjusted gross income of any
518	518	30 taxpayer that added an amount to adjusted gross income in a
519	519	31 previous year the amount necessary to offset the amount included
520	520	32 in federal gross income as a result of the deferral of income
521	521	33 arising from business indebtedness discharged in connection with
522	522	34 the reacquisition after December 31, 2008, and before January 1,
523	523	35 2011, of an applicable debt instrument, as provided in Section
524	524	36 108(i) of the Internal Revenue Code.
525	525	37 (12) Add the amount excluded from federal gross income under
526	526	38 Section 103 of the Internal Revenue Code for interest received on
527	527	39 an obligation of a state other than Indiana, or a political
528	528	40 subdivision of such a state, that is acquired by the taxpayer after
529	529	41 December 31, 2011.
530	530	42 (13) For taxable years beginning after December 25, 2016:
531	531	2023 IN 359—LS 6854/DI 129 13
532	532	1 (A) for a corporation other than a real estate investment trust,
533	533	2 add:
534	534	3 (i) an amount equal to the amount reported by the taxpayer
535	535	4 on IRC 965 Transition Tax Statement, line 1; or
536	536	5 (ii) if the taxpayer deducted an amount under Section 965(c)
537	537	6 of the Internal Revenue Code in determining the taxpayer's
538	538	7 taxable income for purposes of the federal income tax, the
539	539	8 amount deducted under Section 965(c) of the Internal
540	540	9 Revenue Code; and
541	541	10 (B) for a real estate investment trust, add an amount equal to
542	542	11 the deduction for deferred foreign income that was claimed by
543	543	12 the taxpayer for the taxable year under Section 965(c) of the
544	544	13 Internal Revenue Code, but only to the extent that the taxpayer
545	545	14 included income pursuant to Section 965 of the Internal
546	546	15 Revenue Code in its taxable income for federal income tax
547	547	16 purposes or is required to add back dividends paid under
548	548	17 subdivision (9).
549	549	18 (14) Add an amount equal to the deduction that was claimed by
550	550	19 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
551	551	20 Internal Revenue Code (attributable to global intangible
552	552	21 low-taxed income). The taxpayer shall separately specify the
553	553	22 amount of the reduction under Section 250(a)(1)(B)(i) of the
554	554	23 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
555	555	24 Internal Revenue Code.
556	556	25 (15) Subtract any interest expense paid or accrued in the current
557	557	26 taxable year but not deducted as a result of the limitation imposed
558	558	27 under Section 163(j)(1) of the Internal Revenue Code. Add any
559	559	28 interest expense paid or accrued in a previous taxable year but
560	560	29 allowed as a deduction under Section 163 of the Internal Revenue
561	561	30 Code in the current taxable year. For purposes of this subdivision,
562	562	31 an interest expense is considered paid or accrued only in the first
563	563	32 taxable year the deduction would have been allowable under
564	564	33 Section 163 of the Internal Revenue Code if the limitation under
565	565	34 Section 163(j)(1) of the Internal Revenue Code did not exist.
566	566	35 (16) Subtract the amount that would have been excluded from
567	567	36 gross income but for the enactment of Section 118(b)(2) of the
568	568	37 Internal Revenue Code for taxable years ending after December
569	569	38 22, 2017.
570	570	39 (17) Add an amount equal to the remainder of:
571	571	40 (A) the amount allowable as a deduction under Section 274(n)
572	572	41 of the Internal Revenue Code; minus
573	573	42 (B) the amount otherwise allowable as a deduction under
574	574	2023 IN 359—LS 6854/DI 129 14
575	575	1 Section 274(n) of the Internal Revenue Code, if Section
576	576	2 274(n)(2)(D) of the Internal Revenue Code was not in effect
577	577	3 for amounts paid or incurred after December 31, 2020.
578	578	4 (18) For taxable years ending after March 12, 2020, subtract an
579	579	5 amount equal to the deduction disallowed pursuant to:
580	580	6 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
581	581	7 as modified by Sections 206 and 207 of the Taxpayer Certainty
582	582	8 and Disaster Relief Tax Act (Division EE of Public Law
583	583	9 116-260); and
584	584	10 (B) Section 3134(e) of the Internal Revenue Code.
585	585	11 (19) For taxable years beginning after December 31, 2022,
586	586	12 subtract an amount equal to the deduction disallowed under
587	587	13 Section 280C(h) of the Internal Revenue Code.
588	588	14 (20) Add or subtract any other amounts the taxpayer is:
589	589	15 (A) required to add or subtract; or
590	590	16 (B) entitled to deduct;
591	591	17 under IC 6-3-2.
