January 23, 2007, read first time and referred to Committee on Ways and Means.
First Regular Session 115th General Assembly (2007)
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 2006 Regular Session of the General Assembly.
HOUSE BILL No. 1591
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 6-3.1-1-3; (07)IN1591.1.1. -->
SECTION 1. IC 6-3.1-1-3, AS ADDED BY P.L.199-2005,
SECTION 17, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2008]: Sec. 3. A taxpayer (as defined in the following
laws), pass through entity (as defined in the following laws), or
shareholder, partner, or member of a pass through entity may not be
granted more than one (1) tax credit under the following laws for the
(1) IC 6-3.1-10 (enterprise zone investment cost credit).
(2) IC 6-3.1-11 (industrial recovery tax credit).
(3) IC 6-3.1-11.5 (military base recovery tax credit).
(4) IC 6-3.1-11.6 (military base investment cost credit).
(5) IC 6-3.1-13.5 (capital investment tax credit).
(6) IC 6-3.1-19 (community revitalization enhancement district
(7) IC 6-3.1-24 (venture capital investment tax credit).
(8) IC 6-3.1-26 (Hoosier business investment tax credit).
(9) IC 6-3.1-27 (biodiesel or blended diesel tax credits).
(10) IC 6-3.1-28 (ethanol production tax credit).
(11) IC 6-3.1-31 (renewable energy investment tax credit).
If a taxpayer, pass through entity, or shareholder, partner, or member
of a pass through entity has been granted more than one (1) tax credit
for the same project, the taxpayer, pass through entity, or shareholder,
partner, or member of a pass through entity must elect to apply only
one (1) of the tax credits in the manner and form prescribed by the
SOURCE: IC 6-3.1-31; (07)IN1591.1.2. -->
SECTION 2. IC 6-3.1-31 IS ADDED TO THE INDIANA CODE
AS A NEW
CHAPTER TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2008]:
Chapter 31. Renewable Energy Investment Tax Credit
Sec. 1. As used in this chapter, "commission" refers to the
Indiana utility regulatory commission.
Sec. 2. As used in this chapter, "corporation" refers to the
Indiana economic development corporation.
Sec. 3. As used in this chapter, "credit" refers to a credit against
state tax liability that is awarded by the corporation to a person
under this chapter.
Sec. 4. As used in this chapter, "department" refers to the
department of state revenue.
Sec. 5. As used in this chapter, "office" refers to the office of
energy and defense development within the office of the lieutenant
Sec. 6. 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;
(4) a limited liability partnership;
(5) a corporation organized under IC 8-1-13; or
(6) a corporation organized under IC 23-17-1 that is an
electric cooperative and that has at least one (1) member that
is a corporation organized under IC 8-1-13.
Sec. 7. As used in this chapter, "person" refers to an individual,
a corporation, a pass through entity, or any other entity that may
sue and be sued.
Sec. 8. As used in this chapter, "project" means a facility,
software, or equipment that is placed in service in Indiana and
directly used to produce:
(1) electricity; or
(2) a liquid fuel that is suitable for use in an internal
from a renewable energy resource.
Sec. 9. As used in this chapter, "qualified investment" means the
amount of a person's expenditures for a project that is located in
Sec. 10. As used in this chapter, "renewable energy resource"
means any of the following:
(2) Solar energy.
(3) Open-loop biomass (as defined in Section 45 of the Internal
(4) Corn, soybeans, or other organic material from a plant.
(5) Municipal solid waste (as defined in Section 45 of the
Internal Revenue Code).
(6) Geothermal energy.
(7) Small irrigation power (as defined in Section 45 of the
Internal Revenue Code).
(8) Qualified hydropower production (as defined in Section 45
of the Internal Revenue Code).
(9) Industrial waste gas.
(11) Another alternative renewable energy source approved
by the corporation after consultation with the office.
Sec. 11. As used in this chapter, "state tax liability" means a
taxpayer's total tax liability that is incurred under:
(1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);
(2) IC 6-2.3 (the utility receipts tax);
(3) IC 27-1-18-2 (the insurance premiums tax); and
(4) IC 6-5.5 (the financial institutions 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
Sec. 12. As used in this chapter, "taxpayer" means:
(1) a person that:
(A) is the holder of a credit that is awarded or assigned
under this chapter; and
(B) has a state tax liability against which any part of the
credit may be applied; or
(2) a shareholder, partner, or member of a pass through
(A) is the holder of a credit that is awarded or assigned
under this chapter; and
(B) does not have any state tax liability against which any
part of the credit may be applied.
Sec. 13. (a) The corporation may award a credit to a person that
makes a qualified investment in Indiana.
(b) The corporation, in consultation with the office, may adopt
rules under IC 4-22-2 and guidelines to implement this chapter.
Sec. 14. The total amount of a credit that may be awarded under
this chapter to a person for a taxable year is a percentage
determined by the corporation, not to exceed ten percent (10%) of
the amount of a qualified investment made by the person for a
project that is placed in service in the taxable year.
Sec. 15. A person that desires to apply for the credit provided in
this chapter shall apply to the corporation in the manner
prescribed by the corporation.
Sec. 16. A person that proposes to make a qualified investment
in Indiana must apply to the corporation for the credit under this
chapter before the person makes the qualified investment, and the
corporation and the person may enter into an agreement under
which the person will be awarded a credit in accordance with this
chapter. The corporation shall prescribe the form of the
application used under this section.
Sec. 17. After receiving an application under section 16 of this
chapter, the corporation may enter into an agreement with the
applicant under section 18 of this chapter and award a credit to the
applicant if the corporation determines that all the following
(1) The applicant's proposed investment is a qualified
(2) The applicant's project is economically sound and will
benefit the citizens of Indiana by providing alternative energy
(3) Awarding the credit will result in an overall positive fiscal
impact to the state, as certified by the budget agency using the
best available data.
