Introduced Version
HOUSE BILL No. 1388
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-3; IC 6-3.5-12; IC 8-1-2-4.4; IC 23-19-1-2;
IC 27-1-12.7-6; IC 28-8-4.1-201; IC 34-30-34.5; IC 35-46-7-2; IC 36-1.
Synopsis: Use of digital assets. Provides an income tax deduction for
short term or long term capital gain that is attributable to the sale or
exchange of digital assets in a transaction and that is included in
federal adjusted gross income, in an amount not to exceed $200 per
transaction for the 2024 taxable year, and adjusted annually for
inflation each taxable year thereafter. Provides that a county or
municipality may not: (1) impose a tax that is assessed based on use of
a digital asset as payment in a transaction; or (2) impose a tax on
transactions at a different rate based on the use of a digital asset for
payment in the transaction. Prohibits the Indiana utility regulatory
commission (commission) from approving a rate schedule for
electricity supplied by an electricity supplier to digital asset mining
businesses that is unreasonable or unjustly discriminatory as compared
to the rate schedule approved by the commission for electricity
supplied by the electricity supplier to industrial customers. Provides
that a person is not required to be licensed as a securities broker-dealer
solely because the person provides, or offers to provide, specified
services with respect to transactions involving digital assets. Provides
that specified operations conducted with respect to maintenance of a
blockchain do not constitute money transmission for purposes of
statutes regarding licensure of money transmitters. Provides immunity
from civil liability for a person that performs specified actions with
respect to validation of a transaction on a blockchain network. Prohibits
a county, municipality, or township from adopting or enforcing an
ordinance that would have the effect of prohibiting, restricting, or
impairing an individual's ability to: (1) use digital assets to purchase
(Continued next page)
Effective: January 1, 2024 (retroactive); July 1, 2024.
VanNatter
January 11, 2024, read first time and referred to Committee on Ways and Means.
2024 IN 1388—LS 6710/DI 119 Digest Continued
legal goods and services; or (2) use a hardware wallet or self-hosted
wallet to store the individual's digital assets. Provides that use of a
property for digital asset mining is a permitted industrial use under any
applicable zoning ordinance of a unit and may not be disallowed by a
zoning ordinance in a zoning district that permits industrial use.
Prohibits a unit from applying the unit's zoning ordinances in specified
ways to regulate digital asset mining. Makes conforming amendments
and technical corrections.
2024 IN 1388—LS 6710/DI 1192024 IN 1388—LS 6710/DI 119 Introduced
Second Regular Session of the 123rd General Assembly (2024)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
between statutes enacted by the 2023 Regular Session of the General Assembly.
HOUSE BILL No. 1388
A BILL FOR AN ACT to amend the Indiana Code concerning
technology.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 6-3-1-3.5, AS AMENDED BY P.L.236-2023,
2 SECTION 63, AND AS AMENDED BY P.L.194-2023, SECTION 7,
3 AND AS AMENDED BY P.L.201-2023, SECTION 94, AND AS
4 AMENDED BY P.L.202-2023, SECTION 7, AND AS AMENDED BY
5 THE TECHNICAL CORRECTIONS BILL OF THE 2024 GENERAL
6 ASSEMBLY, IS CORRECTED AND AMENDED TO READ AS
7 FOLLOWS [EFFECTIVE JANUARY 1, 2024 (RETROACTIVE)]:
8 Sec. 3.5. When used in this article, the term "adjusted gross income"
9 shall mean the following:
10 (a) In the case of all individuals, "adjusted gross income" (as
11 defined in Section 62 of the Internal Revenue Code), modified as
12 follows:
13 (1) Subtract income that is exempt from taxation under this article
14 by the Constitution and statutes of the United States.
15 (2) Except as provided in subsection (c), add an amount equal to
2024 IN 1388—LS 6710/DI 119 2
1 any deduction or deductions allowed or allowable pursuant to
2 Section 62 of the Internal Revenue Code for taxes based on or
3 measured by income and levied at the state level by any state of
4 the United States.
5 (3) Subtract one thousand dollars ($1,000), or in the case of a
6 joint return filed by a husband and wife, subtract for each spouse
7 one thousand dollars ($1,000).
8 (4) Subtract one thousand dollars ($1,000) for:
9 (A) each of the exemptions provided by Section 151(c) of the
10 Internal Revenue Code (as effective January 1, 2017);
11 (B) each additional amount allowable under Section 63(f) of
12 the Internal Revenue Code; and
13 (C) the spouse of the taxpayer if a separate return is made by
14 the taxpayer and if the spouse, for the calendar year in which
15 the taxable year of the taxpayer begins, has no gross income
16 and is not the dependent of another taxpayer.
17 (5) Subtract each of the following:
18 (A) One thousand five hundred dollars ($1,500) for each of the
19 exemptions allowed under Section 151(c)(1)(B) of the Internal
20 Revenue Code (as effective January 1, 2004), except that in
21 the first taxable year in which a particular exemption is
22 allowed under Section 151(c)(1)(B) of the Internal Revenue
23 Code (as effective January 1, 2004), subtract three thousand
24 dollars ($3,000) for that exemption.
25 (B) One thousand five hundred dollars ($1,500) for each
26 exemption allowed under Section 151(c) of the Internal
27 Revenue Code (as effective January 1, 2017) for an individual:
28 (i) who is less than nineteen (19) years of age or is a
29 full-time student who is less than twenty-four (24) years of
30 age;
31 (ii) for whom the taxpayer is the legal guardian; and
32 (iii) for whom the taxpayer does not claim an exemption
33 under clause (A).
34 (C) Five hundred dollars ($500) for each additional amount
35 allowable under Section 63(f)(1) of the Internal Revenue Code
36 if the federal adjusted gross income of the taxpayer, or the
37 taxpayer and the taxpayer's spouse in the case of a joint return,
38 is less than forty thousand dollars ($40,000). In the case of a
39 married individual filing a separate return, the qualifying
40 income amount in this clause is equal to twenty thousand
41 dollars ($20,000).
42 (D) Three thousand dollars ($3,000) for each exemption
2024 IN 1388—LS 6710/DI 119 3
1 allowed under Section 151(c) of the Internal Revenue Code (as
2 effective January 1, 2017) for an individual who is:
3 (i) an adopted child of the taxpayer; and
4 (ii) less than nineteen (19) years of age or is a full-time
5 student who is less than twenty-four (24) years of age.
6 This amount is in addition to any amount subtracted under
7 clause (A) or (B).
8 This amount is in addition to the amount subtracted under
9 subdivision (4).
10 (6) Subtract any amounts included in federal adjusted gross
11 income under Section 111 of the Internal Revenue Code as a
12 recovery of items previously deducted as an itemized deduction
13 from adjusted gross income.
14 (7) Subtract any amounts included in federal adjusted gross
15 income under the Internal Revenue Code which amounts were
16 received by the individual as supplemental railroad retirement
17 annuities under 45 U.S.C. 231 and which are not deductible under
18 subdivision (1).
19 (8) Subtract an amount equal to the amount of federal Social
20 Security and Railroad Retirement benefits included in a taxpayer's
21 federal gross income by Section 86 of the Internal Revenue Code.
22 (9) In the case of a nonresident taxpayer or a resident taxpayer
23 residing in Indiana for a period of less than the taxpayer's entire
24 taxable year, the total amount of the deductions allowed pursuant
25 to subdivisions (3), (4), and (5) shall be reduced to an amount
26 which bears the same ratio to the total as the taxpayer's income
27 taxable in Indiana bears to the taxpayer's total income.
28 (10) In the case of an individual who is a recipient of assistance
29 under IC 12-10-6-1, IC 12-10-6-2.1, IC 12-15-2-2, or IC 12-15-7,
30 subtract an amount equal to that portion of the individual's
31 adjusted gross income with respect to which the individual is not
32 allowed under federal law to retain an amount to pay state and
33 local income taxes.
34 (11) In the case of an eligible individual, subtract the amount of
35 a Holocaust victim's settlement payment included in the
36 individual's federal adjusted gross income.
37 (12) Subtract an amount equal to the portion of any premiums
38 paid during the taxable year by the taxpayer for a qualified long
39 term care policy (as defined in IC 12-15-39.6-5) for the taxpayer
40 or the taxpayer's spouse if the taxpayer and the taxpayer's spouse
41 file a joint income tax return or the taxpayer is otherwise entitled
42 to a deduction under this subdivision for the taxpayer's spouse, or
2024 IN 1388—LS 6710/DI 119 4
1 both.
2 (13) Subtract an amount equal to the lesser of:
3 (A) two thousand five hundred dollars ($2,500), or one
4 thousand two hundred fifty dollars ($1,250) in the case of a
5 married individual filing a separate return; or
6 (B) the amount of property taxes that are paid during the
7 taxable year in Indiana by the individual on the individual's
8 principal place of residence.
9 (14) Subtract an amount equal to the amount of a September 11
10 terrorist attack settlement payment included in the individual's
11 federal adjusted gross income.
12 (15) Add or subtract the amount necessary to make the adjusted
13 gross income of any taxpayer that owns property for which bonus
14 depreciation was allowed in the current taxable year or in an
15 earlier taxable year equal to the amount of adjusted gross income
16 that would have been computed had an election not been made
17 under Section 168(k) of the Internal Revenue Code to apply bonus
18 depreciation to the property in the year that it was placed in
19 service.
20 (16) Add an amount equal to any deduction allowed under
21 Section 172 of the Internal Revenue Code (concerning net
22 operating losses).
23 (17) Add or subtract the amount necessary to make the adjusted
24 gross income of any taxpayer that placed Section 179 property (as
25 defined in Section 179 of the Internal Revenue Code) in service
26 in the current taxable year or in an earlier taxable year equal to
27 the amount of adjusted gross income that would have been
28 computed had an election for federal income tax purposes not
29 been made for the year in which the property was placed in
30 service to take deductions under Section 179 of the Internal
31 Revenue Code in a total amount exceeding the sum of:
32 (A) twenty-five thousand dollars ($25,000) to the extent
33 deductions under Section 179 of the Internal Revenue Code
34 were not elected as provided in clause (B); and
35 (B) for taxable years beginning after December 31, 2017, the
36 deductions elected under Section 179 of the Internal Revenue
37 Code on property acquired in an exchange if:
38 (i) the exchange would have been eligible for
39 nonrecognition of gain or loss under Section 1031 of the
40 Internal Revenue Code in effect on January 1, 2017;
41 (ii) the exchange is not eligible for nonrecognition of gain or
42 loss under Section 1031 of the Internal Revenue Code; and
2024 IN 1388—LS 6710/DI 119 5
1 (iii) the taxpayer made an election to take deductions under
2 Section 179 of the Internal Revenue Code with regard to the
3 acquired property in the year that the property was placed
4 into service.
5 The amount of deductions allowable for an item of property
6 under this clause may not exceed the amount of adjusted gross
7 income realized on the property that would have been deferred
8 under the Internal Revenue Code in effect on January 1, 2017.
9 (18) Subtract an amount equal to the amount of the taxpayer's
10 qualified military income that was not excluded from the
11 taxpayer's gross income for federal income tax purposes under
12 Section 112 of the Internal Revenue Code.
13 (19) Subtract income that is:
14 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
15 derived from patents); and
16 (B) included in the individual's federal adjusted gross income
17 under the Internal Revenue Code.
18 (20) Add an amount equal to any income not included in gross
19 income as a result of the deferral of income arising from business
20 indebtedness discharged in connection with the reacquisition after
21 December 31, 2008, and before January 1, 2011, of an applicable
22 debt instrument, as provided in Section 108(i) of the Internal
23 Revenue Code. Subtract the amount necessary from the adjusted
24 gross income of any taxpayer that added an amount to adjusted
25 gross income in a previous year to offset the amount included in
26 federal gross income as a result of the deferral of income arising
27 from business indebtedness discharged in connection with the
28 reacquisition after December 31, 2008, and before January 1,
29 2011, of an applicable debt instrument, as provided in Section
30 108(i) of the Internal Revenue Code.
31 (21) Add the amount excluded from federal gross income under
32 Section 103 of the Internal Revenue Code for interest received on
33 an obligation of a state other than Indiana, or a political
34 subdivision of such a state, that is acquired by the taxpayer after
35 December 31, 2011. For purposes of this subdivision:
36 (A) if the taxpayer receives interest from a pass through entity,
37 a regulated investment company, a hedge fund, or similar
38 arrangement, the taxpayer will be considered to have
39 acquired the obligation on the date the entity acquired the
40 obligation;
41 (B) if ownership of the obligation occurs by means other than
42 a purchase, the date of acquisition of the obligation shall be
2024 IN 1388—LS 6710/DI 119 6
1 the date ownership of the obligation was transferred, except
2 to the extent provided in clause (A), and if a portion of the
3 obligation is acquired on multiple dates, the date of
4 acquisition shall be considered separately for each portion of
5 the obligation; and
6 (C) if ownership of the obligation occurred as the result of a
7 refinancing of another obligation, the acquisition date shall be
8 the date on which the obligation was refinanced.
9 (22) Subtract an amount as described in Section 1341(a)(2) of the
10 Internal Revenue Code to the extent, if any, that the amount was
11 previously included in the taxpayer's adjusted gross income for a
12 prior taxable year.
13 (23) For taxable years beginning after December 25, 2016, add an
14 amount equal to the deduction for deferred foreign income that
15 was claimed by the taxpayer for the taxable year under Section
16 965(c) of the Internal Revenue Code.
17 (24) Subtract any interest expense paid or accrued in the current
18 taxable year but not deducted as a result of the limitation imposed
19 under Section 163(j)(1) of the Internal Revenue Code. Add any
20 interest expense paid or accrued in a previous taxable year but
21 allowed as a deduction under Section 163 of the Internal Revenue
22 Code in the current taxable year. For purposes of this subdivision,
23 an interest expense is considered paid or accrued only in the first
24 taxable year the deduction would have been allowable under
25 Section 163 of the Internal Revenue Code if the limitation under
26 Section 163(j)(1) of the Internal Revenue Code did not exist.
27 (25) Subtract the amount that would have been excluded from
28 gross income but for the enactment of Section 118(b)(2) of the
29 Internal Revenue Code for taxable years ending after December
30 22, 2017.
31 (26) For taxable years beginning after December 31, 2019, and
32 before January 1, 2021, add an amount of the deduction claimed
33 under Section 62(a)(22) of the Internal Revenue Code.
34 (27) For taxable years beginning after December 31, 2019, for
35 payments made by an employer under an education assistance
36 program after March 27, 2020:
37 (A) add the amount of payments by an employer that are
38 excluded from the taxpayer's federal gross income under
39 Section 127(c)(1)(B) of the Internal Revenue Code; and
40 (B) deduct the interest allowable under Section 221 of the
41 Internal Revenue Code, if the disallowance under Section
42 221(e)(1) of the Internal Revenue Code did not apply to the
2024 IN 1388—LS 6710/DI 119 7
1 payments described in clause (A). For purposes of applying
2 Section 221(b) of the Internal Revenue Code to the amount
3 allowable under this clause, the amount under clause (A) shall
4 not be added to adjusted gross income.
5 (28) Add an amount equal to the remainder of:
6 (A) the amount allowable as a deduction under Section 274(n)
7 of the Internal Revenue Code; minus
8 (B) the amount otherwise allowable as a deduction under
9 Section 274(n) of the Internal Revenue Code, if Section
10 274(n)(2)(D) of the Internal Revenue Code was not in effect
11 for amounts paid or incurred after December 31, 2020.
12 (29) For taxable years beginning after December 31, 2017, and
13 before January 1, 2021, add an amount equal to the excess
14 business loss of the taxpayer as defined in Section 461(l)(3) of the
15 Internal Revenue Code. In addition:
16 (A) If a taxpayer has an excess business loss under this
17 subdivision and also has modifications under subdivisions (15)
18 and (17) for property placed in service during the taxable year,
19 the taxpayer shall treat a portion of the taxable year
20 modifications for that property as occurring in the taxable year
21 the property is placed in service and a portion of the
22 modifications as occurring in the immediately following
23 taxable year.