592	592	18 (c) The following apply to taxable years beginning after December
593	593	19 31, 2018, for purposes of the add back of any deduction allowed on the
594	594	20 taxpayer's federal income tax return for wagering taxes, as provided in
595	595	21 subsection (a)(2) if the taxpayer is an individual or subsection (b)(3) if
596	596	22 the taxpayer is a corporation:
597	597	23 (1) For taxable years beginning after December 31, 2018, and
598	598	24 before January 1, 2020, a taxpayer is required to add back under
599	599	25 this section eighty-seven and five-tenths percent (87.5%) of any
600	600	26 deduction allowed on the taxpayer's federal income tax return for
601	601	27 wagering taxes.
602	602	28 (2) For taxable years beginning after December 31, 2019, and
603	603	29 before January 1, 2021, a taxpayer is required to add back under
604	604	30 this section seventy-five percent (75%) of any deduction allowed
605	605	31 on the taxpayer's federal income tax return for wagering taxes.
606	606	32 (3) For taxable years beginning after December 31, 2020, and
607	607	33 before January 1, 2022, a taxpayer is required to add back under
608	608	34 this section sixty-two and five-tenths percent (62.5%) of any
609	609	35 deduction allowed on the taxpayer's federal income tax return for
610	610	36 wagering taxes.
611	611	37 (4) For taxable years beginning after December 31, 2021, and
612	612	38 before January 1, 2023, a taxpayer is required to add back under
613	613	39 this section fifty percent (50%) of any deduction allowed on the
614	614	40 taxpayer's federal income tax return for wagering taxes.
615	615	41 (5) For taxable years beginning after December 31, 2022, and
616	616	42 before January 1, 2024, a taxpayer is required to add back under
617	617	2023 IN 359—LS 6854/DI 129 15
618	618	1 this section thirty-seven and five-tenths percent (37.5%) of any
619	619	2 deduction allowed on the taxpayer's federal income tax return for
620	620	3 wagering taxes.
621	621	4 (6) For taxable years beginning after December 31, 2023, and
622	622	5 before January 1, 2025, a taxpayer is required to add back under
623	623	6 this section twenty-five percent (25%) of any deduction allowed
624	624	7 on the taxpayer's federal income tax return for wagering taxes.
625	625	8 (7) For taxable years beginning after December 31, 2024, and
626	626	9 before January 1, 2026, a taxpayer is required to add back under
627	627	10 this section twelve and five-tenths percent (12.5%) of any
628	628	11 deduction allowed on the taxpayer's federal income tax return for
629	629	12 wagering taxes.
630	630	13 (8) For taxable years beginning after December 31, 2025, a
631	631	14 taxpayer is not required to add back under this section any amount
632	632	15 of a deduction allowed on the taxpayer's federal income tax return
633	633	16 for wagering taxes.
634	634	17 (d) In the case of life insurance companies (as defined in Section
635	635	18 816(a) of the Internal Revenue Code) that are organized under Indiana
636	636	19 law, the same as "life insurance company taxable income" (as defined
637	637	20 in Section 801 of the Internal Revenue Code), adjusted as follows:
638	638	21 (1) Subtract income that is exempt from taxation under this article
639	639	22 by the Constitution and statutes of the United States.
640	640	23 (2) Add an amount equal to any deduction allowed or allowable
641	641	24 under Section 170 of the Internal Revenue Code (concerning
642	642	25 charitable contributions).
643	643	26 (3) Add an amount equal to a deduction allowed or allowable
644	644	27 under Section 805 or Section 832(c) of the Internal Revenue Code
645	645	28 for taxes based on or measured by income and levied at the state
646	646	29 level by any state.
647	647	30 (4) Subtract an amount equal to the amount included in the
648	648	31 company's taxable income under Section 78 of the Internal
649	649	32 Revenue Code (concerning foreign tax credits).
650	650	33 (5) Add or subtract the amount necessary to make the adjusted
651	651	34 gross income of any taxpayer that owns property for which bonus
652	652	35 depreciation was allowed in the current taxable year or in an
653	653	36 earlier taxable year equal to the amount of adjusted gross income
654	654	37 that would have been computed had an election not been made
655	655	38 under Section 168(k) of the Internal Revenue Code to apply bonus
656	656	39 depreciation to the property in the year that it was placed in
657	657	40 service.
658	658	41 (6) Add an amount equal to any deduction allowed under Section
659	659	42 172 of the Internal Revenue Code (concerning net operating
660	660	2023 IN 359—LS 6854/DI 129 16
661	661	1 losses).
