Citations Affected:
IC 6-3.1
.
Synopsis: Tax credits for biodiesel and gasohol. Provides income tax
credits for the production and the retail sale of gasohol and biodiesel.
Effective: January 1, 2004.
January 21, 2003, read first time and referred to Committee on Agriculture and Small
Business.
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
SECTION 1.
IC 6-3.1-25
IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2004]:
Chapter 25. Gasohol and Biodiesel Production Tax Credit
Sec. 1. As used in this chapter, "biodiesel" means a renewable,
biodegradable, mono alkyl ester combustible liquid fuel derived
from agricultural plant oils or animal fats that meets American
Society for Testing and Materials specification D6751-02 for
biodiesel fuel (B100) blend stock distillate fuels.
Sec. 2. As used in this chapter, "ethanol" means agriculturally
derived ethyl alcohol.
Sec. 3. As used in this chapter, "gasohol" means gasoline that
contains:
(1) at least ten percent (10%) ethanol; or
(2) ethyl tertiary butyl ether (ETBE) additives derived from
ethanol.
Sec. 4. As used in this chapter, "pass through entity" means:
(1) a corporation that is exempt from the adjusted gross
income tax under
IC 6-3-2-2.8
(2);
(2) a partnership;
(3) a limited liability company; or
(4) a limited liability partnership.
Sec. 5. As used in this chapter, "state tax liability" means a
taxpayer's total tax liability that is incurred under:
(1) IC 6-2.5 (the state gross retail and use tax);
(2)
IC 6-3-1
through
IC 6-3-7
(the adjusted gross income tax);
(3) IC 6-5.5 (the financial institutions tax); and
(4)
IC 27-1-18-2
(the insurance premiums tax);
as computed after the application of the credits that under
IC 6-3.1-1-2
are to be applied before the credit provided by this
chapter.
Sec. 6. As used in this chapter, "taxpayer" means an individual
or entity that has any state tax liability.
Sec. 7. A taxpayer who produces gasohol or biodiesel at a
facility located in Indiana is entitled to a credit against the
taxpayer's state tax liability equal to the product of:
(1) eighteen cents ($0.18); multiplied by
(2) the number of gallons of gasohol or biodiesel produced at
the Indiana facility.
Sec. 8. If a pass through entity is entitled to a credit under
section 7 of this chapter but does not have state tax liability against
which the tax credit may be applied, a shareholder, partner, or
member of the pass through entity is entitled to a tax credit equal
to:
(1) the tax credit determined for the pass through entity for
the taxable year; multiplied by
(2) the percentage of the pass through entity's distributive
income to which the shareholder, partner, or member is
entitled.
Sec. 9. (a) If the amount of the credit determined under section
7 of this chapter for a taxpayer in a taxable year exceeds the
taxpayer's state tax liability for that taxable year, the taxpayer
may carry over the excess to the following taxable years. The
amount of the credit carryover from a taxable year shall be
reduced to the extent that the carryover is used by the taxpayer to
obtain a credit under this chapter for any subsequent taxable year.
(b) A taxpayer is not entitled to a carryback or refund of any
unused credit.
Sec. 10. To receive the credit provided by this chapter, a
taxpayer must claim the credit on the taxpayer's state tax return
or returns in the manner prescribed by the department. The
taxpayer shall submit to the department proof of the number of
gallons of gasohol or biodiesel that the taxpayer produced in
Indiana and all information that the department determines is
necessary for the calculation of the credit provided by this chapter.
SECTION 2.
IC 6-3.1-26
IS ADDED TO THE INDIANA CODE
AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2004]:
Chapter 26. Gasohol and Biodiesel Retailer Tax Credit
Sec. 1. As used in this chapter, "biodiesel" means a renewable,
biodegradable, mono alkyl ester combustible liquid fuel derived
from agricultural plant oils or animal fats that meets American
Society for Testing and Materials specification D6751-02 for
biodiesel fuel (B100) blend stock distillate fuels.
