Computation of franchise tax
Sec. 1. (a) There is imposed on each taxpayer a franchise tax
measured by the taxpayer's apportioned income for the privilege of
exercising its franchise or the corporate privilege of transacting the
business of a financial institution in Indiana. The amount of the tax
for a taxable year shall be determined by multiplying eight and
one-half percent (8.5%) times the remainder of:
(1) the taxpayer's apportioned income; minus
(2) the taxpayer's deductible Indiana net operating losses as
determined under this section; minus
(3) the taxpayer's net capital losses minus the taxpayer's net
capital gains computed under the Internal Revenue Code for
each taxable year or part of a taxable year beginning after
December 31, 1989, multiplied by the apportionment
percentage applicable to the taxpayer under IC 6-5.5-2 for the
taxable year of the loss.
A net capital loss for a taxable year is a net capital loss carryover to
each of the five (5) taxable years that follow the taxable year in
which the loss occurred.
(b) The amount of net operating losses deductible under
subsection (a) is an amount equal to the net operating losses
computed under the Internal Revenue Code, adjusted for the items
set forth in IC 6-5.5-1-2, that are:
(1) incurred in each taxable year, or part of a year, beginning
after December 31, 1989; and
(2) attributable to Indiana.
(c) The following apply to determining the amount of net
operating losses that may be deducted under subsection (a):
(1) The amount of net operating losses that is attributable to
Indiana is the taxpayer's total net operating losses under the
Internal Revenue Code for the taxable year of the loss, adjusted
for the items set forth in IC 6-5.5-1-2, multiplied by the
apportionment percentage applicable to the taxpayer under
IC 6-5.5-2 for the taxable year of the loss.
(2) A net operating loss for any taxable year is a net operating
loss carryover to each of the fifteen (15) taxable years that
follow the taxable year in which the loss occurred.
(d) The following provisions apply to a combined return
computing the tax on the basis of the income of the unitary group
when the return is filed for more than one (1) taxpayer member of the
unitary group for any taxable year:
(1) Any net capital loss or net operating loss attributable to
Indiana in the combined return shall be prorated between each
taxpayer member of the unitary group by the quotient of:
(A) the receipts of that taxpayer member attributable to
Indiana under section 4 of this chapter; divided by
(B) the receipts of all taxpayer members of the unitary group
attributable to Indiana.
(2) The net capital loss or net operating loss for that year, if
any, to be carried forward to any subsequent year shall be
limited to the capital gains or apportioned income for the
subsequent year of that taxpayer, determined by the same
receipts formula set out in subdivision (1).
As added by P.L.347-1989(ss), SEC.1. Amended by P.L.21-1990,
SEC.21; P.L.68-1991, SEC.4; P.L.1-1992, SEC.19; P.L.6-2000,
SEC.1.
Last modified: May 28, 2006