24 (B) The portion of the modifications under subdivisions (15)
25 and (17) for property placed in service during the taxable year
26 treated as occurring in the taxable year in which the property
27 is placed in service equals:
28 (i) the modification for the property otherwise determined
29 under this section; minus
30 (ii) the excess business loss disallowed under this
31 subdivision;
32 but not less than zero (0).
33 (C) The portion of the modifications under subdivisions (15)
34 and (17) for property placed in service during the taxable year
35 treated as occurring in the taxable year immediately following
36 the taxable year in which the property is placed in service
37 equals the modification for the property otherwise determined
38 under this section minus the amount in clause (B).
39 (D) Any reallocation of modifications between taxable years
40 under clauses (B) and (C) shall be first allocated to the
41 modification under subdivision (15), then to the modification
42 under subdivision (17).
2024 IN 1388—LS 6710/DI 119 8
1 (30) Add an amount equal to the amount excluded from federal
2 gross income under Section 108(f)(5) of the Internal Revenue
3 Code. For purposes of this subdivision:
4 (A) if an amount excluded under Section 108(f)(5) of the
5 Internal Revenue Code would be excludible under Section
6 108(a)(1)(B) of the Internal Revenue Code, the exclusion
7 under Section 108(a)(1)(B) of the Internal Revenue Code shall
8 take precedence; and
9 (B) if an amount would have been excludible under Section
10 108(f)(5) of the Internal Revenue Code as in effect on January
11 1, 2020, the amount is not required to be added back under this
12 subdivision.
13 (31) For taxable years ending after March 12, 2020, subtract an
14 amount equal to the deduction disallowed pursuant to:
15 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
16 as modified by Sections 206 and 207 of the Taxpayer Certainty
17 and Disaster Relief Tax Act (Division EE of Public Law
18 116-260); and
19 (B) Section 3134(e) of the Internal Revenue Code.
20 (32) Subtract the amount of an ESA annual grant amount and, as
21 applicable, a CSA annual grant amount distributed to a taxpayer's
22 Indiana education scholarship account under IC 20-51.4-4-2
23 IC 20-51.4 that is used for a an ESA or CSA qualified expense (as
24 defined in IC 20-51.4-2-9) IC 20-51.4-2) or to an Indiana
25 enrichment scholarship account under IC 20-52 that is used for
26 qualified expenses (as defined in IC 20-52-2-6), to the extent the
27 distribution used for the qualified expense is included in the
28 taxpayer's federal adjusted gross income under the Internal
29 Revenue Code.
30 (33) For taxable years beginning after December 31, 2019, and
31 before January 1, 2021, add an amount equal to the amount of
32 unemployment compensation excluded from federal gross income
33 under Section 85(c) of the Internal Revenue Code.
34 (34) For taxable years beginning after December 31, 2022,
35 subtract an amount equal to the deduction disallowed under
36 Section 280C(h) of the Internal Revenue Code.
37 (35) For taxable years beginning after December 31, 2021, add
38 or subtract amounts related to specified research or experimental
39 procedures as required under IC 6-3-2-29.
40 (36) Subtract the amount of short term or long term capital
41 gain that is attributable to the sale or exchange of one (1) or
42 more digital assets in a transaction and that is included in
2024 IN 1388—LS 6710/DI 119 9
1 federal adjusted gross income, not to exceed:
2 (A) for taxable years beginning after December 31, 2023,
3 and before January 1, 2025, two hundred dollars ($200)
4 per transaction; and
5 (B) for taxable years beginning after December 31, 2024,
6 an amount per transaction equal to the maximum
7 deduction allowed under this subdivision in the
8 immediately preceding calendar year adjusted by the
9 annual percentage change in the Consumer Price Index for
10 All Urban Consumers published by the federal Bureau of
11 Labor Statistics for the immediately preceding calendar
12 year.
13 (35) (36) (37) Subtract any other amounts the taxpayer is entitled
14 to deduct under IC 6-3-2.
15 (36) (37) (38) Subtract the amount of a CSA annual grant amount
16 distributed to a taxpayer's career scholarship account under
17 IC 20-51.4-4.5 that is used for a CSA qualified expense (as
18 defined in IC 20-51.4-2-3.8), to the extent the distribution used
19 for the CSA qualified expense is included in the taxpayer's federal
20 adjusted gross income under the Internal Revenue Code.
21 (b) In the case of corporations, the same as "taxable income" (as
22 defined in Section 63 of the Internal Revenue Code) adjusted as
23 follows:
24 (1) Subtract income that is exempt from taxation under this article
25 by the Constitution and statutes of the United States.
26 (2) Add an amount equal to any deduction or deductions allowed
27 or allowable pursuant to Section 170 of the Internal Revenue
28 Code (concerning charitable contributions).
29 (3) Except as provided in subsection (c), add an amount equal to
30 any deduction or deductions allowed or allowable pursuant to
31 Section 63 of the Internal Revenue Code for taxes based on or
32 measured by income and levied at the state level by any state of
33 the United States.
34 (4) Subtract an amount equal to the amount included in the
35 corporation's taxable income under Section 78 of the Internal
36 Revenue Code (concerning foreign tax credits).
37 (5) Add or subtract the amount necessary to make the adjusted
38 gross income of any taxpayer that owns property for which bonus
39 depreciation was allowed in the current taxable year or in an
40 earlier taxable year equal to the amount of adjusted gross income
41 that would have been computed had an election not been made
42 under Section 168(k) of the Internal Revenue Code to apply bonus
2024 IN 1388—LS 6710/DI 119 10
1 depreciation to the property in the year that it was placed in
2 service.
3 (6) Add an amount equal to any deduction allowed under Section
4 172 of the Internal Revenue Code (concerning net operating
5 losses).
6 (7) Add or subtract the amount necessary to make the adjusted
7 gross income of any taxpayer that placed Section 179 property (as
8 defined in Section 179 of the Internal Revenue Code) in service
9 in the current taxable year or in an earlier taxable year equal to
10 the amount of adjusted gross income that would have been
11 computed had an election for federal income tax purposes not
12 been made for the year in which the property was placed in
13 service to take deductions under Section 179 of the Internal
14 Revenue Code in a total amount exceeding the sum of:
15 (A) twenty-five thousand dollars ($25,000) to the extent
16 deductions under Section 179 of the Internal Revenue Code
17 were not elected as provided in clause (B); and
18 (B) for taxable years beginning after December 31, 2017, the
19 deductions elected under Section 179 of the Internal Revenue
20 Code on property acquired in an exchange if:
21 (i) the exchange would have been eligible for
22 nonrecognition of gain or loss under Section 1031 of the
23 Internal Revenue Code in effect on January 1, 2017;
24 (ii) the exchange is not eligible for nonrecognition of gain or
25 loss under Section 1031 of the Internal Revenue Code; and
26 (iii) the taxpayer made an election to take deductions under
27 Section 179 of the Internal Revenue Code with regard to the
28 acquired property in the year that the property was placed
29 into service.
30 The amount of deductions allowable for an item of property
31 under this clause may not exceed the amount of adjusted gross
32 income realized on the property that would have been deferred
33 under the Internal Revenue Code in effect on January 1, 2017.
34 (8) Add to the extent required by IC 6-3-2-20:
35 (A) the amount of intangible expenses (as defined in
36 IC 6-3-2-20) for the taxable year that reduced the corporation's
37 taxable income (as defined in Section 63 of the Internal
38 Revenue Code) for federal income tax purposes; and
39 (B) any directly related interest expenses (as defined in
40 IC 6-3-2-20) that reduced the corporation's adjusted gross
41 income (determined without regard to this subdivision). For
42 purposes of this clause, any directly related interest expense
2024 IN 1388—LS 6710/DI 119 11
1 that constitutes business interest within the meaning of Section
2 163(j) of the Internal Revenue Code shall be considered to
3 have reduced the taxpayer's federal taxable income only in the
4 first taxable year in which the deduction otherwise would have
5 been allowable under Section 163 of the Internal Revenue
6 Code if the limitation under Section 163(j)(1) of the Internal
7 Revenue Code did not exist.
8 (9) Add an amount equal to any deduction for dividends paid (as
9 defined in Section 561 of the Internal Revenue Code) to
10 shareholders of a captive real estate investment trust (as defined
11 in section 34.5 of this chapter).
12 (10) Subtract income that is:
13 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
14 derived from patents); and
15 (B) included in the corporation's taxable income under the
16 Internal Revenue Code.
17 (11) Add an amount equal to any income not included in gross
18 income as a result of the deferral of income arising from business
19 indebtedness discharged in connection with the reacquisition after
20 December 31, 2008, and before January 1, 2011, of an applicable
21 debt instrument, as provided in Section 108(i) of the Internal
22 Revenue Code. Subtract from the adjusted gross income of any
23 taxpayer that added an amount to adjusted gross income in a
24 previous year the amount necessary to offset the amount included
25 in federal gross income as a result of the deferral of income
26 arising from business indebtedness discharged in connection with
27 the reacquisition after December 31, 2008, and before January 1,
28 2011, of an applicable debt instrument, as provided in Section
29 108(i) of the Internal Revenue Code.
30 (12) Add the amount excluded from federal gross income under
31 Section 103 of the Internal Revenue Code for interest received on
32 an obligation of a state other than Indiana, or a political
33 subdivision of such a state, that is acquired by the taxpayer after
34 December 31, 2011. For purposes of this subdivision:
35 (A) if the taxpayer receives interest from a pass through entity,
36 a regulated investment company, a hedge fund, or similar
37 arrangement, the taxpayer will be considered to have
38 acquired the obligation on the date the entity acquired the
39 obligation;
40 (B) if ownership of the obligation occurs by means other than
41 a purchase, the date of acquisition of the obligation shall be
42 the date ownership of the obligation was transferred, except
2024 IN 1388—LS 6710/DI 119 12
1 to the extent provided in clause (A), and if a portion of the
2 obligation is acquired on multiple dates, the date of
3 acquisition shall be considered separately for each portion of
4 the obligation; and
5 (C) if ownership of the obligation occurred as the result of a
6 refinancing of another obligation, the acquisition date shall be
7 the date on which the obligation was refinanced.
8 (13) For taxable years beginning after December 25, 2016:
9 (A) for a corporation other than a real estate investment trust,
10 add:
11 (i) an amount equal to the amount reported by the taxpayer
12 on IRC 965 Transition Tax Statement, line 1; or
13 (ii) if the taxpayer deducted an amount under Section 965(c)
14 of the Internal Revenue Code in determining the taxpayer's
15 taxable income for purposes of the federal income tax, the
16 amount deducted under Section 965(c) of the Internal
17 Revenue Code; and
18 (B) for a real estate investment trust, add an amount equal to
19 the deduction for deferred foreign income that was claimed by
20 the taxpayer for the taxable year under Section 965(c) of the
21 Internal Revenue Code, but only to the extent that the taxpayer
22 included income pursuant to Section 965 of the Internal
23 Revenue Code in its taxable income for federal income tax
24 purposes or is required to add back dividends paid under
25 subdivision (9).
26 (14) Add an amount equal to the deduction that was claimed by
27 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
28 Internal Revenue Code (attributable to global intangible
29 low-taxed income). The taxpayer shall separately specify the
30 amount of the reduction under Section 250(a)(1)(B)(i) of the
31 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
32 Internal Revenue Code.
33 (15) Subtract any interest expense paid or accrued in the current
34 taxable year but not deducted as a result of the limitation imposed
35 under Section 163(j)(1) of the Internal Revenue Code. Add any
36 interest expense paid or accrued in a previous taxable year but
37 allowed as a deduction under Section 163 of the Internal Revenue
38 Code in the current taxable year. For purposes of this subdivision,
39 an interest expense is considered paid or accrued only in the first
40 taxable year the deduction would have been allowable under
41 Section 163 of the Internal Revenue Code if the limitation under
42 Section 163(j)(1) of the Internal Revenue Code did not exist.
2024 IN 1388—LS 6710/DI 119 13
1 (16) Subtract the amount that would have been excluded from
2 gross income but for the enactment of Section 118(b)(2) of the
3 Internal Revenue Code for taxable years ending after December
4 22, 2017.
5 (17) Add an amount equal to the remainder of:
6 (A) the amount allowable as a deduction under Section 274(n)
7 of the Internal Revenue Code; minus
8 (B) the amount otherwise allowable as a deduction under
9 Section 274(n) of the Internal Revenue Code, if Section
10 274(n)(2)(D) of the Internal Revenue Code was not in effect
11 for amounts paid or incurred after December 31, 2020.
12 (18) For taxable years ending after March 12, 2020, subtract an
13 amount equal to the deduction disallowed pursuant to:
14 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
15 as modified by Sections 206 and 207 of the Taxpayer Certainty
16 and Disaster Relief Tax Act (Division EE of Public Law
17 116-260); and
18 (B) Section 3134(e) of the Internal Revenue Code.
19 (19) For taxable years beginning after December 31, 2022,
20 subtract an amount equal to the deduction disallowed under
21 Section 280C(h) of the Internal Revenue Code.
22 (20) For taxable years beginning after December 31, 2021,
23 subtract the amount of any:
24 (A) federal, state, or local grant received by the taxpayer; and
25 (B) discharged federal, state, or local indebtedness incurred
26 by the taxpayer;
27 for purposes of providing or expanding access to broadband
28 service in this state.
29 (21) For taxable years beginning after December 31, 2021, add
30 or subtract amounts related to specified research or experimental
31 procedures as required under IC 6-3-2-29.
32 (22) Subtract the amount of short term or long term capital
33 gain that is attributable to the sale or exchange of one (1) or
34 more digital assets in a transaction and that is included in
35 federal adjusted gross income, not to exceed:
36 (A) for taxable years beginning after December 31, 2023,
37 and before January 1, 2025, two hundred dollars ($200)
38 per transaction; and
39 (B) for taxable years beginning after December 31, 2024,
40 an amount per transaction equal to the maximum
41 deduction allowed under this subdivision in the
42 immediately preceding calendar year adjusted by the
2024 IN 1388—LS 6710/DI 119 14
1 annual percentage change in the Consumer Price Index for
2 All Urban Consumers published by the federal Bureau of
3 Labor Statistics for the immediately preceding calendar
4 year.
5 (20) (22) (23) Add or subtract any other amounts the taxpayer is:
6 (A) required to add or subtract; or
7 (B) entitled to deduct;
8 under IC 6-3-2.
9 (c) The following apply to taxable years beginning after December
10 31, 2018, for purposes of the add back of any deduction allowed on the
11 taxpayer's federal income tax return for wagering taxes, as provided in
12 subsection (a)(2) if the taxpayer is an individual or subsection (b)(3) if
13 the taxpayer is a corporation:
14 (1) For taxable years beginning after December 31, 2018, and
15 before January 1, 2020, a taxpayer is required to add back under
16 this section eighty-seven and five-tenths percent (87.5%) of any
17 deduction allowed on the taxpayer's federal income tax return for
18 wagering taxes.
19 (2) For taxable years beginning after December 31, 2019, and
20 before January 1, 2021, a taxpayer is required to add back under
21 this section seventy-five percent (75%) of any deduction allowed
22 on the taxpayer's federal income tax return for wagering taxes.
23 (3) For taxable years beginning after December 31, 2020, and
24 before January 1, 2022, a taxpayer is required to add back under
25 this section sixty-two and five-tenths percent (62.5%) of any
26 deduction allowed on the taxpayer's federal income tax return for
27 wagering taxes.
28 (4) For taxable years beginning after December 31, 2021, and
29 before January 1, 2023, a taxpayer is required to add back under
30 this section fifty percent (50%) of any deduction allowed on the
31 taxpayer's federal income tax return for wagering taxes.
32 (5) For taxable years beginning after December 31, 2022, and
33 before January 1, 2024, a taxpayer is required to add back under
34 this section thirty-seven and five-tenths percent (37.5%) of any
35 deduction allowed on the taxpayer's federal income tax return for
36 wagering taxes.
37 (6) For taxable years beginning after December 31, 2023, and
38 before January 1, 2025, a taxpayer is required to add back under
39 this section twenty-five percent (25%) of any deduction allowed
40 on the taxpayer's federal income tax return for wagering taxes.
41 (7) For taxable years beginning after December 31, 2024, and
42 before January 1, 2026, a taxpayer is required to add back under
2024 IN 1388—LS 6710/DI 119 15
1 this section twelve and five-tenths percent (12.5%) of any
2 deduction allowed on the taxpayer's federal income tax return for
3 wagering taxes.