662	662	2 (7) Add or subtract the amount necessary to make the adjusted
663	663	3 gross income of any taxpayer that placed Section 179 property (as
664	664	4 defined in Section 179 of the Internal Revenue Code) in service
665	665	5 in the current taxable year or in an earlier taxable year equal to
666	666	6 the amount of adjusted gross income that would have been
667	667	7 computed had an election for federal income tax purposes not
668	668	8 been made for the year in which the property was placed in
669	669	9 service to take deductions under Section 179 of the Internal
670	670	10 Revenue Code in a total amount exceeding the sum of:
671	671	11 (A) twenty-five thousand dollars ($25,000) to the extent
672	672	12 deductions under Section 179 of the Internal Revenue Code
673	673	13 were not elected as provided in clause (B); and
674	674	14 (B) for taxable years beginning after December 31, 2017, the
675	675	15 deductions elected under Section 179 of the Internal Revenue
676	676	16 Code on property acquired in an exchange if:
677	677	17 (i) the exchange would have been eligible for
678	678	18 nonrecognition of gain or loss under Section 1031 of the
679	679	19 Internal Revenue Code in effect on January 1, 2017;
680	680	20 (ii) the exchange is not eligible for nonrecognition of gain or
681	681	21 loss under Section 1031 of the Internal Revenue Code; and
682	682	22 (iii) the taxpayer made an election to take deductions under
683	683	23 Section 179 of the Internal Revenue Code with regard to the
684	684	24 acquired property in the year that the property was placed
685	685	25 into service.
686	686	26 The amount of deductions allowable for an item of property
687	687	27 under this clause may not exceed the amount of adjusted gross
688	688	28 income realized on the property that would have been deferred
689	689	29 under the Internal Revenue Code in effect on January 1, 2017.
690	690	30 (8) Subtract income that is:
691	691	31 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
692	692	32 derived from patents); and
693	693	33 (B) included in the insurance company's taxable income under
694	694	34 the Internal Revenue Code.
695	695	35 (9) Add an amount equal to any income not included in gross
696	696	36 income as a result of the deferral of income arising from business
697	697	37 indebtedness discharged in connection with the reacquisition after
698	698	38 December 31, 2008, and before January 1, 2011, of an applicable
699	699	39 debt instrument, as provided in Section 108(i) of the Internal
700	700	40 Revenue Code. Subtract from the adjusted gross income of any
701	701	41 taxpayer that added an amount to adjusted gross income in a
702	702	42 previous year the amount necessary to offset the amount included
703	703	2023 IN 359—LS 6854/DI 129 17
704	704	1 in federal gross income as a result of the deferral of income
705	705	2 arising from business indebtedness discharged in connection with
706	706	3 the reacquisition after December 31, 2008, and before January 1,
707	707	4 2011, of an applicable debt instrument, as provided in Section
708	708	5 108(i) of the Internal Revenue Code.
709	709	6 (10) Add an amount equal to any exempt insurance income under
710	710	7 Section 953(e) of the Internal Revenue Code that is active
711	711	8 financing income under Subpart F of Subtitle A, Chapter 1,
712	712	9 Subchapter N of the Internal Revenue Code.
713	713	10 (11) Add the amount excluded from federal gross income under
714	714	11 Section 103 of the Internal Revenue Code for interest received on
715	715	12 an obligation of a state other than Indiana, or a political
716	716	13 subdivision of such a state, that is acquired by the taxpayer after
717	717	14 December 31, 2011.
718	718	15 (12) For taxable years beginning after December 25, 2016, add:
719	719	16 (A) an amount equal to the amount reported by the taxpayer on
720	720	17 IRC 965 Transition Tax Statement, line 1; or
721	721	18 (B) if the taxpayer deducted an amount under Section 965(c)
722	722	19 of the Internal Revenue Code in determining the taxpayer's
723	723	20 taxable income for purposes of the federal income tax, the
724	724	21 amount deducted under Section 965(c) of the Internal Revenue
725	725	22 Code.
726	726	23 (13) Add an amount equal to the deduction that was claimed by
727	727	24 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
728	728	25 Internal Revenue Code (attributable to global intangible
729	729	26 low-taxed income). The taxpayer shall separately specify the
730	730	27 amount of the reduction under Section 250(a)(1)(B)(i) of the
731	731	28 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
732	732	29 Internal Revenue Code.
733	733	30 (14) Subtract any interest expense paid or accrued in the current
734	734	31 taxable year but not deducted as a result of the limitation imposed
735	735	32 under Section 163(j)(1) of the Internal Revenue Code. Add any
736	736	33 interest expense paid or accrued in a previous taxable year but
737	737	34 allowed as a deduction under Section 163 of the Internal Revenue
738	738	35 Code in the current taxable year. For purposes of this subdivision,
739	739	36 an interest expense is considered paid or accrued only in the first
740	740	37 taxable year the deduction would have been allowable under
741	741	38 Section 163 of the Internal Revenue Code if the limitation under
742	742	39 Section 163(j)(1) of the Internal Revenue Code did not exist.
743	743	40 (15) Subtract the amount that would have been excluded from
744	744	41 gross income but for the enactment of Section 118(b)(2) of the
745	745	42 Internal Revenue Code for taxable years ending after December
746	746	2023 IN 359—LS 6854/DI 129 18
747	747	1 22, 2017.
