2023 Indiana Code › Title 6. Taxation › Article 8.1. Department of State Revenue; Tax Administration › Chapter 9. Refunds › 6-8.1-9-2. Excess Tax Payments; Procedure for Credit or Refund; Pass Through Entities

Sec. 2. (a) If the department finds that a person has paid more tax for a taxable year than is legally due, the department shall apply the amount of the excess against any amount of that same tax that is assessed and is currently due. The department may then apply any remaining excess against any of the listed taxes that have been assessed against the person and that are currently due. Subject to subsection (c), if any excess remains after the department has applied the overpayment against the person's tax liabilities, the department shall either refund the amount to the person or, at the person's request, credit the amount to the person's future tax liabilities.
(b) Subject to subsection (c), if a court determines that a person has paid more tax for a taxable year than is legally due, the department shall refund the excess amount to the person.
(c) As used in this subsection, "pass through entity" means a corporation that is exempt from the adjusted gross income tax under IC 6-3-2-2.8(2), a partnership, a limited liability company, or a limited liability partnership and "pass through income" means a person's distributive share of adjusted gross income for a taxable year attributable to the person's interest in a pass through entity. This subsection applies to a person's overpayment of adjusted gross income tax for a taxable year if:
(1) the person has filed a timely claim for refund with respect to the overpayment under IC 6-8.1-9-1;
(2) the overpayment:
(A) is with respect to a taxable year beginning before January 1, 2009;
(B) is attributable to amounts paid to the department by:
(i) a nonresident shareholder, partner, or member of a pass through entity;
(ii) a pass through entity under IC 6-3-4-12 or IC 6-3-4-13 on behalf of a nonresident shareholder, partner, or member of the pass through entity; or
(iii) a pass through entity under IC 6-3-4-12 or IC 6-3-4-13 on behalf of a nonresident shareholder, partner, or member of another pass through entity; and
(3) the overpayment arises from a determination by the department or a court that the person's pass through income is not includible in the person's adjusted gross income derived from sources within Indiana as a result of the application of IC 6-3-2-2(a)(5) and IC 6-3-2-2.2(g).
The department shall apply the overpayment to the person's liability for taxes that have been assessed and are currently due as provided in subsection (a) and apply any remaining overpayment as a credit or credits in satisfaction of the person's liability for listed taxes in taxable years beginning after December 31, 2008. If the person, including any successor to the person's interest in the overpayment, does not have sufficient liability for listed taxes against which to credit all the remaining overpayment in a taxable year beginning after December 31, 2008, and ending before January 1, 2019, the taxpayer is not entitled for any taxable year ending after December 31, 2018, to have any part of the remaining overpayment applied, refunded, or credited to the person's liability for listed taxes. If an overpayment or part of an overpayment is required to be applied as a credit under this subsection to the person's liability for listed taxes for a taxable year beginning after December 31, 2008, and has not been determined by the department or a court to meet the conditions of subdivision (3) by the due date of the person's return for a listed tax for a taxable year beginning after December 31, 2008, the department shall refund to the person that part of the overpayment that should have been applied as a credit for such taxable year within ninety (90) days of the date that the department or a court makes the determination that the overpayment meets the conditions of subdivision (3). However, the department may establish a program to refund small overpayment amounts that do not exceed the threshold dollar value established by the department rather than crediting the amounts against tax liability accruing for a taxable year after December 31, 2008. A person that receives a refund or credit under this subsection shall file a report with the department in the form and in the schedule specified by the department that identifies under penalties of perjury the home state or other jurisdiction where the income subject to the refund or credit was reported as income attributable to that state or jurisdiction.
(d) An excess tax payment that is not refunded or credited against a current or future tax liability within ninety (90) days after the date the refund claim is filed, the date the tax payment was due, or the date the tax was paid, whichever is latest, accrues interest from:
(1) the date the refund claim is filed, if the refund claim is filed before July 1, 2015; or
(2) for a refund claim filed after June 30, 2015, the latest of:
(A) the date the tax payment was due;
(B) the date the tax was paid;
(C) the date the tax return was filed for the period and tax type for which the refund is claimed;
(D) in the case of a refund based on payment of a tax by the taxpayer to another state, country, or locality, the date of such payment of tax to the other state, country, or locality; or
(E) July 1, 2015;
at the rate established under IC 6-8.1-10-1 until a date, determined by the department, that does not precede by more than thirty (30) days, the date on which the refund or credit is made. As used in this subsection, "refund claim" includes a return and an amended return that indicates an overpayment of tax. For purposes of this subsection only, the due date for the payment of the state gross retail or use tax, the oil inspection fee, and the petroleum severance tax is December 31 of the calendar year that contains the taxable period for which the payment is remitted.
(e) A person who is liable for the payment of excise taxes under IC 7.1-4-3 or IC 7.1-4-4 is entitled to claim a credit against the person's excise tax liability in the amount of the excise taxes paid in duplicate by the person, or the person's assignors or predecessors, upon both:
(1) the receipt of the goods subject to the excise taxes, as reported by the person, or the person's assignors or predecessors, on excise tax returns filed with the department; and
(2) the withdrawal of the same goods from a storage facility operated under 19 U.S.C. 1555(a).
(f) The amount of the credit under subsection (e) is equal to fifty percent (50%) of the amount of excise taxes:
(1) that were paid by the person as described in subsection (e)(2);
(2) that are duplicative of excise taxes paid by the person as described in subsection (e)(1); and
(3) for which the person has not previously claimed a credit.
The credit may be claimed by subtracting the amount of the credit from the amount of the person's excise taxes reported on the person's monthly excise tax returns filed under IC 7.1-4-6 with the department for taxes imposed under IC 7.1-4-3 or IC 7.1-4-4. The amount of the credit that may be taken monthly by the person on each monthly excise tax return may not exceed ten percent (10%) of the excise tax liability reported by the person on the monthly excise tax return. The credit may be claimed on not more than thirty-six (36) consecutive monthly excise tax returns beginning with the month in which credit is first claimed.
(g) The amount of the credit calculated under subsection (f) must be used for capital expenditures to:
(1) expand employment; or
(2) assist in retaining employment within Indiana.
The department shall annually verify whether the capital expenditures made by the person comply with this subsection.
(h) An excess tax payment under section 1(k) of this chapter that is not refunded or credited against a current or future tax liability within ninety (90) days after the date the refund claim is filed, the date the tax payment was due, or the date the tax was paid, whichever is latest, accrues interest from April 1, 2020. For purposes of this subsection, a refund claim filed prior to April 1, 2020, shall be treated as filed on April 1, 2020.
As added by Acts 1980, P.L.61, SEC.1. Amended by P.L.6-1987, SEC.13; P.L.92-1987, SEC.11; P.L.48-1994, SEC.2; P.L.28-1997, SEC.27; P.L.111-2006, SEC.10; P.L.182-2009(ss), SEC.257; P.L.293-2013(ts), SEC.32; P.L.242-2015, SEC.40; P.L.146-2020, SEC.45; P.L.159-2021, SEC.36.