4 (8) For taxable years beginning after December 31, 2025, a
5 taxpayer is not required to add back under this section any amount
6 of a deduction allowed on the taxpayer's federal income tax return
7 for wagering taxes.
8 (d) In the case of life insurance companies (as defined in Section
9 816(a) of the Internal Revenue Code) that are organized under Indiana
10 law, the same as "life insurance company taxable income" (as defined
11 in Section 801 of the Internal Revenue Code), adjusted as follows:
12 (1) Subtract income that is exempt from taxation under this article
13 by the Constitution and statutes of the United States.
14 (2) Add an amount equal to any deduction allowed or allowable
15 under Section 170 of the Internal Revenue Code (concerning
16 charitable contributions).
17 (3) Add an amount equal to a deduction allowed or allowable
18 under Section 805 or Section 832(c) of the Internal Revenue Code
19 for taxes based on or measured by income and levied at the state
20 level by any state.
21 (4) Subtract an amount equal to the amount included in the
22 company's taxable income under Section 78 of the Internal
23 Revenue Code (concerning foreign tax credits).
24 (5) Add or subtract the amount necessary to make the adjusted
25 gross income of any taxpayer that owns property for which bonus
26 depreciation was allowed in the current taxable year or in an
27 earlier taxable year equal to the amount of adjusted gross income
28 that would have been computed had an election not been made
29 under Section 168(k) of the Internal Revenue Code to apply bonus
30 depreciation to the property in the year that it was placed in
31 service.
32 (6) Add an amount equal to any deduction allowed under Section
33 172 of the Internal Revenue Code (concerning net operating
34 losses).
35 (7) Add or subtract the amount necessary to make the adjusted
36 gross income of any taxpayer that placed Section 179 property (as
37 defined in Section 179 of the Internal Revenue Code) in service
38 in the current taxable year or in an earlier taxable year equal to
39 the amount of adjusted gross income that would have been
40 computed had an election for federal income tax purposes not
41 been made for the year in which the property was placed in
42 service to take deductions under Section 179 of the Internal
2024 IN 1388—LS 6710/DI 119 16
1 Revenue Code in a total amount exceeding the sum of:
2 (A) twenty-five thousand dollars ($25,000) to the extent
3 deductions under Section 179 of the Internal Revenue Code
4 were not elected as provided in clause (B); and
5 (B) for taxable years beginning after December 31, 2017, the
6 deductions elected under Section 179 of the Internal Revenue
7 Code on property acquired in an exchange if:
8 (i) the exchange would have been eligible for
9 nonrecognition of gain or loss under Section 1031 of the
10 Internal Revenue Code in effect on January 1, 2017;
11 (ii) the exchange is not eligible for nonrecognition of gain or
12 loss under Section 1031 of the Internal Revenue Code; and
13 (iii) the taxpayer made an election to take deductions under
14 Section 179 of the Internal Revenue Code with regard to the
15 acquired property in the year that the property was placed
16 into service.
17 The amount of deductions allowable for an item of property
18 under this clause may not exceed the amount of adjusted gross
19 income realized on the property that would have been deferred
20 under the Internal Revenue Code in effect on January 1, 2017.
21 (8) Subtract income that is:
22 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
23 derived from patents); and
24 (B) included in the insurance company's taxable income under
25 the Internal Revenue Code.
26 (9) Add an amount equal to any income not included in gross
27 income as a result of the deferral of income arising from business
28 indebtedness discharged in connection with the reacquisition after
29 December 31, 2008, and before January 1, 2011, of an applicable
30 debt instrument, as provided in Section 108(i) of the Internal
31 Revenue Code. Subtract from the adjusted gross income of any
32 taxpayer that added an amount to adjusted gross income in a
33 previous year the amount necessary to offset the amount included
34 in federal gross income as a result of the deferral of income
35 arising from business indebtedness discharged in connection with
36 the reacquisition after December 31, 2008, and before January 1,
37 2011, of an applicable debt instrument, as provided in Section
38 108(i) of the Internal Revenue Code.
39 (10) Add an amount equal to any exempt insurance income under
40 Section 953(e) of the Internal Revenue Code that is active
41 financing income under Subpart F of Subtitle A, Chapter 1,
42 Subchapter N of the Internal Revenue Code.
2024 IN 1388—LS 6710/DI 119 17
1 (11) Add the amount excluded from federal gross income under
2 Section 103 of the Internal Revenue Code for interest received on
3 an obligation of a state other than Indiana, or a political
4 subdivision of such a state, that is acquired by the taxpayer after
5 December 31, 2011. For purposes of this subdivision:
6 (A) if the taxpayer receives interest from a pass through entity,
7 a regulated investment company, a hedge fund, or similar
8 arrangement, the taxpayer will be considered to have
9 acquired the obligation on the date the entity acquired the
10 obligation;
11 (B) if ownership of the obligation occurs by means other than
12 a purchase, the date of acquisition of the obligation shall be
13 the date ownership of the obligation was transferred, except
14 to the extent provided in clause (A), and if a portion of the
15 obligation is acquired on multiple dates, the date of
16 acquisition shall be considered separately for each portion of
17 the obligation; and
18 (C) if ownership of the obligation occurred as the result of a
19 refinancing of another obligation, the acquisition date shall be
20 the date on which the obligation was refinanced.
21 (12) For taxable years beginning after December 25, 2016, add:
22 (A) an amount equal to the amount reported by the taxpayer on
23 IRC 965 Transition Tax Statement, line 1; or
24 (B) if the taxpayer deducted an amount under Section 965(c)
25 of the Internal Revenue Code in determining the taxpayer's
26 taxable income for purposes of the federal income tax, the
27 amount deducted under Section 965(c) of the Internal Revenue
28 Code.
29 (13) Add an amount equal to the deduction that was claimed by
30 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
31 Internal Revenue Code (attributable to global intangible
32 low-taxed income). The taxpayer shall separately specify the
33 amount of the reduction under Section 250(a)(1)(B)(i) of the
34 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
35 Internal Revenue Code.
36 (14) Subtract any interest expense paid or accrued in the current
37 taxable year but not deducted as a result of the limitation imposed
38 under Section 163(j)(1) of the Internal Revenue Code. Add any
39 interest expense paid or accrued in a previous taxable year but
40 allowed as a deduction under Section 163 of the Internal Revenue
41 Code in the current taxable year. For purposes of this subdivision,
42 an interest expense is considered paid or accrued only in the first
2024 IN 1388—LS 6710/DI 119 18
1 taxable year the deduction would have been allowable under
2 Section 163 of the Internal Revenue Code if the limitation under
3 Section 163(j)(1) of the Internal Revenue Code did not exist.
4 (15) Subtract the amount that would have been excluded from
5 gross income but for the enactment of Section 118(b)(2) of the
6 Internal Revenue Code for taxable years ending after December
7 22, 2017.
8 (16) Add an amount equal to the remainder of:
9 (A) the amount allowable as a deduction under Section 274(n)
10 of the Internal Revenue Code; minus
11 (B) the amount otherwise allowable as a deduction under
12 Section 274(n) of the Internal Revenue Code, if Section
13 274(n)(2)(D) of the Internal Revenue Code was not in effect
14 for amounts paid or incurred after December 31, 2020.
15 (17) For taxable years ending after March 12, 2020, subtract an
16 amount equal to the deduction disallowed pursuant to:
17 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
18 as modified by Sections 206 and 207 of the Taxpayer Certainty
19 and Disaster Relief Tax Act (Division EE of Public Law
20 116-260); and
21 (B) Section 3134(e) of the Internal Revenue Code.
22 (18) For taxable years beginning after December 31, 2022,
23 subtract an amount equal to the deduction disallowed under
24 Section 280C(h) of the Internal Revenue Code.
25 (19) For taxable years beginning after December 31, 2021, add
26 or subtract amounts related to specified research or experimental
27 procedures as required under IC 6-3-2-29.
28 (20) Subtract the amount of short term or long term capital
29 gain that is attributable to the sale or exchange of one (1) or
30 more digital assets in a transaction and that is included in
31 federal adjusted gross income, not to exceed:
32 (A) for taxable years beginning after December 31, 2023,
33 and before January 1, 2025, two hundred dollars ($200)
34 per transaction; and
35 (B) for taxable years beginning after December 31, 2024,
36 an amount per transaction equal to the maximum
37 deduction allowed under this subdivision in the
38 immediately preceding calendar year adjusted by the
39 annual percentage change in the Consumer Price Index for
40 All Urban Consumers published by the federal Bureau of
41 Labor Statistics for the immediately preceding calendar
42 year.
2024 IN 1388—LS 6710/DI 119 19
1 (19) (20) (21) Add or subtract any other amounts the taxpayer is:
2 (A) required to add or subtract; or
3 (B) entitled to deduct;
4 under IC 6-3-2.
5 (e) In the case of insurance companies subject to tax under Section
6 831 of the Internal Revenue Code and organized under Indiana law, the
7 same as "taxable income" (as defined in Section 832 of the Internal
8 Revenue Code), adjusted as follows:
9 (1) Subtract income that is exempt from taxation under this article
10 by the Constitution and statutes of the United States.
11 (2) Add an amount equal to any deduction allowed or allowable
12 under Section 170 of the Internal Revenue Code (concerning
13 charitable contributions).
14 (3) Add an amount equal to a deduction allowed or allowable
15 under Section 805 or Section 832(c) of the Internal Revenue Code
16 for taxes based on or measured by income and levied at the state
17 level by any state.
18 (4) Subtract an amount equal to the amount included in the
19 company's taxable income under Section 78 of the Internal
20 Revenue Code (concerning foreign tax credits).
21 (5) Add or subtract the amount necessary to make the adjusted
22 gross income of any taxpayer that owns property for which bonus
23 depreciation was allowed in the current taxable year or in an
24 earlier taxable year equal to the amount of adjusted gross income
25 that would have been computed had an election not been made
26 under Section 168(k) of the Internal Revenue Code to apply bonus
27 depreciation to the property in the year that it was placed in
28 service.
29 (6) Add an amount equal to any deduction allowed under Section
30 172 of the Internal Revenue Code (concerning net operating
31 losses).
32 (7) Add or subtract the amount necessary to make the adjusted
33 gross income of any taxpayer that placed Section 179 property (as
34 defined in Section 179 of the Internal Revenue Code) in service
35 in the current taxable year or in an earlier taxable year equal to
36 the amount of adjusted gross income that would have been
37 computed had an election for federal income tax purposes not
38 been made for the year in which the property was placed in
39 service to take deductions under Section 179 of the Internal
40 Revenue Code in a total amount exceeding the sum of:
41 (A) twenty-five thousand dollars ($25,000) to the extent
42 deductions under Section 179 of the Internal Revenue Code
2024 IN 1388—LS 6710/DI 119 20
1 were not elected as provided in clause (B); and
2 (B) for taxable years beginning after December 31, 2017, the
3 deductions elected under Section 179 of the Internal Revenue
4 Code on property acquired in an exchange if:
5 (i) the exchange would have been eligible for
6 nonrecognition of gain or loss under Section 1031 of the
7 Internal Revenue Code in effect on January 1, 2017;
8 (ii) the exchange is not eligible for nonrecognition of gain or
9 loss under Section 1031 of the Internal Revenue Code; and
10 (iii) the taxpayer made an election to take deductions under
11 Section 179 of the Internal Revenue Code with regard to the
12 acquired property in the year that the property was placed
13 into service.
14 The amount of deductions allowable for an item of property
15 under this clause may not exceed the amount of adjusted gross
16 income realized on the property that would have been deferred
17 under the Internal Revenue Code in effect on January 1, 2017.
18 (8) Subtract income that is:
19 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
20 derived from patents); and
21 (B) included in the insurance company's taxable income under
22 the Internal Revenue Code.
23 (9) Add an amount equal to any income not included in gross
24 income as a result of the deferral of income arising from business
25 indebtedness discharged in connection with the reacquisition after
26 December 31, 2008, and before January 1, 2011, of an applicable
27 debt instrument, as provided in Section 108(i) of the Internal
28 Revenue Code. Subtract from the adjusted gross income of any
29 taxpayer that added an amount to adjusted gross income in a
30 previous year the amount necessary to offset the amount included
31 in federal gross income as a result of the deferral of income
32 arising from business indebtedness discharged in connection with
33 the reacquisition after December 31, 2008, and before January 1,
34 2011, of an applicable debt instrument, as provided in Section
35 108(i) of the Internal Revenue Code.
36 (10) Add an amount equal to any exempt insurance income under
37 Section 953(e) of the Internal Revenue Code that is active
38 financing income under Subpart F of Subtitle A, Chapter 1,
39 Subchapter N of the Internal Revenue Code.
40 (11) Add the amount excluded from federal gross income under
41 Section 103 of the Internal Revenue Code for interest received on
42 an obligation of a state other than Indiana, or a political
2024 IN 1388—LS 6710/DI 119 21
1 subdivision of such a state, that is acquired by the taxpayer after
2 December 31, 2011. For purposes of this subdivision:
3 (A) if the taxpayer receives interest from a pass through entity,
4 a regulated investment company, a hedge fund, or similar
5 arrangement, the taxpayer will be considered to have
6 acquired the obligation on the date the entity acquired the
7 obligation;
8 (B) if ownership of the obligation occurs by means other than
9 a purchase, the date of acquisition of the obligation shall be
10 the date ownership of the obligation was transferred, except
11 to the extent provided in clause (A), and if a portion of the
12 obligation is acquired on multiple dates, the date of
13 acquisition shall be considered separately for each portion of
14 the obligation; and
15 (C) if ownership of the obligation occurred as the result of a
16 refinancing of another obligation, the acquisition date shall be
17 the date on which the obligation was refinanced.
18 (12) For taxable years beginning after December 25, 2016, add:
19 (A) an amount equal to the amount reported by the taxpayer on
20 IRC 965 Transition Tax Statement, line 1; or
21 (B) if the taxpayer deducted an amount under Section 965(c)
22 of the Internal Revenue Code in determining the taxpayer's
23 taxable income for purposes of the federal income tax, the
24 amount deducted under Section 965(c) of the Internal Revenue
25 Code.
26 (13) Add an amount equal to the deduction that was claimed by
27 the taxpayer for the taxable year under Section 250(a)(1)(B) of the
28 Internal Revenue Code (attributable to global intangible
29 low-taxed income). The taxpayer shall separately specify the
30 amount of the reduction under Section 250(a)(1)(B)(i) of the
31 Internal Revenue Code and under Section 250(a)(1)(B)(ii) of the
32 Internal Revenue Code.
33 (14) Subtract any interest expense paid or accrued in the current
34 taxable year but not deducted as a result of the limitation imposed
35 under Section 163(j)(1) of the Internal Revenue Code. Add any
36 interest expense paid or accrued in a previous taxable year but
37 allowed as a deduction under Section 163 of the Internal Revenue
38 Code in the current taxable year. For purposes of this subdivision,
39 an interest expense is considered paid or accrued only in the first
40 taxable year the deduction would have been allowable under
41 Section 163 of the Internal Revenue Code if the limitation under
42 Section 163(j)(1) of the Internal Revenue Code did not exist.
2024 IN 1388—LS 6710/DI 119 22
1 (15) Subtract the amount that would have been excluded from
2 gross income but for the enactment of Section 118(b)(2) of the
3 Internal Revenue Code for taxable years ending after December
4 22, 2017.
5 (16) Add an amount equal to the remainder of:
6 (A) the amount allowable as a deduction under Section 274(n)
7 of the Internal Revenue Code; minus
8 (B) the amount otherwise allowable as a deduction under
9 Section 274(n) of the Internal Revenue Code, if Section
10 274(n)(2)(D) of the Internal Revenue Code was not in effect
11 for amounts paid or incurred after December 31, 2020.
12 (17) For taxable years ending after March 12, 2020, subtract an
13 amount equal to the deduction disallowed pursuant to:
14 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
15 as modified by Sections 206 and 207 of the Taxpayer Certainty
16 and Disaster Relief Tax Act (Division EE of Public Law
17 116-260); and
18 (B) Section 3134(e) of the Internal Revenue Code.
