indiana legislative update

2014 Edition

In This Issue:

Welcome Message
A popular reality show features the tagline, “Expect the unexpected!” Well, the same can be said for this past session of the Indiana legislature. Not that the Indiana General Assembly resembles reality TV – except for the nonstop drama, behind-the-scenes deal-making, fights between family members, and legislators facing the threat of being voted off the island (i.e., out of office). Still, much of what happened in 2014 was unexpected. By Tim C. Cook, JD

Sales and Use Tax
Ind. Code § 6-2.5-2-2 (amendment), effective July 1, 2014, and enacted by Senate Bill 161, permits a seller to round sales tax on an item basis or invoice basis and also restricts a seller from using an item basis to circumvent tax that would be imposed if an invoice basis were used. By Donna L. Niesen, CPA

Income Tax
Ind. Code § 6-3-2-1 (amendment), effective July 1, 2014, and enacted by Senate Bill 1, reduces the corporate income tax rate by continuing the stair-stepped reductions already in place. Upon completion of the reductions, the new rate will be lowered from 6.5% to 4.9%. This is accomplished through 0.25% reductions from 2016 to 2020 with a final reduction of 0.35% in 2021. By Donna L. Niesen, CPA, and Amy Zimmer

Economic Development and Tax Credits
Ind. Code § 2-5-3.2-1 to 2-5-3.2-1 (addition), effective July 1, 2014, enacted by House Bill 1020, directs the Commission on State Tax and Financing Policy to conduct a detailed review of all tax incentives, defined broadly to include exemptions, deductions, preferential rates, or other tax benefits that reduces a tax burden. Requires incentive programs to be reviewed at least once every five years from the effective date to 2023. By Tim C. Cook, JD, 

Property Tax
Ind. Code § 6-1.1-1-2 (amendment) & 6-1.1-2-1.5 (addition), effective July 1, 2014, enacted by Senate Bill 420, moves the assessment date for tangible property from March 1 to Jan. 1 beginning in 2016. Moves the assessment date for mobile homes from Jan. 15 to Jan. 1 beginning in 2017. By Chad Miller and Heather Judy, CPA

Other Taxes and Unclaimed Property
Ind. Code § 5-14-3-4 (amendment), effective upon passage, enacted by Senate Bill 208, prohibits certain information included in a report of unclaimed property from being disclosed under Indiana’s access to public records law. Excluded information includes date of birth, driver’s license number, taxpayer identification number, employer identification number and account numbers. By Tim C. Cook, JD,

Local Taxation
Ind. Code § 6-3.5-1.1-9 (amendment), effective July 1, 2014, enacted by Senate Bill 176, adds the requirement that a pledge of County Adjusted Gross Income Tax (CAGIT) revenues must have been for property tax relief or public safety. By Donna L. Niesen, CPA, and Amy Zimmer

Tax Administration
Ind. Code § 6-8.1-4-4 (amendment), effective July 1, 2014, enacted by House Bill 1380, permits the commissioner of the Department of State Revenue to deny or suspend certain vehicle permits if escort fees to the state police department are delinquent. By Donna L. Niesen, CPA

Insider Insights
KSM recently partnered with the Indiana Manufacturers Association (IMA) on the 2013 Indiana Manufacturing Survey, an annual taking-of-the-temperature of manufacturers across Indiana. Given the tax-centric findings contained in this year’s survey, we thought it would be enlightening to discuss the results of the survey, and other Indiana tax issues, with an expert in tax policy. With this goal in mind, we were fortunate that Tim Rushenberg, vice president of Governmental Affairs & Tax Policy for the IMA, agreed to share his insights with us. 


Katz, Sapper & Miller’s 2014 Indiana Legislative Update summarizes the tax and economic development legislative changes that occurred in the Indiana General Assembly.