Saturday, August 19th, 2017

State and Local Incentives

State Incentives

Many business tax incentives, corporate tax credits, and economic development programs for companies creating new jobs and investment in our state

Corporate income tax decreasing from 6.5% to 4,9% by 2021 with tax rates dropping each year, and a flat state corporate tax rate on adjusted gross income & no gross receipts tax nor inventory tax

  • Economic Development for a Growing Economy (EDGE) Tax Credit
    • Incentive to businesses to support jobs creation, capital investment, and improve the standard of living for Indiana residents
    • Refundable corporate income tax credit calculated as percentage of expected increased tax withholdings generated from new jobs creation
    • Phased in annually for up to 10 years, based on employment ramp-up
  • Hoosier Business Investment Tax Credit (HBITC)
    • Non-refundable corporate income tax credits calculated as a percentage of the eligible capital investment to support the project
    • Certified annually, based on phase-in of eligible capital investment, over period of two full years from commencement of project
  • Skills Enhancement Fund (SEF)
    • To support training and upgrading skills of employees required to support new capital investment
    • Reimburse a portion (typically ~50%) of eligible training costs over period of two full years from commencement of project
  • Headquarters Relocation Tax Credit
    • For corporations that relocate their headquarters to Indiana
    • Assessed against the corporation’s state tax liability
  • Research & Development Tax Credit
    • Two tax incentives
      • Credit against their Indiana state income tax liability – calculated as percentage of qualified research expenses
      • Refunded sales tax paid on purchases of qualified research and development equipment
    • Overseen by Indiana Department of Revenue
  • Patent Income Exemption
    • Certain income derived from qualified patents and earned by a taxpayer exempt from taxation
    • Includes only utility patents and plant patents
    • May not exceed $5 million

Source: Indiana Economic Development Corporation