February 1, 2005
HOUSE BILL No. 1120
DIGEST OF HB 1120
(Updated January 31, 2005 4:04 pm - DI 92)
Citations Affected: IC 6-3.1; noncode.
Synopsis: Hoosier business investment tax credit. Extends the
availability of the Hoosier business investment tax credit for
investments made after December 31, 2007. Requires the economic
development for a growing economy board to consider and evaluate all
applications for credit awards using the criteria required by statute.
Prohibits the board from establishing eligibility standards that are not
specified by statute. Removes the board's authority to require
performance conditions that are not specified by statute in an
agreement between a taxpayer and the board. Clarifies the method for
applying the tax credit to the members of a pass through entity.
Effective: January 1, 2004 (retroactive); July 1, 2005.
, Adams T
January 6, 2005, read first time and referred to Committee on Ways and Means.
January 27, 2005, reported _ Do Pass.
January 31, 2005, read second time, amended, ordered engrossed.
February 1, 2005
First Regular Session 114th General Assembly (2005)
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
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
this style type
between statutes enacted by the 2004 Regular Session of the General Assembly.
HOUSE BILL No. 1120
A BILL FOR AN ACT to amend the Indiana Code concerning
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 6-3.1-26-12; (05)HB1120.2.1. -->
SECTION 1. IC 6-3.1-26-12 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 12. (a) The board may
make credit awards under this chapter to foster job creation and higher
wages in Indiana.
(b) The board shall consider and evaluate all applications for
credit awards using the criteria required by this chapter. The
board may not establish eligibility standards that are not specified
by this chapter.
SOURCE: IC 6-3.1-26-16; (05)HB1120.2.2. -->
SECTION 2. IC 6-3.1-26-16 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JANUARY 1, 2004 (RETROACTIVE)]:
Sec. 16. (a)
If a pass through entity does not have state tax liability
growth against which the tax credit may be applied, the pass through
entity may compute the state tax liability growth that the pass
through entity would have had if the pass through entity had been
a taxpayer after applying all allowable deductions and credits in
each taxable year over which state tax liability growth is computed.
(b) If the pass through entity would have had state tax liability
growth if the pass through entity were a taxpayer, a shareholder,
member, or partner of the pass through entity is entitled to a tax credit
(1) the tax credit determined for the pass through entity for the
taxable year under this section; multiplied by
(2) the percentage of the pass through entity's distributive income
to which the shareholder, member, or partner is entitled.
SOURCE: IC 6-3.1-26-21; (05)HB1120.2.3. -->
SECTION 3. IC 6-3.1-26-21 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 21. The board shall
enter into an agreement with an applicant that is awarded a credit under
this chapter. The agreement must include all the following:
(1) A detailed description of the project that is the subject of the
(2) The first taxable year for which the credit may be claimed.
(3) The amount of the taxpayer's state tax liability for each tax in
the taxable year of the taxpayer that immediately preceded the
first taxable year in which the credit may be claimed.
(4) The maximum tax credit amount that will be allowed for each
(5) A requirement that the taxpayer shall maintain operations at
the project location for at least ten (10) years during the term that
the tax credit is available.
(6) A specific method for determining the number of new
employees employed during a taxable year who are performing
jobs not previously performed by an employee.
(7) A requirement that the taxpayer shall annually report to the
board the number of new employees who are performing jobs not
previously performed by an employee, the average wage of the
new employees, the average wage of all employees at the location
where the qualified investment is made, and any other
information the director needs to perform the director's duties
under this chapter.
(8) A requirement that the director is authorized to verify with the
appropriate state agencies the amounts reported under subdivision
(7), and that after doing so shall issue a certificate to the taxpayer
stating that the amounts have been verified.
(9) A requirement that the taxpayer shall pay an average wage to
all its employees other than highly compensated employees in
each taxable year that a tax credit is available that equals at least
one hundred fifty percent (150%) of the hourly minimum wage
under IC 22-2-2-4 or its equivalent.
(10) A requirement that the taxpayer will keep the qualified
investment property that is the basis for the tax credit in Indiana
for at least the lesser of its useful life for federal income tax
purposes or ten (10) years.
(11) A requirement that the taxpayer will maintain at the location
where the qualified investment is made during the term of the tax
credit a total payroll that is at least equal to the payroll level that
existed before the qualified investment was made.
(12) A requirement that the taxpayer shall provide written
notification to the director and the board not more than thirty (30)
days after the taxpayer makes or receives a proposal that would
transfer the taxpayer's state tax liability obligations to a successor
(13) Any other performance conditions that the board determines
SOURCE: IC 6-3.1-26-26; (05)HB1120.2.4. -->
SECTION 4. IC 6-3.1-26-26 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 26.
(a) This chapter
applies to taxable years beginning after December 31, 2003.
(b) Notwithstanding the other provisions of this chapter, a taxpayer
is not entitled to a credit for a qualified investment made after
December 31, 2007. However, this section may not be construed to
prevent a taxpayer from carrying an unused tax credit attributable to a
qualified investment made before January 1, 2008, forward to a taxable
year beginning after December 31, 2007, in the manner provided by
section 15 of this chapter.
SOURCE: ; (05)HB1120.2.5. -->
SECTION 5. [EFFECTIVE JANUARY 1, 2004 (RETROACTIVE)]
IC 6-3.1-26-16, as amended by this act, applies to taxable years
beginning after December 31, 2003.
SOURCE: ; (05)HB1120.2.6. -->
SECTION 6. An emergency is declared for this act.