748	748	2 (16) Add an amount equal to the remainder of:
749	749	3 (A) the amount allowable as a deduction under Section 274(n)
750	750	4 of the Internal Revenue Code; minus
751	751	5 (B) the amount otherwise allowable as a deduction under
752	752	6 Section 274(n) of the Internal Revenue Code, if Section
753	753	7 274(n)(2)(D) of the Internal Revenue Code was not in effect
754	754	8 for amounts paid or incurred after December 31, 2020.
755	755	9 (17) For taxable years ending after March 12, 2020, subtract an
756	756	10 amount equal to the deduction disallowed pursuant to:
757	757	11 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
758	758	12 as modified by Sections 206 and 207 of the Taxpayer Certainty
759	759	13 and Disaster Relief Tax Act (Division EE of Public Law
760	760	14 116-260); and
761	761	15 (B) Section 3134(e) of the Internal Revenue Code.
762	762	16 (18) For taxable years beginning after December 31, 2022,
763	763	17 subtract an amount equal to the deduction disallowed under
764	764	18 Section 280C(h) of the Internal Revenue Code.
765	765	19 (19) Add or subtract any other amounts the taxpayer is:
766	766	20 (A) required to add or subtract; or
767	767	21 (B) entitled to deduct;
768	768	22 under IC 6-3-2.
769	769	23 (e) In the case of insurance companies subject to tax under Section
770	770	24 831 of the Internal Revenue Code and organized under Indiana law, the
771	771	25 same as "taxable income" (as defined in Section 832 of the Internal
772	772	26 Revenue Code), adjusted as follows:
773	773	27 (1) Subtract income that is exempt from taxation under this article
774	774	28 by the Constitution and statutes of the United States.
775	775	29 (2) Add an amount equal to any deduction allowed or allowable
776	776	30 under Section 170 of the Internal Revenue Code (concerning
777	777	31 charitable contributions).
778	778	32 (3) Add an amount equal to a deduction allowed or allowable
779	779	33 under Section 805 or Section 832(c) of the Internal Revenue Code
780	780	34 for taxes based on or measured by income and levied at the state
781	781	35 level by any state.
782	782	36 (4) Subtract an amount equal to the amount included in the
783	783	37 company's taxable income under Section 78 of the Internal
784	784	38 Revenue Code (concerning foreign tax credits).
785	785	39 (5) Add or subtract the amount necessary to make the adjusted
786	786	40 gross income of any taxpayer that owns property for which bonus
787	787	41 depreciation was allowed in the current taxable year or in an
788	788	42 earlier taxable year equal to the amount of adjusted gross income
789	789	2023 IN 359—LS 6854/DI 129 19
790	790	1 that would have been computed had an election not been made
791	791	2 under Section 168(k) of the Internal Revenue Code to apply bonus
792	792	3 depreciation to the property in the year that it was placed in
793	793	4 service.
794	794	5 (6) Add an amount equal to any deduction allowed under Section
795	795	6 172 of the Internal Revenue Code (concerning net operating
796	796	7 losses).
797	797	8 (7) Add or subtract the amount necessary to make the adjusted
798	798	9 gross income of any taxpayer that placed Section 179 property (as
799	799	10 defined in Section 179 of the Internal Revenue Code) in service
800	800	11 in the current taxable year or in an earlier taxable year equal to
801	801	12 the amount of adjusted gross income that would have been
802	802	13 computed had an election for federal income tax purposes not
803	803	14 been made for the year in which the property was placed in
804	804	15 service to take deductions under Section 179 of the Internal
805	805	16 Revenue Code in a total amount exceeding the sum of:
806	806	17 (A) twenty-five thousand dollars ($25,000) to the extent
807	807	18 deductions under Section 179 of the Internal Revenue Code
808	808	19 were not elected as provided in clause (B); and
809	809	20 (B) for taxable years beginning after December 31, 2017, the
810	810	21 deductions elected under Section 179 of the Internal Revenue
811	811	22 Code on property acquired in an exchange if:
812	812	23 (i) the exchange would have been eligible for
813	813	24 nonrecognition of gain or loss under Section 1031 of the
814	814	25 Internal Revenue Code in effect on January 1, 2017;
815	815	26 (ii) the exchange is not eligible for nonrecognition of gain or
816	816	27 loss under Section 1031 of the Internal Revenue Code; and
817	817	28 (iii) the taxpayer made an election to take deductions under
818	818	29 Section 179 of the Internal Revenue Code with regard to the
819	819	30 acquired property in the year that the property was placed
820	820	31 into service.
821	821	32 The amount of deductions allowable for an item of property
822	822	33 under this clause may not exceed the amount of adjusted gross
823	823	34 income realized on the property that would have been deferred
824	824	35 under the Internal Revenue Code in effect on January 1, 2017.
825	825	36 (8) Subtract income that is:
826	826	37 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
827	827	38 derived from patents); and
828	828	39 (B) included in the insurance company's taxable income under
829	829	40 the Internal Revenue Code.