19 (18) For taxable years beginning after December 31, 2022,
20 subtract an amount equal to the deduction disallowed under
21 Section 280C(h) of the Internal Revenue Code.
22 (19) For taxable years beginning after December 31, 2021, add
23 or subtract amounts related to specified research or experimental
24 procedures as required under IC 6-3-2-29.
25 (20) Subtract the amount of short term or long term capital
26 gain that is attributable to the sale or exchange of one (1) or
27 more digital assets in a transaction and that is included in
28 federal adjusted gross income, not to exceed:
29 (A) for taxable years beginning after December 31, 2023,
30 and before January 1, 2025, two hundred dollars ($200)
31 per transaction; and
32 (B) for taxable years beginning after December 31, 2024,
33 an amount per transaction equal to the maximum
34 deduction allowed under this subdivision in the
35 immediately preceding calendar year adjusted by the
36 annual percentage change in the Consumer Price Index for
37 All Urban Consumers published by the federal Bureau of
38 Labor Statistics for the immediately preceding calendar
39 year.
40 (19) (20) (21) Add or subtract any other amounts the taxpayer is:
41 (A) required to add or subtract; or
42 (B) entitled to deduct;
2024 IN 1388—LS 6710/DI 119 23
1 under IC 6-3-2.
2 (f) In the case of trusts and estates, "taxable income" (as defined for
3 trusts and estates in Section 641(b) of the Internal Revenue Code)
4 adjusted as follows:
5 (1) Subtract income that is exempt from taxation under this article
6 by the Constitution and statutes of the United States.
7 (2) Subtract an amount equal to the amount of a September 11
8 terrorist attack settlement payment included in the federal
9 adjusted gross income of the estate of a victim of the September
10 11 terrorist attack or a trust to the extent the trust benefits a victim
11 of the September 11 terrorist attack.
12 (3) Add or subtract the amount necessary to make the adjusted
13 gross income of any taxpayer that owns property for which bonus
14 depreciation was allowed in the current taxable year or in an
15 earlier taxable year equal to the amount of adjusted gross income
16 that would have been computed had an election not been made
17 under Section 168(k) of the Internal Revenue Code to apply bonus
18 depreciation to the property in the year that it was placed in
19 service.
20 (4) Add an amount equal to any deduction allowed under Section
21 172 of the Internal Revenue Code (concerning net operating
22 losses).
23 (5) Add or subtract the amount necessary to make the adjusted
24 gross income of any taxpayer that placed Section 179 property (as
25 defined in Section 179 of the Internal Revenue Code) in service
26 in the current taxable year or in an earlier taxable year equal to
27 the amount of adjusted gross income that would have been
28 computed had an election for federal income tax purposes not
29 been made for the year in which the property was placed in
30 service to take deductions under Section 179 of the Internal
31 Revenue Code in a total amount exceeding the sum of:
32 (A) twenty-five thousand dollars ($25,000) to the extent
33 deductions under Section 179 of the Internal Revenue Code
34 were not elected as provided in clause (B); and
35 (B) for taxable years beginning after December 31, 2017, the
36 deductions elected under Section 179 of the Internal Revenue
37 Code on property acquired in an exchange if:
38 (i) the exchange would have been eligible for
39 nonrecognition of gain or loss under Section 1031 of the
40 Internal Revenue Code in effect on January 1, 2017;
41 (ii) the exchange is not eligible for nonrecognition of gain or
42 loss under Section 1031 of the Internal Revenue Code; and
2024 IN 1388—LS 6710/DI 119 24
1 (iii) the taxpayer made an election to take deductions under
2 Section 179 of the Internal Revenue Code with regard to the
3 acquired property in the year that the property was placed
4 into service.
5 The amount of deductions allowable for an item of property
6 under this clause may not exceed the amount of adjusted gross
7 income realized on the property that would have been deferred
8 under the Internal Revenue Code in effect on January 1, 2017.
9 (6) Subtract income that is:
10 (A) exempt from taxation under IC 6-3-2-21.7 (certain income
11 derived from patents); and
12 (B) included in the taxpayer's taxable income under the
13 Internal Revenue Code.
14 (7) Add an amount equal to any income not included in gross
15 income as a result of the deferral of income arising from business
16 indebtedness discharged in connection with the reacquisition after
17 December 31, 2008, and before January 1, 2011, of an applicable
18 debt instrument, as provided in Section 108(i) of the Internal
19 Revenue Code. Subtract from the adjusted gross income of any
20 taxpayer that added an amount to adjusted gross income in a
21 previous year the amount necessary to offset the amount included
22 in federal gross income as a result of the deferral of income
23 arising from business indebtedness discharged in connection with
24 the reacquisition after December 31, 2008, and before January 1,
25 2011, of an applicable debt instrument, as provided in Section
26 108(i) of the Internal Revenue Code.
27 (8) Add the amount excluded from federal gross income under
28 Section 103 of the Internal Revenue Code for interest received on
29 an obligation of a state other than Indiana, or a political
30 subdivision of such a state, that is acquired by the taxpayer after
31 December 31, 2011. For purposes of this subdivision:
32 (A) if the taxpayer receives interest from a pass through entity,
33 a regulated investment company, a hedge fund, or similar
34 arrangement, the taxpayer will be considered to have
35 acquired the obligation on the date the entity acquired the
36 obligation;
37 (B) if ownership of the obligation occurs by means other than
38 a purchase, the date of acquisition of the obligation shall be
39 the date ownership of the obligation was transferred, except
40 to the extent provided in clause (A), and if a portion of the
41 obligation is acquired on multiple dates, the date of
42 acquisition shall be considered separately for each portion of
2024 IN 1388—LS 6710/DI 119 25
1 the obligation; and
2 (C) if ownership of the obligation occurred as the result of a
3 refinancing of another obligation, the acquisition date shall be
4 the date on which the obligation was refinanced.
5 (9) For taxable years beginning after December 25, 2016, add an
6 amount equal to:
7 (A) the amount reported by the taxpayer on IRC 965
8 Transition Tax Statement, line 1;
9 (B) if the taxpayer deducted an amount under Section 965(c)
10 of the Internal Revenue Code in determining the taxpayer's
11 taxable income for purposes of the federal income tax, the
12 amount deducted under Section 965(c) of the Internal Revenue
13 Code; and
14 (C) with regard to any amounts of income under Section 965
15 of the Internal Revenue Code distributed by the taxpayer, the
16 deduction under Section 965(c) of the Internal Revenue Code
17 attributable to such distributed amounts and not reported to the
18 beneficiary.
19 For purposes of this article, the amount required to be added back
20 under clause (B) is not considered to be distributed or
21 distributable to a beneficiary of the estate or trust for purposes of
22 Sections 651 and 661 of the Internal Revenue Code.
23 (10) Subtract any interest expense paid or accrued in the current
24 taxable year but not deducted as a result of the limitation imposed
25 under Section 163(j)(1) of the Internal Revenue Code. Add any
26 interest expense paid or accrued in a previous taxable year but
27 allowed as a deduction under Section 163 of the Internal Revenue
28 Code in the current taxable year. For purposes of this subdivision,
29 an interest expense is considered paid or accrued only in the first
30 taxable year the deduction would have been allowable under
31 Section 163 of the Internal Revenue Code if the limitation under
32 Section 163(j)(1) of the Internal Revenue Code did not exist.
33 (11) Add an amount equal to the deduction for qualified business
34 income that was claimed by the taxpayer for the taxable year
35 under Section 199A of the Internal Revenue Code.
36 (12) Subtract the amount that would have been excluded from
37 gross income but for the enactment of Section 118(b)(2) of the
38 Internal Revenue Code for taxable years ending after December
39 22, 2017.
40 (13) Add an amount equal to the remainder of:
41 (A) the amount allowable as a deduction under Section 274(n)
42 of the Internal Revenue Code; minus
2024 IN 1388—LS 6710/DI 119 26
1 (B) the amount otherwise allowable as a deduction under
2 Section 274(n) of the Internal Revenue Code, if Section
3 274(n)(2)(D) of the Internal Revenue Code was not in effect
4 for amounts paid or incurred after December 31, 2020.
5 (14) For taxable years beginning after December 31, 2017, and
6 before January 1, 2021, add an amount equal to the excess
7 business loss of the taxpayer as defined in Section 461(l)(3) of the
8 Internal Revenue Code. In addition:
9 (A) If a taxpayer has an excess business loss under this
10 subdivision and also has modifications under subdivisions (3)
11 and (5) for property placed in service during the taxable year,
12 the taxpayer shall treat a portion of the taxable year
13 modifications for that property as occurring in the taxable year
14 the property is placed in service and a portion of the
15 modifications as occurring in the immediately following
16 taxable year.
17 (B) The portion of the modifications under subdivisions (3)
18 and (5) for property placed in service during the taxable year
19 treated as occurring in the taxable year in which the property
20 is placed in service equals:
21 (i) the modification for the property otherwise determined
22 under this section; minus
23 (ii) the excess business loss disallowed under this
24 subdivision;
25 but not less than zero (0).
26 (C) The portion of the modifications under subdivisions (3)
27 and (5) for property placed in service during the taxable year
28 treated as occurring in the taxable year immediately following
29 the taxable year in which the property is placed in service
30 equals the modification for the property otherwise determined
31 under this section minus the amount in clause (B).
32 (D) Any reallocation of modifications between taxable years
33 under clauses (B) and (C) shall be first allocated to the
34 modification under subdivision (3), then to the modification
35 under subdivision (5).
36 (15) For taxable years ending after March 12, 2020, subtract an
37 amount equal to the deduction disallowed pursuant to:
38 (A) Section 2301(e) of the CARES Act (Public Law 116-136),
39 as modified by Sections 206 and 207 of the Taxpayer Certainty
40 and Disaster Relief Tax Act (Division EE of Public Law
41 116-260); and
42 (B) Section 3134(e) of the Internal Revenue Code.
2024 IN 1388—LS 6710/DI 119 27
1 (16) For taxable years beginning after December 31, 2022,
2 subtract an amount equal to the deduction disallowed under
3 Section 280C(h) of the Internal Revenue Code.
4 (17) Except as provided in subsection (c), for taxable years
5 beginning after December 31, 2022, add an amount equal to any
6 deduction or deductions allowed or allowable in determining
7 taxable income under Section 641(b) of the Internal Revenue
8 Code for taxes based on or measured by income and levied at the
9 state level by any state of the United States.
10 (18) For taxable years beginning after December 31, 2021, add
11 or subtract amounts related to specified research or experimental
12 procedures as required under IC 6-3-2-29.
13 (19) Subtract the amount of short term or long term capital
14 gain that is attributable to the sale or exchange of one (1) or
15 more digital assets in a transaction and that is included in
16 federal adjusted gross income, not to exceed:
17 (A) for taxable years beginning after December 31, 2023,
18 and before January 1, 2025, two hundred dollars ($200)
19 per transaction; and
20 (B) for taxable years beginning after December 31, 2024,
21 an amount per transaction equal to the maximum
22 deduction allowed under this subdivision in the
23 immediately preceding calendar year adjusted by the
24 annual percentage change in the Consumer Price Index for
25 All Urban Consumers published by the federal Bureau of
26 Labor Statistics for the immediately preceding calendar
27 year.
28 (18) (19) (20) Add or subtract any other amounts the taxpayer is:
29 (A) required to add or subtract; or
30 (B) entitled to deduct;
31 under IC 6-3-2.
32 (g) For purposes of IC 6-3-2.1, IC 6-3-4-12, IC 6-3-4-13, and
33 IC 6-3-4-15 for taxable years beginning after December 31, 2022,
34 "adjusted gross income" of a pass through entity means the aggregate
35 of items of ordinary income and loss in the case of a partnership or a
36 corporation described in IC 6-3-2-2.8(2), or aggregate distributable net
37 income of a trust or estate as defined in Section 643 of the Internal
38 Revenue Code, distributions subject to tax for state and federal income
39 tax for beneficiaries in the case of a trust or estate, whichever is
40 applicable, for the taxable year modified as follows:
41 (1) Add the separately stated items of income and gains, or the
42 equivalent items that must be considered separately by a
2024 IN 1388—LS 6710/DI 119 28
1 beneficiary, as determined for federal purposes, attributed to the
2 partners, shareholders, or beneficiaries of the pass through entity,
3 determined without regard to whether the owner is permitted to
4 exclude all or part of the income or gain or deduct any amount
5 against the income or gain.
6 (2) Subtract the separately stated items of deductions or losses or
7 items that must be considered separately by beneficiaries, as
8 determined for federal purposes, attributed to partners,
9 shareholders, or beneficiaries of the pass through entity and that
10 are deductible by an individual in determining adjusted gross
11 income as defined under Section 62 of the Internal Revenue
12 Code:
13 (A) limited as if the partners, shareholders, and beneficiaries
14 deducted the maximum allowable loss or deduction allowable
15 for the taxable year prior to any amount deductible from the
16 pass through entity; but
17 (B) not considering any disallowance of deductions resulting
18 from federal basis limitations for the partner, shareholder, or
19 beneficiary.
20 (3) Add or subtract any modifications to adjusted gross income
21 that would be required both for individuals under subsection (a)
22 and corporations under subsection (b) to the extent otherwise
23 provided in those subsections, including amounts that are
24 allowable for which such modifications are necessary to account
25 for separately stated items in subdivision (1) or (2).
26 (h) Subsections (a)(35), (b)(20), (d)(19), (e)(19), or (f)(18) (a)(36),
27 (b)(22), (d)(20), (e)(20), or (f)(19) (a)(37), (b)(23), (d)(21), (e)(21), or
28 (f)(20) may not be construed to require an add back or allow a
29 deduction or exemption more than once for a particular add back,
30 deduction, or exemption.
31 (i) For taxable years beginning after December 25, 2016, if:
32 (1) a taxpayer is a shareholder, either directly or indirectly, in a
33 corporation that is an E&P deficit foreign corporation as defined
34 in Section 965(b)(3)(B) of the Internal Revenue Code, and the
35 earnings and profit deficit, or a portion of the earnings and profit
36 deficit, of the E&P deficit foreign corporation is permitted to
37 reduce the federal adjusted gross income or federal taxable
38 income of the taxpayer, the deficit, or the portion of the deficit,
39 shall also reduce the amount taxable under this section to the
40 extent permitted under the Internal Revenue Code, however, in no
41 case shall this permit a reduction in the amount taxable under
42 Section 965 of the Internal Revenue Code for purposes of this
2024 IN 1388—LS 6710/DI 119 29
1 section to be less than zero (0); and
2 (2) the Internal Revenue Service issues guidance that such an
3 income or deduction is not reported directly on a federal tax
4 return or is to be reported in a manner different than specified in
5 this section, this section shall be construed as if federal adjusted
6 gross income or federal taxable income included the income or
7 deduction.
8 (j) If a partner is required to include an item of income, a deduction,
9 or another tax attribute in the partner's adjusted gross income tax return
10 pursuant to IC 6-3-4.5, such item shall be considered to be includible
11 in the partner's federal adjusted gross income or federal taxable
12 income, regardless of whether such item is actually required to be
13 reported by the partner for federal income tax purposes. For purposes
14 of this subsection:
15 (1) items for which a valid election is made under IC 6-3-4.5-6,
16 IC 6-3-4.5-8, or IC 6-3-4.5-9 shall not be required to be included
17 in the partner's adjusted gross income or taxable income; and
18 (2) items for which the partnership did not make an election under
19 IC 6-3-4.5-6, IC 6-3-4.5-8, or IC 6-3-4.5-9, but for which the
20 partnership is required to remit tax pursuant to IC 6-3-4.5-18,
21 shall be included in the partner's adjusted gross income or taxable
22 income.
23 (k) The following apply for purposes of this section:
24 (1) For purposes of subsections (b) and (f), if a taxpayer is an
25 organization that has more than one (1) trade or business subject
26 to the provisions of Section 512(a)(6) of the Internal Revenue
27 Code, the following rules apply for taxable years beginning after
28 December 31, 2017:
29 (A) If a trade or business has federal unrelated business
30 taxable income of zero (0) or greater for a taxable year, the
31 unrelated business taxable income and modifications required
32 under this section shall be combined in determining the
33 adjusted gross income of the taxpayer and shall not be treated
34 as being subject to the provisions of Section 512(a)(6) of the
35 Internal Revenue Code if one (1) or more trades or businesses
36 have negative Indiana adjusted gross income after
37 adjustments.
