Source: http://www.in.gov/legislative/iac/20140625-IR-045140208NRA.xml.html
Timestamp: 2017-08-19 01:58:45
Document Index: 334772537

Matched Legal Cases: ['§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 21', '§ 24', '§ 32', '§ 151', '§ 152', '§ 6', '§ 6', '§ 6', '§ 6', '§ 32']

01-20140104.LOF
Letter of Findings: 01-20140104 Individual Adjusted Gross Income Tax For the Year 2011
I. Adjusted Gross Income Tax – Earned Income Tax Credit.
Authority: IC § 6-3-1-3.5; IC § 6-3-2-1; IC § 6-3.1-21-1 et seq; IC § 6-3.1-21-6; IC § 6-8.1-5-1; Lafayette Square Amoco, Inc. v. Indiana Dep't of State Revenue, 867 N.E.2d 289 (Ind. Tax Ct. 2007); Indiana Dep't. of State Revenue, Sales Tax Division v. RCA Corp., 310 N.E.2d 96 (Ind. Ct. App. 1974); Stinson Estate v. United States, 214 F.3d 846 (7th Cir. 2000); Income Tax Information Bulletin 92 (May 2012); I.R.C. § 21; I.R.C. § 24; I.R.C. § 32; I.R.C. § 151; I.R.C. § 152.
Taxpayer protests that the Department incorrectly reduced her Indiana Earned Income Tax Credit which she claimed on her 2011 Indiana Individual Income Tax Return.
Taxpayer, an Indiana resident, filed her 2011 federal and Indiana returns as head of household with two children ("Child 1" and "Child 2"). Taxpayer is divorced from the father of Child 1 and Child 2. Taxpayer took the Earned Income Tax Credit ("EITC") on the returns because she was the custodial parent of her two children ("Child 1" and "Child 2"). The Indiana Department of Revenue ("Department") investigated the Indiana return and reduced Taxpayer's Indiana EITC because the Department believed that she and her former spouse both claimed EITC on Child 2. Taxpayer protests that she is allowed the EITC as filed. A hearing was held on Taxpayer's protest and this Letter of Findings ensues. Additional facts will be provided as necessary.
For income tax purposes, Indiana follows the federal tax scheme with certain modifications. IC § 6-3-2-1(b); IC § 6-3-1-3.5(b). Indiana also provides tax credits which a taxpayer may claim to reduce its taxable income. One of the tax credits Indiana provides is the EITC under IC § 6-3.1-21-1 et seq.
Similar to deductions, exemptions, and exclusions, tax credits "are matters of legislative grace." Stinson Estate v. United States, 214 F.3d 846, 848 (7th Cir. 2000). The taxpayer who claims a tax credit is required to retain records necessary to substantiate a claimed credit. Where such a credit is claimed "the party claiming the same must show a case, by sufficient evidence, which is clearly within the exact letter of the law." Indiana Dep't. of State Revenue, Sales Tax Division v. RCA Corp., 310 N.E.2d 96, 101 (Ind. Ct. App. 1974).
As a preliminary matter, Taxpayer should note that according to IC § 6-3.1-21-6(a) and Income Tax Information Bulletin 92 (May 1, 2012), 20120425 Ind. Reg. 045120184NRA, the Indiana EITC was to be calculated based on I.R.C. § 32 as it existed before being amended by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010:
Therefore, all references to federal EITC law are to the 2001 laws, which were the most recent laws updated prior to the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.
Composed: Aug 18,2017 9:58:44PM EDT