830	830	41 (9) Add an amount equal to any income not included in gross
831	831	42 income as a result of the deferral of income arising from business
832	832	2023 IN 359—LS 6854/DI 129 20
833	833	1 indebtedness discharged in connection with the reacquisition after
834	834	2 December 31, 2008, and before January 1, 2011, of an applicable
835	835	3 debt instrument, as provided in Section 108(i) of the Internal
836	836	4 Revenue Code. Subtract from the adjusted gross income of any
837	837	5 taxpayer that added an amount to adjusted gross income in a
838	838	6 previous year the amount necessary to offset the amount included
839	839	7 in federal gross income as a result of the deferral of income
840	840	8 arising from business indebtedness discharged in connection with
841	841	9 the reacquisition after December 31, 2008, and before January 1,
842	842	10 2011, of an applicable debt instrument, as provided in Section
843	843	11 108(i) of the Internal Revenue Code.
844	844	12 (10) Add an amount equal to any exempt insurance income under
845	845	13 Section 953(e) of the Internal Revenue Code that is active
846	846	14 financing income under Subpart F of Subtitle A, Chapter 1,
847	847	15 Subchapter N of the Internal Revenue Code.
848	848	16 (11) Add the amount excluded from federal gross income under
849	849	17 Section 103 of the Internal Revenue Code for interest received on
850	850	18 an obligation of a state other than Indiana, or a political
851	851	19 subdivision of such a state, that is acquired by the taxpayer after
852	852	20 December 31, 2011.
853	853	21 (12) For taxable years beginning after December 25, 2016, add:
854	854	22 (A) an amount equal to the amount reported by the taxpayer on
855	855	23 IRC 965 Transition Tax Statement, line 1; or
856	856	24 (B) if the taxpayer deducted an amount under Section 965(c)
857	857	25 of the Internal Revenue Code in determining the taxpayer's
858	858	26 taxable income for purposes of the federal income tax, the
859	859	27 amount deducted under Section 965(c) of the Internal Revenue
860	860	28 Code.
861	861	29 (13) Add an amount equal to the deduction that was claimed by
862	862	30 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
863	863	31 Internal Revenue Code (attributable to global intangible
864	864	32 low-taxed income). The taxpayer shall separately specify the
865	865	33 amount of the reduction under Section 250(a)(1)(B)(i) of the
866	866	34 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
867	867	35 Internal Revenue Code.
868	868	36 (14) Subtract any interest expense paid or accrued in the current
869	869	37 taxable year but not deducted as a result of the limitation imposed
870	870	38 under Section 163(j)(1) of the Internal Revenue Code. Add any
871	871	39 interest expense paid or accrued in a previous taxable year but
872	872	40 allowed as a deduction under Section 163 of the Internal Revenue
873	873	41 Code in the current taxable year. For purposes of this subdivision,
874	874	42 an interest expense is considered paid or accrued only in the first
875	875	2023 IN 359—LS 6854/DI 129 21
876	876	1 taxable year the deduction would have been allowable under
877	877	2 Section 163 of the Internal Revenue Code if the limitation under
878	878	3 Section 163(j)(1) of the Internal Revenue Code did not exist.
879	879	4 (15) Subtract the amount that would have been excluded from
880	880	5 gross income but for the enactment of Section 118(b)(2) of the
881	881	6 Internal Revenue Code for taxable years ending after December
882	882	7 22, 2017.
883	883	8 (16) Add an amount equal to the remainder of:
884	884	9 (A) the amount allowable as a deduction under Section 274(n)
885	885	10 of the Internal Revenue Code; minus
886	886	11 (B) the amount otherwise allowable as a deduction under
887	887	12 Section 274(n) of the Internal Revenue Code, if Section
888	888	13 274(n)(2)(D) of the Internal Revenue Code was not in effect
889	889	14 for amounts paid or incurred after December 31, 2020.
890	890	15 (17) For taxable years ending after March 12, 2020, subtract an
891	891	16 amount equal to the deduction disallowed pursuant to:
892	892	17 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
893	893	18 as modified by Sections 206 and 207 of the Taxpayer Certainty
894	894	19 and Disaster Relief Tax Act (Division EE of Public Law
895	895	20 116-260); and
896	896	21 (B) Section 3134(e) of the Internal Revenue Code.
897	897	22 (18) For taxable years beginning after December 31, 2022,
898	898	23 subtract an amount equal to the deduction disallowed under
899	899	24 Section 280C(h) of the Internal Revenue Code.
900	900	25 (19) Add or subtract any other amounts the taxpayer is:
901	901	26 (A) required to add or subtract; or
902	902	27 (B) entitled to deduct;
903	903	28 under IC 6-3-2.
904	904	29 (f) In the case of trusts and estates, "taxable income" (as defined for
905	905	30 trusts and estates in Section 641(b) of the Internal Revenue Code)
906	906	31 adjusted as follows:
907	907	32 (1) Subtract income that is exempt from taxation under this article
908	908	33 by the Constitution and statutes of the United States.