38 (B) If a trade or business has federal unrelated business
39 taxable income of less than zero (0) for a taxable year, the
40 taxpayer shall apply the modifications under this section for
41 the taxable year against the net operating loss in the manner
42 required under IC 6-3-2-2.5 and IC 6-3-2-2.6 for separately
2024 IN 1388—LS 6710/DI 119 30
1 stated net operating losses. However, if the application of
2 modifications required under IC 6-3-2-2.5 or IC 6-3-2-2.6
3 results in the separately stated net operating loss for the trade
4 or business being zero (0), the modifications that increase
5 adjusted gross income under this section and remain after the
6 calculations to adjust the separately stated net operating loss
7 to zero (0) that result from the trade or business must be
8 treated as modifications to which clause (A) applies for the
9 taxable year.
10 (C) If a trade or business otherwise described in Section
11 512(a)(6) of the Internal Revenue Code incurred a net
12 operating loss for a taxable year beginning after December
13 31, 2017, and before January 1, 2021, and the net operating
14 loss was carried back for federal tax purposes:
15 (i) if the loss was carried back to a taxable year for which
16 the requirements under Section 512(a)(6) of the Internal
17 Revenue Code did not apply, the portion of the loss and
18 modifications attributable to the loss shall be treated as
19 adjusted gross income of the taxpayer for the first taxable
20 year of the taxpayer beginning after December 31, 2022,
21 and shall be treated as part of the adjusted gross income
22 attributable to clause (A), unless, and to the extent, the loss
23 and modifications were applied to adjusted gross income for
24 a previous taxable year, as determined under this article;
25 and
26 (ii) if the loss was carried back to a taxable year for which
27 the requirements under Section 512(a)(6) of the Internal
28 Revenue Code applied, the portion of the loss and
29 modifications attributable to the loss shall be treated as
30 adjusted gross income of the taxpayer for the first taxable
31 year of the taxpayer beginning after December 31, 2022,
32 and for purposes of this clause, the inclusion of losses and
33 modifications shall be in the same manner as provided in
34 clause (B), unless, and to the extent, the loss and
35 modifications were applied to adjusted gross income for a
36 previous taxable year, as determined under this article.
37 (D) Notwithstanding any provision in this subdivision, if a
38 taxpayer computed its adjusted gross income for a taxable
39 year beginning before January 1, 2023, based on a reasonable
40 interpretation of this article, the taxpayer shall be permitted
41 to compute its adjusted gross income for those taxable years
42 based on that interpretation. However, a taxpayer must
2024 IN 1388—LS 6710/DI 119 31
1 continue to report any tax attributes for taxable years
2 beginning after December 31, 2022, in a manner consistent
3 with its previous interpretation.
4 (2) In the case of a corporation, other than a captive real estate
5 investment trust, for which the adjusted gross income under this
6 article is determined after a deduction for dividends paid under
7 the Internal Revenue Code, the modifications required under this
8 section shall be applied in ratio to the corporation's taxable
9 income (as defined in Section 63 of the Internal Revenue Code)
10 after deductions for dividends paid under the Internal Revenue
11 Code compared to the corporation's taxable income (as defined
12 in Section 63 of the Internal Revenue Code) before the deduction
13 for dividends paid under the Internal Revenue Code.
14 (3) In the case of a trust or estate, the trust or estate is required
15 to include only the portion of the modifications not passed
16 through to beneficiaries.
17 (4) In the case of a taxpayer for which modifications are required
18 to be applied against a separately stated net operating loss under
19 IC 6-3-2-2.5 or IC 6-3-2-2.6, the modifications required under
20 this section must be adjusted to reflect the required application
21 of the modifications against a separately stated net operating
22 loss, in order to avoid the application of a particular
23 modification multiple times.
24 SECTION 2. IC 6-3-1-4.2 IS ADDED TO THE INDIANA CODE
25 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
26 JANUARY 1, 2024 (RETROACTIVE)]: Sec. 4.2. "Digital asset"
27 means:
28 (1) virtual currency;
29 (2) cryptocurrencies;
30 (3) natively electronic assets, including stablecoins and
31 nonfungible tokens; and
32 (4) other digital only assets that confer economic, proprietary,
33 or access rights or powers.
34 SECTION 3. IC 6-3-2-2.5, AS AMENDED BY P.L.194-2023,
35 SECTION 12, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
36 JANUARY 1, 2024 (RETROACTIVE)]: Sec. 2.5. (a) This section
37 applies to a resident person.
38 (b) Resident persons are entitled to a net operating loss deduction.
39 The amount of the deduction taken in a taxable year may not exceed
40 the taxpayer's unused Indiana net operating losses carried over to that
41 year. A taxpayer is not entitled to carryback any net operating losses
42 after December 31, 2011.
2024 IN 1388—LS 6710/DI 119 32
1 (c) An Indiana net operating loss equals the sum of the following:
2 (1) Subject to subsection (j), any separately stated net operating
3 loss, plus each of the following, as applicable:
4 (A) In the case of an individual, any deductions allowable in
5 determining the separately stated net operating loss for the
6 taxable year, but not allowable in determining federal adjusted
7 gross income.
8 (B) In the case of a separately stated net operating loss that
9 results from an excess business loss (as defined in Section
10 461(l) of the Internal Revenue Code) for a taxable year
11 beginning after December 31, 2022, the modifications
12 required by IC 6-3-1-3.5, as set forth in subsection (d), that
13 result in an increase of the taxpayer's Indiana adjusted gross
14 income and that arise from federal deductions that resulted in
15 the excess business loss.
16 (C) In the case of a separately stated net operating loss not
17 described in clause (B), the modifications required by
18 IC 6-3-1-3.5, as set forth in subsection (d). For purposes of this
19 clause, a modification that results in an increase to a taxpayer's
20 adjusted gross income is considered an addition, and a
21 modification that results in a decrease to a taxpayer's adjusted
22 gross income is considered a subtraction.
23 If the amount determined under this subdivision is less than zero
24 (0), the amount is an Indiana net operating loss.
25 (2) Subject to subsection (j), the taxpayer's preliminary federal net
26 operating loss for a taxable year plus the sum of the following:
27 (A) The application of certain modifications required by
28 IC 6-3-1-3.5 as set forth in subsection (d). For purposes of this
29 clause, a modification that results in an increase to a taxpayer's
30 adjusted gross income is considered an addition, and a
31 modification that results in a decrease to a taxpayer's adjusted
32 gross income is considered a subtraction.
33 (B) In the case of an individual, any deductions allowable in
34 determining the preliminary federal net operating loss for the
35 taxable year, but not allowable in determining federal adjusted
36 gross income.
37 If the amount determined under this subdivision is less than zero
38 (0), the amount is an Indiana net operating loss. If the amount
39 determined under this subdivision is equal to or greater than zero
40 (0), the Indiana net operating loss under this subdivision is zero
41 (0).
42 (3) The excess business loss deduction disallowed under
2024 IN 1388—LS 6710/DI 119 33
1 IC 6-3-1-3.5(a)(29) and IC 6-3-1-3.5(f)(14).
2 (d) For purposes of subsection (c), the modifications that are to be
3 applied are those modifications required under IC 6-3-1-3.5 for the
4 same taxable year in which each net operating loss was incurred,
5 except that the modifications do not include the modifications required
6 under:
7 (1) IC 6-3-1-3.5(a)(3);
8 (2) IC 6-3-1-3.5(a)(4);
9 (3) IC 6-3-1-3.5(a)(5);
10 (4) IC 6-3-1-3.5(a)(36); IC 6-3-1-3.5(a)(37);
11 (5) IC 6-3-1-3.5(f)(19); IC 6-3-1-3.5(f)(20); and
12 (6) any modification required under Section 172(d) or Section
13 512(b) of the Internal Revenue Code that is also required under
14 IC 6-3-1-3.5 in determining Indiana adjusted gross income.
15 (e) Subject to the limitations contained in subsections (g), (h), and
16 (i), an Indiana net operating loss carryover shall be available as a
17 deduction from the taxpayer's adjusted gross income (as defined in
18 IC 6-3-1-3.5) in the carryover year provided in subsection (f), but not
19 in excess of the taxpayer's adjusted gross income (as defined in
20 IC 6-3-1-3.5) in the carryover year determined without regard to this
21 section.
22 (f) Carryovers shall be determined under this subsection as follows:
23 (1) An Indiana net operating loss shall be an Indiana net operating
24 loss carryover to each of the carryover years following the taxable
25 year of the loss.
26 (2) An Indiana net operating loss may not be carried over for
27 more than twenty (20) taxable years after the taxable year of the
28 loss.
29 (g) Except as provided in subsection (h), the entire amount of the
30 Indiana net operating loss for any taxable year shall be carried to the
31 earliest of the taxable years to which (as determined under subsection
32 (f)) the loss may be carried. The amount of the Indiana net operating
33 loss remaining after the deduction is taken under this section in a
34 taxable year may be carried over as provided in subsection (f). The
35 amount of the Indiana net operating loss carried over from year to year
36 shall be reduced to the extent that the Indiana net operating loss
37 carryover is used by the taxpayer to obtain a deduction in a taxable
38 year, or as required by subsection (i), until the occurrence of the earlier
39 of the following:
40 (1) The entire amount of the Indiana net operating loss has been
41 used as a deduction or reduced as required by subsection (i).
42 (2) The Indiana net operating loss has been carried over to each
2024 IN 1388—LS 6710/DI 119 34
1 of the carryover years provided by subsection (f).
2 (h) An Indiana net operating loss that arises after the application of
3 Section 512(a)(6) of the Internal Revenue Code shall be allowable
4 only:
5 (1) in a taxable year in which the trade or business that generated
6 the federal net operating loss has an adjusted gross income greater
7 than zero (0) as determined under IC 6-3-1-3.5; and
8 (2) against the trade's or business's adjusted gross income;
9 until the federal net operating loss from the trade or business has been
10 exhausted. When the federal net operating loss from the trade or
11 business has been exhausted, and subject to the limitations of this
12 section, any remaining Indiana net operating loss shall be allowable
13 against any trade or business of the taxpayer.
14 (i) The following rules apply to an Indiana net operating loss:
15 (1) If the taxpayer had a discharge of indebtedness that is
16 excluded from gross income under Section 108(a)(1)(A), Section
17 108(a)(1)(B), or Section 108(a)(1)(C) of the Internal Revenue
18 Code, the Indiana net operating loss shall be reduced by the
19 remainder of:
20 (A) the amount of discharge of indebtedness excluded from
21 federal gross income; minus
22 (B) the amount of discharge of indebtedness that reduced the
23 tax attributes under Section 108(b)(2)(D), Section
24 108(b)(2)(E), or Section 108(b)(2)(F) of the Internal Revenue
25 Code or was applied for federal tax purposes under Section
26 108(b)(5) of the Internal Revenue Code.
27 (2) Any reduction in an Indiana net operating loss shall be first
28 applied to the Indiana net operating loss for the taxable year of the
29 discharge, and then to any Indiana net operating loss carryovers.
30 (3) The provisions of Section 108(d)(6) and Section 108(d)(7) of
31 the Internal Revenue Code shall apply to any discharge of
32 indebtedness for purposes of determining the reduction of net
33 operating losses under this section.
34 (j) The following apply for purposes of calculating an Indiana net
35 operating loss under subsection (c):
36 (1) An itemized deduction shall be applied first under subsection
37 (c)(1), and any amount not applied under subsection (c)(1) to
38 make the net operating loss equal to zero (0) shall be applied
39 under subsection (c)(2).
40 (2) In the case of a modification under IC 6-3-1-3.5 required to
41 modify a separately stated net operating loss or a preliminary
42 federal net operating loss, the amount of the modification may not
2024 IN 1388—LS 6710/DI 119 35
1 exceed the amount prescribed under IC 6-3-1-3.5 and must be
2 applied in the following order:
3 (A) Against a separately stated net operating loss under
4 subsection (c)(1)(B), but only to the extent necessary to
5 increase the separately stated net operating loss, after
6 application of subsection (c)(1)(A) and (c)(1)(B), to an amount
7 not greater than zero (0).
8 (B) Against a separately stated net operating loss under
9 subsection (c)(1)(C), but only to the extent necessary to
10 increase the separately stated net operating loss to an amount
11 not greater than zero (0).
12 (C) To compute a modification to a preliminary federal net
13 operating loss under subsection (c)(2).
14 SECTION 4. IC 6-3-2-2.6, AS AMENDED BY P.L.194-2023,
15 SECTION 13, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
16 JANUARY 1, 2024 (RETROACTIVE)]: Sec. 2.6. (a) This section
17 applies to a corporation or a nonresident person.
18 (b) Corporations and nonresident persons are entitled to a net
19 operating loss deduction. The amount of the deduction taken in a
20 taxable year may not exceed the taxpayer's unused Indiana net
21 operating losses carried over to that year. A taxpayer is not entitled to
22 carryback any net operating losses after December 31, 2011.
23 (c) An Indiana net operating loss equals the sum of the following:
24 (1) Subject to subsection (m), any separately stated net operating
25 loss derived from sources within Indiana, plus each of the
26 following, as applicable:
27 (A) In the case of an individual, any deductions allowable in
28 determining the separately stated net operating loss for the
29 taxable year that are derived from sources within Indiana but
30 not allowable in determining federal adjusted gross income.
31 (B) In the case of a separately stated net operating loss that
32 results from an excess business loss (as defined in Section
33 461(l) of the Internal Revenue Code) for a taxable year
34 beginning after December 31, 2022, the modifications
35 required by IC 6-3-1-3.5, as set forth in subsection (d)(1), that
36 result in an increase of the taxpayer's Indiana adjusted gross
37 income and that arise from federal deductions that resulted in
38 the excess business loss.
39 (C) In the case of a separately stated net operating loss not
40 described in clause (B), the modifications required by
41 IC 6-3-1-3.5, as set forth in subsection (d)(1). For purposes of
42 this clause, a modification that results in an increase to a
2024 IN 1388—LS 6710/DI 119 36
1 taxpayer's adjusted gross income is considered an addition,
2 and a modification that results in a decrease to a taxpayer's
3 adjusted gross income is considered a subtraction.
4 If the amount determined under this subdivision is less than zero
5 (0), the amount is an Indiana net operating loss.
6 (2) Subject to subsection (m), the taxpayer's preliminary federal
7 net operating loss for a taxable year derived from sources within
8 Indiana plus the sum of the following:
9 (A) The application of certain modifications required by
10 IC 6-3-1-3.5 as set forth in subsection (d)(1). For purposes of
11 this clause, a modification that results in an increase to a
12 taxpayer's adjusted gross income is considered an addition,
13 and a modification that results in a decrease to a taxpayer's
14 adjusted gross income is considered a subtraction.
15 (B) In the case of an individual, any deductions derived from
16 sources within Indiana and allowable in determining the
17 preliminary federal net operating loss for the taxable year but
18 not allowable in determining federal adjusted gross income.
19 If the amount determined under this subdivision is less than zero
20 (0), the amount is an Indiana net operating loss. If the amount
21 determined under this subdivision is equal to or greater than zero
22 (0), the Indiana net operating loss under this subdivision is zero
23 (0).
24 (3) The excess business loss deduction disallowed under
25 IC 6-3-1-3.5(a)(29) and IC 6-3-1-3.5(f)(14) and incurred from
26 Indiana sources.
27 (d) The following provisions apply for purposes of subsection (c):
28 (1) The modifications that are to be applied are those
29 modifications required under IC 6-3-1-3.5 for the same taxable
30 year in which each net operating loss was incurred, except that the
31 modifications do not include the modifications required under:
32 (A) IC 6-3-1-3.5(a)(3);
33 (B) IC 6-3-1-3.5(a)(4);
34 (C) IC 6-3-1-3.5(a)(5);
35 (D) IC 6-3-1-3.5(a)(36); IC 6-3-1-3.5(a)(37);
36 (E) IC 6-3-1-3.5(b)(22); IC 6-3-1-3.5(b)(23);
37 (F) IC 6-3-1-3.5(d)(20); IC 6-3-1-3.5(d)(21);
38 (G) IC 6-3-1-3.5(e)(20); IC 6-3-1-3.5(e)(21);
39 (H) IC 6-3-1-3.5(f)(19); IC 6-3-1-3.5(f)(20); and
40 (I) any modification required under Section 172(d) or Section
41 512(b) of the Internal Revenue Code that is also required
42 under IC 6-3-1-3.5 in determining Indiana adjusted gross
2024 IN 1388—LS 6710/DI 119 37
1 income.
