Amount of credit
Sec. 12. (a) To be entitled to a credit for a purchase described in
section 4(1) of this chapter, a taxpayer must request the Indiana
economic development corporation to determine:
(1) whether a purchase of an ownership interest in a business
located in a qualified area is a qualified investment; and
(2) the percentage credit to be allowed.
The request must be made before a purchase is made.
(b) To be entitled to a credit for an investment described in
section 4(2) of this chapter, a taxpayer must request the Indiana
economic development corporation to determine:
(1) whether an investment in a business that locates in a
qualified area during the taxable year is a qualified investment;
and
(2) the percentage credit to be allowed.
The request must be made before an investment is made.
(c) The Indiana economic development corporation shall find that
a purchase or other investment is a qualified investment if:
(1) the business is viable;
(2) the taxpayer has a legitimate purpose for purchase of the
ownership interest or the investment;
(3) the purchase or investment would not be made unless a
credit is allowed under this chapter; and
(4) the purchase or investment is critical to the commencement,
enhancement, or expansion of business operations in the
qualified area and:
(A) in the case of a purchase described in section 4(1) of this
chapter, the purchase will not merely transfer ownership,
and the purchase proceeds will be used only in business
operations in the qualified area; and
(B) in the case of an investment described in section 4(2) of
this chapter, the investment will not be made in a business
that substantially reduces or ceases its operations at another
location in Indiana in order to relocate its operations within
the qualified area, as described in section 13 of this chapter.
(d) If the Indiana economic development corporation finds that a
purchase or other investment is a qualified investment, the
corporation shall certify the percentage credit to be allowed under
this chapter based upon the following:
(1) For a purchase described in section 4(1) of this chapter, a
percentage credit of ten percent (10%) may be allowed based on
the need of the business for equity financing, as demonstrated
by the inability of the business to obtain debt financing.
(2) A percentage credit of two percent (2%) may be allowed for
purchases of or investments in business operations in the retail,
professional, or warehouse/distribution codes of the SIC
Manual (or corresponding sectors in the NAICS Manual).
(3) A percentage credit of five percent (5%) may be allowed for
purchases of or investments in business operations in the
manufacturing codes of the SIC Manual (or corresponding
sectors in the NAICS Manual).
(4) A percentage credit of five percent (5%) may be allowed for
purchases of or investments in high technology business
operations (as defined in IC 5-28-15-1).
(5) A percentage credit may be allowed for jobs created during
the twelve (12) month period following the purchase of an
ownership interest in the business or other investment in the
business, as determined under the following table:
JOBS CREATED PERCENTAGE
Less than 11 jobs . . . . . . . . . . . . . . . . . . . . . . . . . . . 1%
11 to 25 jobs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2%
26 to 40 jobs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3%
41 to 75 jobs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4%
More than 75 jobs . . . . . . . . . . . . . . . . . . . . . . . . . . . 5%
(6) A percentage credit of five percent (5%) may be allowed if
fifty percent (50%) or more of the jobs created in the twelve
(12) month period following the purchase of an ownership
interest in the business or other investment in the business will
be reserved for residents in the qualified area.
(7) A percentage credit may be allowed for investments made
in real or depreciable personal property, as determined under
the following table:
AMOUNT OF INVESTMENT PERCENTAGE
Less than $25,001 . . . . . . . . . . . . . . . . . . . . . . . . . . . 1%
$25,001 to $50,000 . . . . . . . . . . . . . . . . . . . . . . . . . . 2%
$50,001 to $100,000 . . . . . . . . . . . . . . . . . . . . . . . . . 3%
$100,001 to $200,000 . . . . . . . . . . . . . . . . . . . . . . . . 4%
More than $200,000 . . . . . . . . . . . . . . . . . . . . . . . . . 5%
The total percentage credit may not exceed thirty percent (30%).
(e) In the case of a purchase described in section 4(1) of this
chapter, if all or a part of a purchaser's intent is to transfer
ownership, the tax credit shall be applied only to that part of the
purchase that relates directly to the enhancement or expansion of
business operations in the qualified area.
As added by P.L.81-2004, SEC.22. Amended by P.L.4-2005, SEC.64.
Last modified: May 28, 2006