909	909	34 (2) Subtract an amount equal to the amount of a September 11
910	910	35 terrorist attack settlement payment included in the federal
911	911	36 adjusted gross income of the estate of a victim of the September
912	912	37 11 terrorist attack or a trust to the extent the trust benefits a victim
913	913	38 of the September 11 terrorist attack.
914	914	39 (3) Add or subtract the amount necessary to make the adjusted
915	915	40 gross income of any taxpayer that owns property for which bonus
916	916	41 depreciation was allowed in the current taxable year or in an
917	917	42 earlier taxable year equal to the amount of adjusted gross income
918	918	2023 IN 359—LS 6854/DI 129 22
919	919	1 that would have been computed had an election not been made
920	920	2 under Section 168(k) of the Internal Revenue Code to apply bonus
921	921	3 depreciation to the property in the year that it was placed in
922	922	4 service.
923	923	5 (4) Add an amount equal to any deduction allowed under Section
924	924	6 172 of the Internal Revenue Code (concerning net operating
925	925	7 losses).
926	926	8 (5) Add or subtract the amount necessary to make the adjusted
927	927	9 gross income of any taxpayer that placed Section 179 property (as
928	928	10 defined in Section 179 of the Internal Revenue Code) in service
929	929	11 in the current taxable year or in an earlier taxable year equal to
930	930	12 the amount of adjusted gross income that would have been
931	931	13 computed had an election for federal income tax purposes not
932	932	14 been made for the year in which the property was placed in
933	933	15 service to take deductions under Section 179 of the Internal
934	934	16 Revenue Code in a total amount exceeding the sum of:
935	935	17 (A) twenty-five thousand dollars ($25,000) to the extent
936	936	18 deductions under Section 179 of the Internal Revenue Code
937	937	19 were not elected as provided in clause (B); and
938	938	20 (B) for taxable years beginning after December 31, 2017, the
939	939	21 deductions elected under Section 179 of the Internal Revenue
940	940	22 Code on property acquired in an exchange if:
941	941	23 (i) the exchange would have been eligible for
942	942	24 nonrecognition of gain or loss under Section 1031 of the
943	943	25 Internal Revenue Code in effect on January 1, 2017;
944	944	26 (ii) the exchange is not eligible for nonrecognition of gain or
945	945	27 loss under Section 1031 of the Internal Revenue Code; and
946	946	28 (iii) the taxpayer made an election to take deductions under
947	947	29 Section 179 of the Internal Revenue Code with regard to the
948	948	30 acquired property in the year that the property was placed
949	949	31 into service.
950	950	32 The amount of deductions allowable for an item of property
951	951	33 under this clause may not exceed the amount of adjusted gross
952	952	34 income realized on the property that would have been deferred
953	953	35 under the Internal Revenue Code in effect on January 1, 2017.
954	954	36 (6) Subtract income that is:
955	955	37 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
956	956	38 derived from patents); and
957	957	39 (B) included in the taxpayer's taxable income under the
958	958	40 Internal Revenue Code.
959	959	41 (7) Add an amount equal to any income not included in gross
960	960	42 income as a result of the deferral of income arising from business
961	961	2023 IN 359—LS 6854/DI 129 23
962	962	1 indebtedness discharged in connection with the reacquisition after
963	963	2 December 31, 2008, and before January 1, 2011, of an applicable
964	964	3 debt instrument, as provided in Section 108(i) of the Internal
965	965	4 Revenue Code. Subtract from the adjusted gross income of any
966	966	5 taxpayer that added an amount to adjusted gross income in a
967	967	6 previous year the amount necessary to offset the amount included
968	968	7 in federal gross income as a result of the deferral of income
969	969	8 arising from business indebtedness discharged in connection with
970	970	9 the reacquisition after December 31, 2008, and before January 1,
971	971	10 2011, of an applicable debt instrument, as provided in Section
972	972	11 108(i) of the Internal Revenue Code.
973	973	12 (8) Add the amount excluded from federal gross income under
974	974	13 Section 103 of the Internal Revenue Code for interest received on
975	975	14 an obligation of a state other than Indiana, or a political
976	976	15 subdivision of such a state, that is acquired by the taxpayer after
977	977	16 December 31, 2011.
978	978	17 (9) For taxable years beginning after December 25, 2016, add an
979	979	18 amount equal to:
980	980	19 (A) the amount reported by the taxpayer on IRC 965
981	981	20 Transition Tax Statement, line 1;
982	982	21 (B) if the taxpayer deducted an amount under Section 965(c)
983	983	22 of the Internal Revenue Code in determining the taxpayer's
984	984	23 taxable income for purposes of the federal income tax, the
985	985	24 amount deducted under Section 965(c) of the Internal Revenue
986	986	25 Code; and
987	987	26 (C) with regard to any amounts of income under Section 965
988	988	27 of the Internal Revenue Code distributed by the taxpayer, the
989	989	28 deduction under Section 965(c) of the Internal Revenue Code
990	990	29 attributable to such distributed amounts and not reported to the
991	991	30 beneficiary.