2 (2) The amount of the taxpayer's net operating loss that is derived
3 from sources within Indiana shall be determined in the same
4 manner that the amount of the taxpayer's adjusted gross income
5 derived from sources within Indiana is determined under section
6 2 of this chapter for the same taxable year during which each loss
7 was incurred.
8 (e) Subject to the limitations contained in subsections (g) through
9 (l), an Indiana net operating loss carryover shall be available as a
10 deduction from the taxpayer's adjusted gross income derived from
11 sources within Indiana (as defined in section 2 of this chapter) in the
12 carryover year provided in subsection (f), but not in excess of the
13 taxpayer's adjusted gross income (as defined in IC 6-3-1-3.5) in the
14 carryover year determined without regard to the deduction allowable
15 under this section.
16 (f) Carryovers shall be determined under this subsection as follows:
17 (1) An Indiana net operating loss shall be an Indiana net operating
18 loss carryover to each of the carryover years following the taxable
19 year of the loss.
20 (2) An Indiana net operating loss may not be carried over for
21 more than twenty (20) taxable years after the taxable year of the
22 loss.
23 (g) The entire amount of the Indiana net operating loss for any
24 taxable year shall be carried to the earliest of the taxable years to which
25 (as determined under subsection (f)) the loss may be carried. The
26 amount of the Indiana net operating loss remaining after the deduction
27 is taken under this section in a taxable year may be carried over as
28 provided in subsection (f). The amount of the Indiana net operating loss
29 carried over from year to year shall be reduced to the extent that the
30 Indiana net operating loss carryover is used by the taxpayer to obtain
31 a deduction in a taxable year, or as required by subsection (i), until the
32 occurrence of the earlier of the following:
33 (1) The entire amount of the Indiana net operating loss has been
34 used as a deduction or reduced as required by subsection (i).
35 (2) The Indiana net operating loss has been carried over to each
36 of the carryover years provided by subsection (f).
37 (h) An Indiana net operating loss deduction determined under this
38 section shall be allowed notwithstanding the fact that in the year the
39 taxpayer incurred the net operating loss the taxpayer was not subject to
40 the tax imposed under section 1 of this chapter because the taxpayer
41 was:
42 (1) a life insurance company (as defined in Section 816(a) of the
2024 IN 1388—LS 6710/DI 119 38
1 Internal Revenue Code); or
2 (2) an insurance company subject to tax under Section 831 of the
3 Internal Revenue Code.
4 (i) Notwithstanding subsection (g), the following apply to an Indiana
5 net operating loss:
6 (1) An Indiana net operating loss that arises after the application
7 of Section 512(a)(6) of the Internal Revenue Code shall be
8 allowable only:
9 (A) in a taxable year in which the trade or business that
10 generated the federal net operating loss has an adjusted gross
11 income derived from sources within Indiana greater than zero
12 (0) as determined under IC 6-3-1-3.5; and
13 (B) against the trade's or business's adjusted gross income;
14 until the federal net operating loss from the trade or business has
15 been exhausted. When the federal net operating loss from the
16 trade or business has been exhausted, and subject to the
17 limitations of this section, any remaining Indiana net operating
18 loss shall be allowable against any trade or business of the
19 taxpayer.
20 (2) In the case of a corporation described in section 2.8(2) of this
21 chapter, an Indiana net operating loss deduction that is
22 attributable to a preconversion year may not be greater than any
23 net recognized built-in gain of the corporation as defined in
24 Section 1374(d)(2) of the Internal Revenue Code derived from
25 sources within Indiana.
26 (j) The following rules apply to an Indiana net operating loss:
27 (1) If the taxpayer had a discharge of indebtedness derived from
28 Indiana sources that is excluded from gross income under Section
29 108(a)(1)(A), Section 108(a)(1)(B), or Section 108(a)(1)(C) of the
30 Internal Revenue Code, the Indiana net operating loss shall be
31 reduced by the remainder of:
32 (A) the amount of discharge of indebtedness excluded from
33 federal gross income derived from Indiana sources; minus
34 (B) the amount of discharge of indebtedness derived from
35 Indiana sources that reduced the tax attributes under Section
36 108(b)(2)(D), Section 108(b)(2)(E), or Section 108(b)(2)(F) of
37 the Internal Revenue Code or was applied for federal tax
38 purposes under Section 108(b)(5) of the Internal Revenue
39 Code.
40 (2) Any reduction in an Indiana net operating loss shall be first
41 applied to the Indiana net operating loss for the taxable year of the
42 discharge, and then to any Indiana net operating loss carryovers.
2024 IN 1388—LS 6710/DI 119 39
1 (3) The provisions of Section 108(d)(6) and Section 108(d)(7) of
2 the Internal Revenue Code shall apply to any discharge of
3 indebtedness for purposes of determining the reduction of net
4 operating losses under this section.
5 (k) If a taxpayer has an ownership change for which the limitations
6 of net operating losses under Section 382 of the Internal Revenue Code
7 apply, the following shall apply:
8 (1) The amount a taxpayer may claim as an Indiana net operating
9 loss deduction for a taxable year beginning after December 31,
10 2022, shall not exceed the limitation imposed by Section
11 382(b)(1) of the Internal Revenue Code multiplied by the
12 apportionment percentage determined under section 2 of this
13 chapter for the year in which the net operating loss is being
14 claimed, unless otherwise provided by this subsection. The
15 following apply:
16 (A) The limitation under this subdivision does not apply to
17 adjusted gross income accrued in the portion of the taxable
18 year on or before the change date (as defined in Section 382(j)
19 of the Internal Revenue Code). For purposes of this
20 subdivision, the adjusted gross income of the taxpayer shall be
21 multiplied by the number of days in the taxable year on or
22 before the change date to the number of days in the taxable
23 year.
24 (B) For the portion of the taxable year after the change date (as
25 defined in Section 382(j) of the Internal Revenue Code), the
26 limitation under this subdivision shall be the limitation
27 otherwise computed in this subdivision multiplied by the
28 number of days in the taxable year after the change date to the
29 number of days in the taxable year.
30 (2) If a taxpayer's Indiana net operating loss determined under this
31 subsection is not fully deductible as a result of subsection (e) for
32 a taxable year, the limitation under this subsection for the
33 following taxable year shall be increased by the net operating loss
34 determined but not allowable as a deduction for the taxable year.
35 (3) If the continuity of business requirements under Section
36 382(c) of the Internal Revenue Code are not met, the Indiana net
37 operating loss available for carryforward shall be zero (0) except
38 to the extent of recognized built in gains derived from Indiana
39 sources and amounts allowable under subdivision (2).
40 (4) If the limitation under Section 382(b) of the Internal Revenue
41 Code is increased for a taxable year under Section 382(h) of the
42 Internal Revenue Code, the limitation under subdivision (1) for
2024 IN 1388—LS 6710/DI 119 40
1 that taxable year shall be increased by the federal increase in the
2 net operating loss limitation for the taxable year multiplied by the
3 Indiana apportionment percentage for that taxable year.
4 (5) For purposes of any other matters not provided for in
5 subdivisions (1) through (4), the taxpayer and the department are
6 required to apply the limitations and rules under Section 382 of
7 the Internal Revenue Code in a manner consistent with this
8 subsection.
9 (6) This subsection applies to a taxpayer regardless of whether the
10 taxpayer actually has a federal net operating loss subject to
11 Section 382 of the Internal Revenue Code or whether any federal
12 net operating losses have been exhausted.
13 (l) If two (2) or more corporations file a consolidated return under
14 IC 6-3-4-14 or a combined return under this chapter and have an
15 Indiana net operating loss on a consolidated or combined basis for a
16 taxable year:
17 (1) the Indiana net operating loss attributable to each corporation
18 included in the consolidated or combined return shall be
19 determined in a manner consistent with the attribution of federal
20 net operating losses for consolidated groups as provided under the
21 Internal Revenue Code and regulations promulgated thereunder;
22 (2) the application of Indiana net operating losses and reduction
23 of losses attributable to each member shall be in a manner
24 consistent with the application and reduction of federal net
25 operating losses for consolidated groups as provided under the
26 Internal Revenue Code and regulations promulgated thereunder;
27 and
28 (3) the availability of net operating losses to each corporation
29 upon an ownership change or change in filing status shall be in a
30 manner consistent with the availability and use of federal net
31 operating losses for consolidated groups as provided under the
32 Internal Revenue Code and regulations promulgated thereunder.
33 (m) The following apply for purposes of calculating an Indiana net
34 operating loss under subsection (c):
35 (1) An itemized deduction shall be applied first under subsection
36 (c)(1), and any amount not applied under subsection (c)(1) to
37 make the net operating loss equal to zero (0) shall be applied
38 under subsection (c)(2).
39 (2) In the case of a modification under IC 6-3-1-3.5 required to
40 modify a separately stated net operating loss or a preliminary
41 federal net operating loss, the amount of the modification may not
42 exceed the amount prescribed under IC 6-3-1-3.5 and must be
2024 IN 1388—LS 6710/DI 119 41
1 applied in the following order:
2 (A) Against a separately stated net operating loss under
3 subsection (c)(1)(B), but only to the extent necessary to
4 increase the separately stated net operating loss, after
5 application of subsection (c)(1)(A) and (c)(1)(B), to an amount
6 not greater than zero (0).
7 (B) Against a separately stated net operating loss under
8 subsection (c)(1)(C), but only to the extent necessary to
9 increase the separately stated net operating loss to an amount
10 not greater than zero (0).
11 (C) To compute a modification to a preliminary federal net
12 operating loss under subsection (c)(2).
13 SECTION 5. IC 6-3.5-12 IS ADDED TO THE INDIANA CODE
14 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
15 JULY 1, 2024]:
16 Chapter 12. Transactions Involving Digital Assets
17 Sec. 1. As used in this chapter, "digital asset" has the meaning
18 set forth in IC 6-3-1-4.2.
19 Sec. 2. (a) A county or municipality may not impose a tax that
20 is assessed based on use of a digital asset as payment in a
21 transaction.
22 (b) A county or municipality that imposes a tax on any form of
23 transaction may not impose the tax at a different rate based on the
24 use of a digital asset for payment in the transaction.
25 SECTION 6. IC 8-1-2-4.4 IS ADDED TO THE INDIANA CODE
26 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
27 1, 2024]: Sec. 4.4. (a) The following definitions apply throughout
28 this section:
29 (1) "Blockchain protocol" has the meaning set forth in
30 IC 34-30-34.5-2.
31 (2) "Digital asset mining business" means a person that uses
32 one (1) or more computers that consume a total amount of
33 electricity of more than one (1) megawatt for the purpose of
34 securing a blockchain protocol.
35 (3) "Electricity supplier" has the meaning set forth in
36 IC 8-1-2.3-2.
37 (b) The commission may not approve a rate schedule for
38 electricity supplied by an electricity supplier to digital asset mining
39 businesses that is unreasonable or unjustly discriminatory as
40 compared to the rate schedule approved by the commission for
41 electricity supplied by the electricity supplier to industrial
42 customers.
2024 IN 1388—LS 6710/DI 119 42
1 SECTION 7. IC 23-19-1-2, AS AMENDED BY P.L.158-2022,
2 SECTION 5, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
3 JULY 1, 2024]: Sec. 2. In this article, unless the context otherwise
4 requires:
5 (1) "Agent" means an individual, other than a broker-dealer, who
6 represents a broker-dealer in effecting or attempting to effect
7 purchases or sales of securities or represents an issuer in effecting
8 or attempting to effect purchases or sales of the issuer's securities.
9 However, a partner, officer, or director of a broker-dealer or
10 issuer, or an individual having a similar status or performing
11 similar functions is an agent only if the individual otherwise
12 comes within the term. The term does not include an individual
13 excluded by rule adopted or order issued under this article.
14 (2) "Bank" means:
15 (A) a banking institution organized under the laws of the
16 United States;
17 (B) a member bank of the Federal Reserve System;
18 (C) any other banking institution, whether incorporated or not,
19 doing business under the laws of a state or of the United
20 States, a substantial portion of the business of which consists
21 of receiving deposits or exercising fiduciary powers similar to
22 those permitted to be exercised by national banks under the
23 authority of the Comptroller of the Currency under Section 1
24 of Public Law 87-722 (12 U.S.C. 92a), and which is
25 supervised and examined by a state or federal agency having
26 supervision over banks, and which is not operated for the
27 purpose of evading this article; and
28 (D) a receiver, conservator, or other liquidating agent of any
29 institution or firm included in clause (A), (B), or (C).
30 (3) "Broker-dealer" means a person engaged in the business of
31 effecting transactions in securities for the account of others or for
32 the person's own account. The term does not include:
33 (A) an agent;
34 (B) an issuer;
35 (C) a bank, a savings institution, or a trust company that is a
36 wholly owned subsidiary of a bank or savings institution if its
37 activities as a broker-dealer are limited to those specified in
38 subsections 3(a)(4)(B)(i) through (vi), (viii) through (x), and
39 (xi) if limited to unsolicited transactions; 3(a)(5)(B); and
40 3(a)(5)(C) of the Securities Exchange Act of 1934 (15 U.S.C.
41 78c(a)(4) and 15 U.S.C. 78c(a)(5)) or a bank that satisfies the
42 conditions described in subsection 3(a)(4)(E) of the Securities
2024 IN 1388—LS 6710/DI 119 43
1 Exchange Act of 1934 (15 U.S.C. 78c(a)(4));
2 (D) an international banking institution; or
3 (E) a person excluded by rule adopted or order issued under
4 this article.
5 For the purposes of this subdivision, "effecting transactions
6 in securities" does not include providing, or offering to
7 provide, digital asset mining or staking as a service.
8 (4) "Commissioner" means the securities commissioner appointed
9 under IC 23-19-6-1(a).
10 (5) "Depository institution" means:
11 (A) a bank; or
12 (B) a savings institution, trust company, credit union, or
13 similar institution that is organized or chartered under the laws
14 of a state or of the United States, authorized to receive
15 deposits, and supervised and examined by an official or
16 agency of a state or the United States if its deposits or share
17 accounts are insured to the maximum amount authorized by
18 statute by the Federal Deposit Insurance Corporation, the
19 National Credit Union Share Insurance Fund, or a successor
20 authorized by federal law. The term does not include:
21 (i) an insurance company or other organization primarily
22 engaged in the business of insurance;
23 (ii) a Morris Plan bank; or
24 (iii) an industrial loan company that is not an insured
25 depository institution as defined in Section 3(c)(2) of the
26 Federal Deposit Insurance Act (12 U.S.C. 1813(c)(2)) or any
27 successor federal statute.
28 (6) "Digital asset mining" has the meaning set forth in
29 IC 34-30-34.5-3.
30 (6) (7) "Federal covered investment adviser" means a person
31 registered under the Investment Advisers Act of 1940.
32 (7) (8) "Federal covered security" means a security that is, or
33 upon completion of a transaction will be, a covered security under
34 Section 18(b) of the Securities Act of 1933 (15 U.S.C. 77r(b)) or
35 rules or regulations adopted under that provision.
36 (8) (9) "Filing" means the receipt under this article of a record by
37 the commissioner or a designee of the commissioner.
38 (9) (10) "Fraud", "fraudulent", "deceit", and "defraud" mean a
39 misrepresentation of a material fact, a promise, representation, or
40 prediction not made honestly or in good faith, or the failure to
41 disclose a material fact necessary in order to make the statements
42 made, in light of the circumstances under which they were made,
2024 IN 1388—LS 6710/DI 119 44
1 not misleading. This definition does not limit or diminish the full
2 meaning of the terms as applied by or defined in courts of law or
3 equity. The terms are not limited to common law deceit.
4 (10) (11) "Guaranteed" means guaranteed as to payment of all
5 principal, dividends, and interest.