Sec. 18. An applicant, to be awarded a credit under this chapter,
must enter into a written agreement with the corporation under
this section. The agreement must include all the following:
(1) A detailed description of the project that is the subject of
(2) The first taxable year for which the credit may be claimed.
(3) The maximum credit amount that will be allowed for each
(4) A requirement that the applicant obtain from the
commission a certificate under IC 8-1-8.5-2 that public
convenience and necessity require or will require the
construction, purchase, or lease of the project.
(5) A requirement that if the credit is awarded, the holder of
the credit shall provide written notification to the corporation
under section 21(c) of this chapter not less than thirty (30)
days before assigning any part of the credit to an assignee.
(6) Any other performance conditions that the corporation
determines to be appropriate.
Sec. 19. (a) The corporation shall issue to a person awarded a
credit under this chapter a certificate of verification that certifies:
(1) the percentage of the person's qualified investment that is
eligible for a credit under this chapter; and
(2) the amount of the credit.
(b) In determining the credit amount that should be awarded to
a person under this chapter, the corporation shall grant a credit
only for the amount of the person's qualified investment that is
directly related to promoting projects in Indiana.
Sec. 20. A taxpayer that is the holder of a credit awarded under
this chapter for a qualified investment in a project is entitled to a
credit against the taxpayer's state tax liability in the taxable year
in which the project is placed in service if the taxpayer complies
(1) the conditions set forth in this chapter; and
(2) the agreement with the corporation entered into under
section 18 of this chapter concerning the qualified investment.
Sec. 21. (a) The holder of a credit may assign any part of the
credit to which the holder is entitled under this chapter to another
person if the holder complies with this section.
(b) The assignor must provide the assignee with a copy of the
certificate of verification provided by the corporation under
section 19 of this chapter.
(c) The assignor must provide written notification of the
assignment to the corporation not less than thirty (30) days before
(d) If any part of a credit is assigned under this section, the
assignor and the assignee shall report the assignment on their state
tax return for the year in which the assignment is made, in the
manner prescribed by the department.
(e) The taxpayer assigning a credit under this section shall not
receive value in connection with the assignment that exceeds the
value of the part of the credit assigned.
Sec. 22. (a) The holder of a credit that is assigned in conformity
with this chapter is entitled to a credit against the holder's state tax
liability to the same extent as if the holder were the person to which
the credit was awarded.
(b) A credit that is assigned under this chapter remains subject
(1) this chapter; and
(2) the terms and conditions of the agreement with the
corporation entered into under section 18 of this chapter
concerning the qualified investment.
Sec. 23. If a pass through entity is the holder of a credit and does
not have a state tax liability against which the credit may be
applied, a shareholder, partner, or member of the pass through
entity is entitled to a credit equal to an amount permitted by an
agreement between the partners, members, or shareholders or in
an amount equal to:
(1) the 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
Sec. 24. A taxpayer may not carry over to a succeeding taxable
year or carry back to a previous taxable year any part of the credit
awarded under this chapter that exceeds the taxpayer's state tax
liability for the taxable year for which the credit is awarded. A
taxpayer is not entitled to a refund of any unused credit.
Sec. 25. A taxpayer claiming a credit under this chapter shall
submit to the department a copy of the certificate of verification
issued by the corporation under section 19 of this chapter for the
credit for each taxable year the taxpayer claims a credit. However,
failure to submit a copy of the certificate of verification does not
invalidate a claim for a credit if the taxpayer provides a copy of the
corporation's certificate upon the department's request for
verification of the credit.
Sec. 26. (a) If the corporation determines that a person that was
awarded a credit under this chapter has not complied with:
(1) the requirements of the agreement with the corporation
entered into under section 18 of this chapter; or
(2) any of the provisions of this chapter;
the corporation shall, after giving the person an opportunity to
explain the noncompliance, notify the department of the
noncompliance and request an assessment.
(b) After receiving notice of a person's noncompliance under
subsection (a), the department, with the assistance of the
(1) determine the amount of the assessment to be imposed on
the person, which may not exceed the sum of any previously
allowed credits under this chapter; and
(2) make an assessment under IC 6-8.1.
(c) An assessment may be made under this section against any
taxpayer that applied any part of the credit against any of the
taxpayer's state tax liability. The amount assessed against a
taxpayer may not exceed the amount of the credit applied by the
taxpayer against the taxpayer's state tax liability.
Sec. 27. (a) On or before March 31 of each year, the corporation
shall submit a report on the tax credit program under this chapter
to the office. The report must include:
(1) information on the number of agreements that were
entered into under this chapter during the preceding calendar
(2) a description of the project that is the subject of each
(3) an update on the status of projects under agreements
entered into before the preceding calendar year; and
(4) the sum of the credits awarded under this chapter.
(b) A copy of the report prepared under this section shall be
transmitted in an electronic format under IC 5-14-6 to the
executive director of the legislative services agency for distribution
to the members of the general assembly.
Sec. 28. (a) The corporation shall provide for an evaluation of
the tax credit program on a biennial basis. The evaluation:
(1) must include an assessment of:
(A) the effectiveness of the program in fostering
investment in the generation of energy from renewable
resources in Indiana; and
(B) the revenue impact of the program; and
(2) may include a review of the practices and experiences of
other states with similar programs.
(b) The corporation shall submit a report on each biennial
evaluation to the governor, the president pro tempore of the senate,
and the speaker of the house of representatives after June 30 and
before November 1 in each odd-numbered year. The report
provided to the president pro tempore of the senate and the
speaker of the house of representatives must be in an electronic
format under IC 5-14-6.