992	992	31 For purposes of this article, the amount required to be added back
993	993	32 under clause (B) is not considered to be distributed or
994	994	33 distributable to a beneficiary of the estate or trust for purposes of
995	995	34 Sections 651 and 661 of the Internal Revenue Code.
996	996	35 (10) Subtract any interest expense paid or accrued in the current
997	997	36 taxable year but not deducted as a result of the limitation imposed
998	998	37 under Section 163(j)(1) of the Internal Revenue Code. Add any
999	999	38 interest expense paid or accrued in a previous taxable year but
1000	1000	39 allowed as a deduction under Section 163 of the Internal Revenue
1001	1001	40 Code in the current taxable year. For purposes of this subdivision,
1002	1002	41 an interest expense is considered paid or accrued only in the first
1003	1003	42 taxable year the deduction would have been allowable under
1004	1004	2023 IN 359—LS 6854/DI 129 24
1005	1005	1 Section 163 of the Internal Revenue Code if the limitation under
1006	1006	2 Section 163(j)(1) of the Internal Revenue Code did not exist.
1007	1007	3 (11) Add an amount equal to the deduction for qualified business
1008	1008	4 income that was claimed by the taxpayer for the taxable year
1009	1009	5 under Section 199A of the Internal Revenue Code.
1010	1010	6 (12) Subtract the amount that would have been excluded from
1011	1011	7 gross income but for the enactment of Section 118(b)(2) of the
1012	1012	8 Internal Revenue Code for taxable years ending after December
1013	1013	9 22, 2017.
1014	1014	10 (13) Add an amount equal to the remainder of:
1015	1015	11 (A) the amount allowable as a deduction under Section 274(n)
1016	1016	12 of the Internal Revenue Code; minus
1017	1017	13 (B) the amount otherwise allowable as a deduction under
1018	1018	14 Section 274(n) of the Internal Revenue Code, if Section
1019	1019	15 274(n)(2)(D) of the Internal Revenue Code was not in effect
1020	1020	16 for amounts paid or incurred after December 31, 2020.
1021	1021	17 (14) For taxable years beginning after December 31, 2017, and
1022	1022	18 before January 1, 2021, add an amount equal to the excess
1023	1023	19 business loss of the taxpayer as defined in Section 461(l)(3) of the
1024	1024	20 Internal Revenue Code. In addition:
1025	1025	21 (A) If a taxpayer has an excess business loss under this
1026	1026	22 subdivision and also has modifications under subdivisions (3)
1027	1027	23 and (5) for property placed in service during the taxable year,
1028	1028	24 the taxpayer shall treat a portion of the taxable year
1029	1029	25 modifications for that property as occurring in the taxable year
1030	1030	26 the property is placed in service and a portion of the
1031	1031	27 modifications as occurring in the immediately following
1032	1032	28 taxable year.
1033	1033	29 (B) The portion of the modifications under subdivisions (3)
1034	1034	30 and (5) for property placed in service during the taxable year
1035	1035	31 treated as occurring in the taxable year in which the property
1036	1036	32 is placed in service equals:
1037	1037	33 (i) the modification for the property otherwise determined
1038	1038	34 under this section; minus
1039	1039	35 (ii) the excess business loss disallowed under this
1040	1040	36 subdivision;
1041	1041	37 but not less than zero (0).
1042	1042	38 (C) The portion of the modifications under subdivisions (3)
1043	1043	39 and (5) for property placed in service during the taxable year
1044	1044	40 treated as occurring in the taxable year immediately following
1045	1045	41 the taxable year in which the property is placed in service
1046	1046	42 equals the modification for the property otherwise determined
1047	1047	2023 IN 359—LS 6854/DI 129 25
1048	1048	1 under this section minus the amount in clause (B).
1049	1049	2 (D) Any reallocation of modifications between taxable years
1050	1050	3 under clauses (B) and (C) shall be first allocated to the
1051	1051	4 modification under subdivision (3), then to the modification
1052	1052	5 under subdivision (5).
1053	1053	6 (15) For taxable years ending after March 12, 2020, subtract an
1054	1054	7 amount equal to the deduction disallowed pursuant to:
1055	1055	8 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
1056	1056	9 as modified by Sections 206 and 207 of the Taxpayer Certainty
1057	1057	10 and Disaster Relief Tax Act (Division EE of Public Law
1058	1058	11 116-260); and
1059	1059	12 (B) Section 3134(e) of the Internal Revenue Code.
1060	1060	13 (16) For taxable years beginning after December 31, 2022,
1061	1061	14 subtract an amount equal to the deduction disallowed under
1062	1062	15 Section 280C(h) of the Internal Revenue Code.