6 (11) (12) "Institutional investor" means any of the following,
7 whether acting for itself or for others in a fiduciary capacity:
8 (A) a depository institution or international banking
9 institution;
10 (B) an insurance company;
11 (C) a separate account of an insurance company;
12 (D) an investment company as defined in the Investment
13 Company Act of 1940;
14 (E) a broker-dealer registered under the Securities Exchange
15 Act of 1934;
16 (F) an employee pension, profit-sharing, or benefit plan if the
17 plan has total assets in excess of ten million dollars
18 ($10,000,000) or its investment decisions are made by a
19 named fiduciary, as defined in the Employee Retirement
20 Income Security Act of 1974, that is a broker-dealer registered
21 under the Securities Exchange Act of 1934, an investment
22 adviser registered or exempt from registration under the
23 Investment Advisers Act of 1940, an investment adviser
24 registered under this article, a depository institution, or an
25 insurance company;
26 (G) a plan established and maintained by a state, a political
27 subdivision of a state, or an agency or instrumentality of a state
28 or a political subdivision of a state for the benefit of its
29 employees, if the plan has total assets in excess of ten million
30 dollars ($10,000,000) or its investment decisions are made by
31 a duly designated public official or by a named fiduciary, as
32 defined in the Employee Retirement Income Security Act of
33 1974, that is a broker-dealer registered under the Securities
34 Exchange Act of 1934, an investment adviser registered or
35 exempt from registration under the Investment Advisers Act
36 of 1940, an investment adviser registered under this article, a
37 depository institution, or an insurance company;
38 (H) a trust, if it has total assets in excess of ten million dollars
39 ($10,000,000), its trustee is a depository institution, and its
40 participants are exclusively plans of the types identified in
41 clause (F) or (G), regardless of the size of their assets, except
42 a trust that includes as participants self-directed individual
2024 IN 1388—LS 6710/DI 119 45
1 retirement accounts or similar self-directed plans;
2 (I) an organization described in Section 501(c)(3) of the
3 Internal Revenue Code (26 U.S.C. 501(c)(3)), corporation,
4 Massachusetts trust or similar business trust, limited liability
5 company, or partnership, not formed for the specific purpose
6 of acquiring the securities offered, with total assets in excess
7 of ten million dollars ($10,000,000);
8 (J) a small business investment company licensed by the Small
9 Business Administration under Section 301(c) of the Small
10 Business Investment Act of 1958 (15 U.S.C. 681(c)) with total
11 assets in excess of ten million dollars ($10,000,000);
12 (K) a private business development company, as defined in
13 Section 202(a)(22) of the Investment Advisers Act of 1940 (15
14 U.S.C. 80b-2(a)(22)) with total assets in excess of ten million
15 dollars ($10,000,000);
16 (L) a federal covered investment adviser acting for its own
17 account;
18 (M) a "qualified institutional buyer", as defined in Rule
19 144A(a)(1), other than Rule 144A(a)(1)(i)(H), adopted under
20 the Securities Act of 1933 (17 CFR 230.144A);
21 (N) a "major U.S. institutional investor", as defined in Rule
22 15a-6(b)(4)(i) adopted under the Securities Exchange Act of
23 1934 (17 CFR 240.15a-6);
24 (O) any other person, other than an individual, of institutional
25 character with total assets in excess of ten million dollars
26 ($10,000,000) not organized for the specific purpose of
27 evading this article; or
28 (P) any other person specified by rule adopted or order issued
29 under this article.
30 (12) (13) "Insurance company" means a company organized as an
31 insurance company whose primary business is writing insurance
32 or reinsuring risks underwritten by insurance companies and
33 which is subject to supervision by the insurance commissioner or
34 a similar official or agency of a state.
35 (13) (14) "Insured" means insured as to payment of all principal
36 and all interest.
37 (14) (15) "International banking institution" means an
38 international financial institution of which the United States is a
39 member and whose securities are exempt from registration under
40 the Securities Act of 1933.
41 (15) (16) "Investment adviser" means a person that, for
42 compensation, engages in the business of advising others, either
2024 IN 1388—LS 6710/DI 119 46
1 directly or through publications or writings, as to the value of
2 securities or the advisability of investing in, purchasing, or selling
3 securities or that, for compensation and as a part of a regular
4 business, issues or promulgates analyses or reports concerning
5 securities. The term includes a financial planner or other person
6 that, as an integral component of other financially related
7 services, provides investment advice to others for compensation
8 as part of a business or that holds itself out as providing
9 investment advice to others for compensation. The term does not
10 include:
11 (A) an investment adviser representative;
12 (B) a lawyer, accountant, engineer, or teacher whose
13 performance of investment advice is solely incidental to the
14 practice of the person's profession;
15 (C) a broker-dealer or its agents whose performance of
16 investment advice is solely incidental to the conduct of
17 business as a broker-dealer and that does not receive special
18 compensation for the investment advice;
19 (D) a publisher of a bona fide newspaper, news magazine, or
20 business or financial publication of general and regular
21 circulation;
22 (E) a federal covered investment adviser;
23 (F) a bank, a savings institution, or a trust company that is a
24 wholly owned subsidiary of a bank or savings institution;
25 (G) any other person that is excluded by the Investment
26 Advisers Act of 1940 from the definition of investment
27 adviser; or
28 (H) any other person excluded by rule adopted or order issued
29 under this article.
30 (16) (17) "Investment adviser representative" means an individual
31 employed by or associated with an investment adviser or federal
32 covered investment adviser and who makes any recommendations
33 or otherwise gives investment advice regarding securities,
34 manages accounts or portfolios of clients, determines which
35 recommendation or advice regarding securities should be given,
36 provides investment advice or holds herself or himself out as
37 providing investment advice, or supervises employees who
38 perform any of the foregoing. The term does not include an
39 individual who:
40 (A) performs only clerical or ministerial acts;
41 (B) is an agent whose performance of investment advice is
42 solely incidental to the individual acting as an agent and who
2024 IN 1388—LS 6710/DI 119 47
1 does not receive special compensation for investment advisory
2 services;
3 (C) is employed by or associated with a federal covered
4 investment adviser, unless the individual has a "place of
5 business" in this state, as that term is defined by rule adopted
6 under Section 203A of the Investment Advisers Act of 1940
7 (15 U.S.C. 80b-3a), and is:
8 (i) an "investment adviser representative", as that term is
9 defined by rule adopted under Section 203A of the
10 Investment Advisers Act of 1940 (15 U.S.C. 80b-3a); or
11 (ii) not a "supervised person", as that term is defined in
12 Section 202(a)(25) of the Investment Advisers Act of 1940
13 (15 U.S.C. 80b-2(a)(25)); or
14 (D) is excluded by rule adopted or order issued under this
15 article.
16 (17) (18) "Issuer" means a person that issues or proposes to issue
17 a security, subject to the following:
18 (A) The issuer of a voting trust certificate, collateral trust
19 certificate, certificate of deposit for a security, or share in an
20 investment company without a board of directors or
21 individuals performing similar functions is the person
22 performing the acts and assuming the duties of depositor or
23 manager under the trust or other agreement or instrument
24 under which the security is issued.
25 (B) The issuer of an equipment trust certificate or similar
26 security serving the same purpose is the person by which the
27 property is or will be used or to which the property or
28 equipment is or will be leased or conditionally sold or that is
29 otherwise contractually responsible for assuring payment of
30 the certificate.
31 (C) The issuer of a fractional undivided interest in an oil, gas,
32 or other mineral lease or in payments out of production under
33 a lease, right, or royalty is the owner of an interest in the lease
34 or in payments out of production under a lease, right, or
35 royalty, whether whole or fractional, that creates fractional
36 interests for the purpose of sale.
37 (18) (19) "Nonissuer transaction" or "nonissuer distribution"
38 means a transaction or distribution not directly or indirectly for
39 the benefit of the issuer.
40 (19) (20) "Offer to purchase" includes an attempt or offer to
41 obtain, or solicitation of an offer to sell, a security or interest in a
42 security for value. The term does not include a tender offer that is
2024 IN 1388—LS 6710/DI 119 48
1 subject to Section 14(d) of the Securities Exchange Act of 1934
2 (15 U.S.C. 78n(d)).
3 (20) (21) "Person" means an individual; corporation; business
4 trust; estate; trust; partnership; limited liability company;
5 association; joint venture; government; governmental subdivision,
6 agency, or instrumentality; public corporation; or any other legal
7 or commercial entity.
8 (21) (22) "Place of business" of a broker-dealer, an investment
9 adviser, or a federal covered investment adviser means:
10 (A) an office at which the broker-dealer, investment adviser,
11 or federal covered investment adviser regularly provides
12 brokerage or investment advice or solicits, meets with, or
13 otherwise communicates with customers or clients; or
14 (B) any other location that is held out to the general public as
15 a location at which the broker-dealer, investment adviser, or
16 federal covered investment adviser provides brokerage or
17 investment advice or solicits, meets with, or otherwise
18 communicates with customers or clients.
19 (22) (23) "Predecessor act" means IC 23-2-1 (before its repeal).
20 (23) (24) "Price amendment" means the amendment to a
21 registration statement filed under the Securities Act of 1933 or, if
22 an amendment is not filed, the prospectus or prospectus
23 supplement filed under the Securities Act of 1933 that includes a
24 statement of the offering price, underwriting and selling discounts
25 or commissions, amount of proceeds, conversion rates, call prices,
26 and other matters dependent upon the offering price.
27 (24) (25) "Principal place of business" of a broker-dealer or an
28 investment adviser means the executive office of the
29 broker-dealer or investment adviser from which the officers,
30 partners, or managers of the broker-dealer or investment adviser
31 direct, control, and coordinate the activities of the broker-dealer
32 or investment adviser.
33 (25) (26) "Record", except in the phrases "of record", "official
34 record", and "public record", means information that is inscribed
35 on a tangible medium or that is stored in an electronic or other
36 medium and is retrievable in perceivable form.
37 (26) (27) "Sale" includes every contract of sale, contract to sell,
38 or disposition of a security or interest in a security for value, and
39 "offer to sell" includes every attempt or offer to dispose of, or
40 solicitation of an offer to purchase, a security or interest in a
41 security for value. Both terms include:
42 (A) a security given or delivered with, or as a bonus on
2024 IN 1388—LS 6710/DI 119 49
1 account of, a purchase of securities or any other thing
2 constituting part of the subject of the purchase and having
3 been offered and sold for value;
4 (B) a gift of assessable stock involving an offer and sale; and
5 (C) a sale or offer of a warrant or right to purchase or
6 subscribe to another security of the same or another issuer and
7 a sale or offer of a security that gives the holder a present or
8 future right or privilege to convert the security into another
9 security of the same or another issuer, including an offer of the
10 other security.
11 (27) (28) "Securities and Exchange Commission" means the
12 United States Securities and Exchange Commission.
13 (28) (29) "Security" means a note; stock; treasury stock; security
14 future; bond; debenture; evidence of indebtedness; certificate of
15 interest or participation in a profit-sharing agreement; collateral
16 trust certificate; preorganization certificate or subscription;
17 transferable share; investment contract; voting trust certificate;
18 certificate of deposit for a security; fractional undivided interest
19 in oil, gas, or other mineral rights; put, call, straddle, option, or
20 privilege on a security, certificate of deposit, or group or index of
21 securities, including an interest therein or based on the value
22 thereof; put, call, straddle, option, or privilege entered into on a
23 national securities exchange relating to foreign currency; or, in
24 general, an interest or instrument commonly known as a
25 "security"; or a certificate of interest or participation in, temporary
26 or interim certificate for, receipt for, guarantee of, or warrant or
27 right to subscribe to or purchase, any of the foregoing. The term:
28 (A) includes both a certificated and an uncertificated security;
29 (B) does not include an insurance or endowment policy or
30 annuity contract under which an insurance company promises
31 to pay a fixed or variable sum of money either in a lump sum
32 or periodically for life or another specified period;
33 (C) does not include an interest in a contributory or
34 noncontributory pension or welfare plan subject to the
35 Employee Retirement Income Security Act of 1974;
36 (D) includes as an "investment contract" an investment in a
37 common enterprise with the expectation of profits to be
38 derived primarily from the efforts of a person other than the
39 investor and a "common enterprise" means an enterprise in
40 which the fortunes of the investor are interwoven with those of
41 either the person offering the investment, a third party, or other
42 investors; and
2024 IN 1388—LS 6710/DI 119 50
1 (E) includes as an "investment contract", among other
2 contracts, an interest in a limited partnership and a limited
3 liability company and an investment in a viatical settlement or
4 similar agreement.
5 (29) (30) "Self-regulatory organization" means a national
6 securities exchange registered under the Securities Exchange Act
7 of 1934, a national securities association of broker-dealers
8 registered under the Securities Exchange Act of 1934, a clearing
9 agency registered under the Securities Exchange Act of 1934, or
10 the Municipal Securities Rulemaking Board established under the
11 Securities Exchange Act of 1934.
12 (30) (31) "Sign" means, with present intent to authenticate or
13 adopt a record:
14 (A) to execute or adopt a tangible symbol; or
15 (B) to attach or logically associate with the record an
16 electronic symbol, sound, or process.
17 (32) "Staking as a service" has the meaning set forth in
18 IC 34-30-34.5-6.
19 (31) (33) "Third party solicitor" means a person that, for
20 compensation, directly or indirectly, solicits a client for or refers
21 a client to an investment adviser, a federal covered investment
22 adviser, or an investment adviser representative. The term does
23 not include the following:
24 (A) An employee subject to the supervision and control of an
25 investment adviser registered under IC 23-19-4-3.
26 (B) A "supervised person", as defined in Section 202(a)(25) of
27 the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(25)).
28 (C) A partner, officer, director, or employee of a person that
29 controls, is controlled by, or is under common control with an
30 investment adviser or a federal covered investment adviser.
31 (D) An individual excluded by a rule adopted or order issued
32 under this article.
33 (32) (34) "State" means a state of the United States, the District
34 of Columbia, Puerto Rico, the United States Virgin Islands, or any
35 territory or insular possession subject to the jurisdiction of the
36 United States.
37 (33) (35) "Accredited investor" has the meaning set forth in 17
38 CFR 230.501(a).
39 SECTION 8. IC 27-1-12.7-6, AS AMENDED BY P.L.27-2007,
40 SECTION 25, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
41 JULY 1, 2024]: Sec. 6. The issuance of a funding agreement:
42 (1) constitutes an activity necessary, convenient, or expedient to
2024 IN 1388—LS 6710/DI 119 51
1 the business of a life insurance company under IC 27-1-7-2;
2 (2) is not insurance under IC 27-1-5-1;
3 (3) is not a security (as defined in IC 23-19-1-2(28));
4 IC 23-19-1-2(29)); and
5 (4) does not constitute gross premium for taxation purposes under
6 IC 27-1-18-2.
7 SECTION 9. IC 28-8-4.1-201, AS ADDED BY P.L.198-2023,
8 SECTION 4, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
9 JULY 1, 2024]: Sec. 201. The following definitions apply throughout
10 this chapter:
11 (1) "Acting in concert" means persons knowingly acting together
12 with a common goal of jointly acquiring control of a licensee
13 whether or not pursuant to an express agreement.
14 (2) "Authorized delegate" means a person a licensee designates to
15 engage in money transmission on behalf of the licensee.
16 (3) "Average daily money transmission liability", with respect to
17 a calendar quarter, means:
18 (A) the sum of the amounts of a licensee's outstanding money
19 transmission obligations in Indiana at the end of each day in
20 the calendar quarter; divided by
21 (B) the total number of days in that calendar quarter.
22 For purposes of this subdivision, a "calendar quarter" is a quarter
23 ending on March 31, June 30, September 30, or December 31.
24 (4) "Bank Secrecy Act" means:
25 (A) the Bank Secrecy Act (31 U.S.C. 5311 et seq.); and
26 (B) regulations adopted under the Bank Secrecy Act (31
27 U.S.C. 5311 et seq.).
28 (5) "Blockchain protocol" has the meaning set forth in
29 IC 34-30-34.5-2.
30 (5) (6) "Closed loop stored value" means stored value that is
31 redeemable by the issuer only for goods or services provided by
32 the issuer or the issuer's affiliate or by franchisees of the issuer or
33 the issuer's affiliate, except to the extent required by applicable
34 law to be redeemable in cash for its cash value.
