Introduced Version
SENATE BILL No. 154
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-3.
Synopsis: Various tax matters. Increases the maximum amount of the
income tax credit for an individual employed as a teacher for amounts
expended for classroom supplies from $100 to $500 per taxable year.
Adds students who attend public schools for purposes of eligibility for
the unreimbursed education expenditure tax deduction. Provides that
the amount of the deduction is the lesser of: (1) $1,000 multiplied by
the number of the taxpayer's dependent children for whom the taxpayer
made education expenditures in the taxable year; or (2) the total
amount of actual unreimbursed education expenditures that the
taxpayer incurs for each of the taxpayer's dependent children in the
taxable year. (Under current law, the amount is $1,000 multiplied by
the number of the taxpayer's dependent children for whom the taxpayer
made education expenditures in the taxable year.) Defines "public
school".
Effective: January 1, 2025 (retroactive).
Randolph Lonnie M
January 8, 2025, read first time and referred to Committee on Tax and Fiscal Policy.
2025 IN 154—LS 6603/DI 120 Introduced
First Regular Session of the 124th General Assembly (2025)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
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between statutes enacted by the 2024 Regular Session of the General Assembly.
SENATE BILL No. 154
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 6-3-2-22, AS AMENDED BY P.L.92-2020,
2 SECTION 4, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
3 JANUARY 1, 2025 (RETROACTIVE)]: Sec. 22. (a) The following
4 definitions apply throughout this section:
5 (1) "Dependent child" means an individual who:
6 (A) is eligible to receive a free elementary or high school
7 education in an Indiana school corporation;
8 (B) qualifies as a dependent (as defined in Section 152 of the
9 Internal Revenue Code) of the taxpayer; and
10 (C) is the natural or adopted child of the taxpayer or, if custody
11 of the child has been awarded in a court proceeding to
12 someone other than the mother or father, the court appointed
13 guardian or custodian of the child.
14 If the parents of a child are divorced, the term refers to the parent
15 who is eligible to take the exemption for the child under Section
16 151 of the Internal Revenue Code.
17 (2) "Education expenditure" refers to any expenditures made in
2025 IN 154—LS 6603/DI 120 2
1 connection with enrollment, attendance, or participation of the
2 taxpayer's dependent child in a public school or private
3 elementary or high school education program. The term includes
4 tuition, fees, computer software, textbooks, workbooks, curricula,
5 school supplies, (other than personal computers), and other
6 written materials used primarily for academic instruction or for
7 academic tutoring, or both.
8 (3) "Private elementary or high school education program" means
9 attendance at:
10 (A) a nonpublic school (as defined in IC 20-18-2-12); or
11 (B) a state accredited nonpublic school (as defined in
12 IC 20-18-2-18.7);
13 in Indiana that satisfies a child's obligation under IC 20-33-2 for
14 compulsory attendance at a school. The term does not include the
15 delivery of instructional service in a home setting to a dependent
16 child who is enrolled in a school corporation or a charter school.
17 (4) "Public school" means attendance at:
18 (A) a public school (as defined in IC 20-18-2-15); or
19 (B) a charter school (as defined in IC 20-24-1-4);
20 in Indiana that satisfies a child's obligation under IC 20-33-2
21 for compulsory attendance at a school.
22 (b) This section applies to taxable years beginning after December
23 31, 2010.
24 (c) A taxpayer who makes an unreimbursed education expenditure
25 during the taxpayer's taxable year is entitled to a deduction against the
26 taxpayer's adjusted gross income in the taxable year.
27 (d) The amount of the deduction is equal to the lesser of the
28 following:
29 (1) The product of:
30 (A) one thousand dollars ($1,000); multiplied by
31 (2) (B) the number of the taxpayer's dependent children for
32 whom the taxpayer made education expenditures in the taxable
33 year.
34 (2) The total amount of actual unreimbursed education
35 expenditures that the taxpayer incurs for each of the
36 taxpayer's dependent children in the taxable year.
37 A husband and wife are entitled to only one (1) deduction under this
38 section.
39 (e) To receive the deduction provided by this section, a taxpayer
40 must claim the deduction on the taxpayer's annual state tax return or
41 returns in the manner prescribed by the department.
42 SECTION 2. IC 6-3-3-14.5, AS ADDED BY P.L.213-2015,
2025 IN 154—LS 6603/DI 120 3
1 SECTION 82, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
2 JANUARY 1, 2025 (RETROACTIVE)]: Sec. 14.5. (a) As used in this
3 section, "classroom supplies" means any items that qualify for the
4 educator expense deduction under Section 62(a)(2)(D) of the Internal
5 Revenue Code. (as effective December 31, 2013).
6 (b) Each taxable year, an individual employed as a teacher (as
7 defined in IC 20-18-2-22(a)) is entitled to a credit against the
8 individual's adjusted gross income tax liability for amounts expended
9 during the taxable year for classroom supplies. The amount of the
10 credit is the lesser of:
11 (1) one five hundred dollars ($100); ($500); or
12 (2) the total amount expended for classroom supplies during a
13 taxable year.
14 (c) The credit provided by this section may not exceed the amount
15 of the individual's adjusted gross income tax liability for the taxable
16 year, reduced by the sum of all credits for the taxable year that are
17 applied before the application of the credit provided by this section.
18 The amount of any unused credit under this section for a taxable year
19 may not be carried forward to a succeeding taxable year, carried back
20 to a preceding taxable year, or refunded.
21 SECTION 3. [EFFECTIVE JANUARY 1, 2025 (RETROACTIVE)]
22 (a) IC 6-3-2-22 and IC 6-3-3-14.5, both as amended by this act,
23 apply to taxable years beginning after December 31, 2024.
24 (b) This SECTION expires June 30, 2028.
25 SECTION 4. An emergency is declared for this act.
2025 IN 154—LS 6603/DI 120