1063	1063	16 (17) Add or subtract any other amounts the taxpayer is:
1064	1064	17 (A) required to add or subtract; or
1065	1065	18 (B) entitled to deduct;
1066	1066	19 under IC 6-3-2.
1067	1067	20 (g) Subsections (a)(35), (b)(20), (d)(19), (e)(19), or (f)(17) may not
1068	1068	21 be construed to require an add back or allow a deduction or exemption
1069	1069	22 more than once for a particular add back, deduction, or exemption.
1070	1070	23 (h) For taxable years beginning after December 25, 2016, if:
1071	1071	24 (1) a taxpayer is a shareholder, either directly or indirectly, in a
1072	1072	25 corporation that is an E&P deficit foreign corporation as defined
1073	1073	26 in Section 965(b)(3)(B) of the Internal Revenue Code, and the
1074	1074	27 earnings and profit deficit, or a portion of the earnings and profit
1075	1075	28 deficit, of the E&P deficit foreign corporation is permitted to
1076	1076	29 reduce the federal adjusted gross income or federal taxable
1077	1077	30 income of the taxpayer, the deficit, or the portion of the deficit,
1078	1078	31 shall also reduce the amount taxable under this section to the
1079	1079	32 extent permitted under the Internal Revenue Code, however, in no
1080	1080	33 case shall this permit a reduction in the amount taxable under
1081	1081	34 Section 965 of the Internal Revenue Code for purposes of this
1082	1082	35 section to be less than zero (0); and
1083	1083	36 (2) the Internal Revenue Service issues guidance that such an
1084	1084	37 income or deduction is not reported directly on a federal tax
1085	1085	38 return or is to be reported in a manner different than specified in
1086	1086	39 this section, this section shall be construed as if federal adjusted
1087	1087	40 gross income or federal taxable income included the income or
1088	1088	41 deduction.
1089	1089	42 (i) If a partner is required to include an item of income, a deduction,
1090	1090	2023 IN 359—LS 6854/DI 129 26
1091	1091	1 or another tax attribute in the partner's adjusted gross income tax return
1092	1092	2 pursuant to IC 6-3-4.5, such item shall be considered to be includible
1093	1093	3 in the partner's federal adjusted gross income or federal taxable
1094	1094	4 income, regardless of whether such item is actually required to be
1095	1095	5 reported by the partner for federal income tax purposes. For purposes
1096	1096	6 of this subsection:
1097	1097	7 (1) items for which a valid election is made under IC 6-3-4.5-6,
1098	1098	8 IC 6-3-4.5-8, or IC 6-3-4.5-9 shall not be required to be included
1099	1099	9 in the partner's adjusted gross income or taxable income; and
1100	1100	10 (2) items for which the partnership did not make an election under
1101	1101	11 IC 6-3-4.5-6, IC 6-3-4.5-8, or IC 6-3-4.5-9, but for which the
1102	1102	12 partnership is required to remit tax pursuant to IC 6-3-4.5-18,
1103	1103	13 shall be included in the partner's adjusted gross income or taxable
1104	1104	14 income.
1105	1105	15 SECTION 3. IC 6-3-2-6, AS AMENDED BY P.L.146-2020,
1106	1106	16 SECTION 23, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
1107	1107	17 JANUARY 1, 2024]: Sec. 6. (a) Each taxable year, an individual who
1108	1108	18 rents a dwelling for use as the individual's principal place of residence
1109	1109	19 may deduct from the individual's adjusted gross income (as defined in
1110	1110	20 IC 6-3-1-3.5(a)), the lesser of:
1111	1111	21 (1) the amount of rent paid by the individual with respect to the
1112	1112	22 dwelling during the taxable year; or
1113	1113	23 (2) three four thousand dollars ($3,000). ($4,000).
1114	1114	24 (b) Notwithstanding subsection (a):
1115	1115	25 (1) a married couple filing a joint return for a particular taxable
1116	1116	26 year may not claim a deduction under this section of more than
1117	1117	27 three four thousand dollars ($3,000); ($4,000); and
1118	1118	28 (2) a married individual filing a separate return for a particular
1119	1119	29 taxable year may not claim a deduction under this section of more
1120	1120	30 than one two thousand five hundred dollars ($1,500). ($2,000).
1121	1121	31 (c) The deduction provided by this section does not apply to an
1122	1122	32 individual who rents a dwelling that is exempt from Indiana property
1123	1123	33 tax.
1124	1124	34 (d) For purposes of this section, a "dwelling" includes a single
1125	1125	35 family dwelling and unit of a multi-family dwelling.
1126	1126	36 SECTION 4. [EFFECTIVE JANUARY 1, 2024] (a) IC 6-3-1-3.5
1127	1127	37 and IC 6-3-2-6, both as amended by this act, apply to taxable years
1128	1128	38 beginning after December 31, 2023.
1129	1129	39 (b) This SECTION expires January 1, 2028.
1130	1130	2023 IN 359—LS 6854/DI 129