35 (6) (7) "Control" means any of the following:
36 (A) The power to vote, directly or indirectly, at least
37 twenty-five percent (25%) of the outstanding voting shares or
38 voting interests of a licensee or of a person in control of a
39 licensee.
40 (B) The power to elect or appoint a majority of key individuals
41 or executive officers, managers, directors, trustees, or other
42 persons exercising managerial authority of a person in control
2024 IN 1388—LS 6710/DI 119 52
1 of a licensee.
2 (C) The power to exercise, directly or indirectly, a controlling
3 influence over the management or policies of a licensee or of
4 a person in control of a licensee. For purposes of this clause,
5 a person is presumed to exercise a controlling influence if the
6 person holds the power to vote, directly or indirectly, at least
7 ten percent (10%) of the outstanding voting shares or voting
8 interests of a licensee or of a person in control of a licensee.
9 However, a person presumed to exercise a controlling
10 influence under this clause may rebut the presumption of
11 control if the person is a passive investor.
12 For purposes of this subdivision, the percentage of a person
13 controlled by any other person is determined by aggregating the
14 other person's interest with the interest of any other immediate
15 family member of that person, including the person's spouse,
16 parents, children, siblings, mothers-in-law and fathers-in-law,
17 sons-in-law and daughters-in-law, and any other person who
18 shares the person's home.
19 (7) (8) "Department" refers to the members of the department of
20 financial institutions.
21 (9) "Digital asset mining" has the meaning set forth in
22 IC 34-30-34.5-3.
23 (10) "Digital asset mining business" has the meaning set forth
24 in IC 8-1-2-4.4.
25 (8) (11) "Director" refers to the director of the department
26 appointed under IC 28-11-2-1.
27 (9) (12) "Eligible rating" means a credit rating of any of the three
28 (3) highest rating categories provided by an eligible rating
29 service, including any rating category modifiers, such as "plus" or
30 "minus" for S&P Global, or an equivalent modifier for any other
31 eligible rating service. The term includes the following:
32 (A) A long term credit rating equal to at least A- by S&P
33 Global, or an equivalent long term credit rating for any other
34 eligible rating service.
35 (B) A short term credit rating equal to at least A-2 by S&P
36 Global, or an equivalent short term credit rating for any other
37 eligible rating service.
38 In any case in which the credit ratings differ among eligible rating
39 services, the highest rating applies in determining whether the
40 credit rating is an "eligible rating" as defined in this subdivision.
41 (10) (13) "Eligible rating service" means:
42 (A) a nationally recognized statistical rating organization, as
2024 IN 1388—LS 6710/DI 119 53
1 defined by the United States Securities and Exchange
2 Commission; or
3 (B) any other organization designated as such by the director.
4 (11) (14) "Federally insured depository financial institution"
5 means:
6 (A) a bank;
7 (B) a credit union;
8 (C) a savings and loan association;
9 (D) a trust company;
10 (E) a corporate fiduciary;
11 (F) a savings association;
12 (G) a savings bank;
13 (H) an industrial bank; or
14 (I) an industrial loan company;
15 that is organized under the law of the United States or any state of
16 the United States and that has federally or privately insured
17 deposits as permitted by state or federal law.
18 (12) (15) "In Indiana", with respect to the location of a
19 transaction, means the following:
20 (A) At a physical location in Indiana, for a transaction
21 requested in person.
22 (B) For a transaction requested electronically or by telephone,
23 a determination made by the provider of money transmission,
24 by relying on the following, that the person requesting the
25 transaction is in Indiana:
26 (i) Information, provided by the person, regarding the
27 location of the individual's residential address or the
28 business entity's principal place of business or other physical
29 address location, as applicable.
30 (ii) Any records associated with the person that the provider
31 of money transmission may have that indicate the person's
32 location, including an address associated with an account.
33 (13) (16) "Individual" means a natural person.
34 (14) (17) "Key individual" means an individual ultimately
35 responsible for establishing or directing policies and procedures
36 of a licensee, such as an executive officer, manager, director, or
37 trustee.
38 (15) (18) "Licensee" means a person licensed under this chapter.
39 (16) (19) "Material litigation" means litigation that, according to
40 United States generally accepted accounting principles, is
41 significant to a person's financial health and would be required to
42 be disclosed in the person's annual audited financial statements,
2024 IN 1388—LS 6710/DI 119 54
1 report to shareholders, or similar records.
2 (17) (20) "Money" means a medium of exchange that is issued by
3 the United States government or by a foreign government. The
4 term includes a monetary unit of account established by an
5 intergovernmental organization or by agreement between two (2)
6 or more governments.
7 (18) (21) "Monetary value" means a medium of exchange,
8 whether or not redeemable in money.
9 (19) (22) "Money transmission" means any of the following:
10 (A) Selling or issuing payment instruments to a person located
11 in Indiana.
12 (B) Selling or issuing stored value to a person located in
13 Indiana.
14 (C) Receiving money for transmission from a person located
15 in Indiana.
16 The term does not include the provision of solely online or
17 telecommunications services or network access. The term does
18 not include digital asset mining, operating a digital asset
19 mining business, transferring digital assets exclusively on a
20 blockchain protocol, staking, staking as a service, or operating
21 a node or series of nodes on a blockchain protocol.
22 (20) (23) "MSB accredited state" means a state agency that is
23 accredited by the Conference of State Bank Supervisors and
24 Money Transmitter Regulators Association for money
25 transmission licensing and supervision.
26 (21) (24) "Multistate licensing process" means an agreement
27 entered into by and among state regulators related to:
28 (A) coordinated processing of applications for money
29 transmission licenses;
30 (B) applications for the acquisition and control of a licensee;
31 (C) control determinations; or
32 (D) notice and information requirements for a change of key
33 individuals.
34 (22) (25) "NMLS" means the Nationwide Multistate Licensing
35 System and Registry:
36 (A) developed by the Conference of State Bank Supervisors
37 and the American Association of Residential Mortgage
38 Regulators; and
39 (B) owned and operated by the State Regulatory Registry,
40 LLC, or by any successor or affiliated entity;
41 for the licensing and registry of persons in financial services
42 industries.
2024 IN 1388—LS 6710/DI 119 55
1 (26) "Node" has the meaning set forth in IC 34-30-34.5-4.
2 (23) (27) "Outstanding money transmission obligation", as
3 established and extinguished in accordance with applicable state
4 law, means:
5 (A) any payment instrument or stored value that:
6 (i) is issued or sold by a licensee to a person located in the
7 United States, or reported as sold by an authorized delegate
8 of the licensee to a person located in the United States; and
9 (ii) has not yet been paid or refunded by or for the licensee,
10 or escheated in accordance with applicable abandoned
11 property laws; or
12 (B) any money that:
13 (i) is received for transmission by a licensee, or by an
14 authorized delegate of the licensee, from a person located in
15 the United States; and
16 (ii) has not been received by the payee or refunded to the
17 seller, or escheated in accordance with applicable
18 abandoned property laws.
19 For purposes of this subdivision, a person is located "in the
20 United States" if the person is located in any state, territory, or
21 possession of the United States or in the District of Columbia, the
22 Commonwealth of Puerto Rico, or a United States military
23 installation located in a foreign country.
24 (24) (28) "Passive investor" means a person that:
25 (A) does not have the power to elect a majority of key
26 individuals or executive officers, managers, directors, trustees,
27 or other persons exercising managerial authority over a person
28 in control of a licensee;
29 (B) is not employed by and does not have any managerial
30 duties with respect to the licensee or a person in control of the
31 licensee;
32 (C) does not have the power to exercise, directly or indirectly,
33 a controlling influence over the management or policies of the
34 licensee or a person in control of the licensee; and
35 (D) either:
36 (i) attests to as facts the characteristics of passivity set forth
37 in clauses (A) through (C), in a form and by a medium
38 prescribed by the director; or
39 (ii) commits to the characteristics of passivity set forth in
40 clauses (A) through (C) in a written document.
41 (25) (29) "Payment instrument" means a written or electronic
42 check, draft, money order, traveler's check, or other written or
2024 IN 1388—LS 6710/DI 119 56
1 electronic instrument for the transmission or payment of money
2 or monetary value, whether or not negotiable. The term does not
3 include:
4 (A) stored value; or
5 (B) any instrument that:
6 (i) is redeemable by the issuer only for goods or services
7 provided by the issuer or its affiliate, or franchisees of the
8 issuer or its affiliate, except to the extent required by
9 applicable law to be redeemable in cash for its cash value;
10 or
11 (ii) is not sold to the public but is issued and distributed as
12 part of a loyalty, rewards, or promotional program.
13 (26) (30) "Person" means any individual, general partnership,
14 limited partnership, limited liability company, corporation, trust,
15 association, joint stock corporation, or other corporate entity, as
16 so identified by the director.
17 (27) (31) "Receiving money for transmission" means receiving
18 money or monetary value in the United States for transmission
19 within or outside the United States by electronic or other means.
20 The term "money received for transmission" has a corresponding
21 meaning.
22 (32) "Staking" has the meaning set forth in IC 34-30-34.5-5.
23 (33) "Staking as a service" has the meaning set forth in
24 IC 34-30-34.5-6.
25 (28) (34) "Stored value" means monetary value representing a
26 claim, against the issuer, that is evidenced by an electronic or
27 digital record and that is intended and accepted for use as a means
28 of redemption for money or monetary value, or payment for goods
29 or services. The term includes "prepaid access" as defined in 31
30 CFR 1010.100. The term does not include:
31 (A) a payment instrument;
32 (B) closed loop stored value; or
33 (C) stored value not sold to the public but issued and
34 distributed as part of a loyalty, rewards, or promotional
35 program.
36 (29) (35) "Tangible net worth" means the aggregate assets of a
37 licensee, excluding all intangible assets, less liabilities, as
38 determined in accordance with United States generally accepted
39 accounting principles.
40 SECTION 10. IC 34-30-34.5 IS ADDED TO THE INDIANA
41 CODE AS A NEW CHAPTER TO READ AS FOLLOWS
42 [EFFECTIVE JULY 1, 2024]:
2024 IN 1388—LS 6710/DI 119 57
1 Chapter 34.5. Immunity for Digital Asset Mining
2 Sec. 1. As used in this chapter, "blockchain" means data that is:
3 (1) shared across a network to create a ledger of verified
4 transactions or information among network participants
5 linked using cryptography to maintain the integrity of the
6 ledger and to execute other functions; and
7 (2) distributed among network participants in an automated
8 fashion to concurrently update network participants on the
9 state of the ledger and any other functions.
10 Sec. 2. As used in this chapter, "blockchain protocol" means any
11 executable software deployed to a blockchain composed of source
12 code that is publicly available and accessible, including a smart
13 contract or network of smart contracts.
14 Sec. 3. As used in this chapter, "digital asset mining" means the
15 use of one (1) or more nodes for the purpose of securing a
16 blockchain protocol.
17 Sec. 4. As used in this chapter, "node" means a computational
18 device that does one (1) or more of the following:
19 (1) Communicates with other devices or participants on a
20 blockchain to maintain consensus and integrity of the
21 blockchain.
22 (2) Contains and validates transaction blocks.
23 (3) Contains and updates a copy of the blockchain.
24 Sec. 5. "Staking" means the act of committing digital assets for
25 a period of time to validate and secure a specific blockchain
26 protocol using a node to lock digital assets in order to operate the
27 consensus mechanism of a blockchain protocol.
28 Sec. 6. "Staking as a service" means the provision of technical
29 staking services, including the operation of nodes and associated
30 infrastructure, necessary to facilitate participation in the consensus
31 mechanisms of blockchain protocols.
32 Sec. 7. Notwithstanding any other provision of law, a person
33 that engages in any of the following with respect to a transaction
34 on a blockchain network is not subject to civil liability solely for
35 the person's validation of the transaction:
36 (1) Digital asset mining.
37 (2) Operating a node or series of nodes on a blockchain
38 network.
39 (3) Staking or providing staking as a service.
40 SECTION 11. IC 35-46-7-2, AS AMENDED BY P.L.27-2007,
41 SECTION 32, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
42 JULY 1, 2024]: Sec. 2. This chapter does not apply to the following:
2024 IN 1388—LS 6710/DI 119 58
1 (1) A gift or donation of money or other asset given to:
2 (A) a health care provider in the corporate name of the health
3 care provider; or
4 (B) a health care provider that is organized under Section
5 501(c)(3) of the Internal Revenue Code.
6 (2) A gift or loan of money or other asset given by a person who
7 receives services from a health care provider to a member of the
8 person's family who:
9 (A) is employed by a health care provider; or
10 (B) owns, wholly or jointly, a health care provider.
11 (3) A bequest of personal property or devise of real property made
12 in an executable will as described in IC 29-1-5-5 to a health care
13 provider or an owner, employee, or agent of a health care
14 provider.
15 (4) The purchase of a security (as defined in IC 23-19-1-2(28))
16 IC 23-19-1-2(29)) that is traded on a national or regional
17 exchange.
18 (5) A gift or gratuity, not exceeding five hundred dollars ($500)
19 in the aggregate per year per person receiving services from the
20 health care provider, to an employee of a health care provider.
21 (6) A gift or donation of money or other asset given to purchase
22 or otherwise acquire a product, service, or amenity for the use,
23 entertainment, or enjoyment of persons receiving services from a
24 health care provider.
25 SECTION 12. IC 36-1-3-14 IS ADDED TO THE INDIANA CODE
26 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
27 1, 2024]: Sec. 14. (a) The following definitions apply throughout
28 this section:
29 (1) "Digital asset" has the meaning set forth in IC 6-3-1-4.2.
30 (2) "Hardware wallet" means a physical device that is not
31 continuously connected to the Internet and allows an
32 individual to secure and transfer digital assets and under
33 which the owner of the digital assets retains independent
34 control over the digital assets.
35 (3) "Self hosted wallet" means a digital interface used to
36 secure and transfer digital assets and under which the owner
37 of the digital assets retains independent control over the
38 digital assets that is secured by the digital interface.
39 (b) A unit may not adopt or enforce an ordinance that would
40 have the effect of prohibiting, restricting, or impairing an
41 individual's ability to:
42 (1) use digital assets to purchase legal goods and services; or
2024 IN 1388—LS 6710/DI 119 59
1 (2) use a hardware wallet or self-hosted wallet to store the
2 individual's digital assets.
3 SECTION 13. IC 36-1-30.5 IS ADDED TO THE INDIANA CODE
4 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
5 JULY 1, 2024]:
6 Chapter 30.5. Regulation of Digital Asset Mining
7 Sec. 1. As used in this chapter, "blockchain" has the meaning set
8 forth in IC 34-30-34.5-1.
9 Sec. 2. As used in this chapter, "digital asset mining business"
10 has the meaning set forth in IC 8-1-2-4.4.
11 Sec. 3. As used in this chapter, "node" has the meaning set forth
12 in IC 34-30-34.5-4.
13 Sec. 4. Use of a property for a digital asset mining business is a
14 permitted industrial use under any applicable zoning ordinance of
15 a unit and may not be disallowed by a zoning ordinance (as defined
16 in IC 36-7-1-22) in a zoning district or classification of a unit that
17 permits industrial use.
18 Sec. 5. A unit may enact or enforce a law or plan that regulates,
19 prohibits, or limits use of property for digital asset mining in an
20 industrial zoning district or classification of a unit only:
21 (1) for the purpose of zoning regulations related to noise; and
22 (2) if enforcement is performed in the same manner as
23 enforcement that applies to similar properties that are not
24 used for digital asset mining businesses.
25 Sec. 6. A unit may not:
26 (1) require a special exception, special use, or zoning variance
27 for the use of a property for a digital asset mining business in
28 an industrial zoning district or classification of a unit;
29 (2) interpret and enforce the unit's zoning regulations in a
30 manner that is intended for or has the effect of prohibiting or
31 unreasonably restricting the use of industrial property for a
32 digital asset mining business; or
33 (3) require a permit for the use of a property for a digital
34 asset mining business in an area that is zoned for industrial
35 use.
36 Sec. 7. A unit may change the zoning classification of a property
37 used for a digital asset mining business only as provided under
38 IC 36-7-4.
39 SECTION 14. An emergency is declared for this act.
2024 IN 1388—LS 6710/DI 119