Sec. 2. As used in this chapter, "dealer" has the meaning set
forth in
IC 6-6-1.1-103.
Sec. 3. As used in this chapter, "ethanol" means agriculturally
derived ethyl alcohol.
Sec. 4. As used in this chapter, "gasohol" means gasoline that
contains:
(1) at least ten percent (10%) ethanol; or
(2) ethyl tertiary butyl ether (ETBE) additives derived from
ethanol.
Sec. 5. As used in this chapter, "gasoline" has the meaning set
forth in
IC 6-6-1.1-103.
Sec. 6. As used in this chapter, "motor fuel" has the meaning set
forth in
IC 6-6-4.1-1.
Sec. 7. As used in this chapter, "pass through entity" means:
(1) a corporation that is exempt from the adjusted gross
income tax under
IC 6-3-2-2.8
(2);
(2) a partnership;
(3) a limited liability company; or
(4) a limited liability partnership.
Sec. 8. As used in this chapter, "qualified fuel" means either:
(1) biodiesel; or
(2) gasohol.
Sec. 9. As used in this chapter, "service station" means a retail
outlet where a dealer sells a motor fuel through a metered pump.
Sec. 10. As used in this chapter, "state tax liability" means a
taxpayer's total tax liability that is incurred under:
(1) IC 6-2.5 (the state gross retail and use tax);
(2)
IC 6-3-1
through
IC 6-3-7
(the adjusted gross income tax);
(3) IC 6-5.5 (the financial institutions tax); and
(4)
IC 27-1-18-2
(the insurance premiums tax);
as computed after the application of the credits that under
IC 6-3.1-1-2
are to be applied before the credit provided by this
chapter.
Sec. 11. As used in this chapter, "taxpayer" means an individual
or entity that has any state tax liability.
Sec. 12. (a) A taxpayer who:
(1) is a dealer; and
(2) operates a service station in Indiana at which more than
sixty percent (60%) of the total gallons of motor fuel sold and
dispensed through a metered pump in a taxable year is a
qualified fuel;
is entitled to a credit against the taxpayer's state tax liability.
(b) The amount of the credit allowed under this section is the
product of:
(1) two and five-tenths cents ($0.025); multiplied by
(2) the total number of gallons of qualified fuel sold and
dispensed through all of the metered pumps located at a
service station described in subsection (a)(2).
(c) The credit allowed under this subsection must be computed
separately for each service station operated by the taxpayer that
meets the requirements of subsection (a)(2).
Sec. 13. If a pass through entity is entitled to a credit under
section 12 of this chapter but does not have state tax liability
against which the tax credit may be applied, a shareholder,
partner, or member of the pass through entity is entitled to a tax
credit equal to:
(1) the tax credit determined for the pass through entity for
the taxable year; multiplied by
(2) the percentage of the pass through entity's distributive
income to which the shareholder, partner, or member is
entitled.
Sec. 14. (a) If the amount of the credit determined under section
12 of this chapter for a taxpayer in a taxable year exceeds the
taxpayer's state tax liability for that taxable year, the taxpayer
may carry over the excess to the following taxable years. The
amount of the credit carryover from a taxable year shall be
reduced to the extent that the carryover is used by the taxpayer to
obtain a credit under this chapter for any subsequent taxable year.
(b) A taxpayer is not entitled to a carryback or refund of any
unused credit.
Sec. 15. To receive the credit provided by this chapter, a
taxpayer must claim the credit on the taxpayer's state tax return
or returns in the manner prescribed by the department. The
taxpayer shall submit to the department proof of the number of
gallons of qualified fuel that the taxpayer sold at each service
station for which the taxpayer claims a credit under this chapter
and all information that the department determines is necessary
for the calculation of the credit provided by this chapter.
SECTION 3. [EFFECTIVE JANUARY 1, 2004]
IC 6-3.1-25
and
IC 6-3.1-26
, both as added by this act, apply to taxable years
beginning after December 31, 2003.