Indiana Current Year S Corporation Income Tax Booklet with Forms and Schedules

Current Year S Corporation Income Tax Booklet with Forms and Schedules
IT-20S S Corporation Income Tax Booklet
INDIANA

2 0 2 4

IT-20S

S Corporation Income Tax Booklet

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IT-20S S Corporation Booklet 2024

SP 261
(R30 / 12-24)

INDIANA IT-20S
S Corporation Income Tax Booklet Year 2024
Contents

What’s New for 2024...............................................................................................................................................................4
General Information...............................................................................................................................................................4
General Filing Instructions....................................................................................................................................................5
Instructions for Completing Form IT-20S...........................................................................................................................7
Summary of Calculations ....................................................................................................................................................11
Certification of Signatures and Authorization Section....................................................................................................14
Mailing Options.....................................................................................................................................................................14
Instructions for Schedule E, Apportionment of Income for Indiana.............................................................................14
Instructions for Completing Schedule PTET....................................................................................................................16
Instructions for Schedule Composite.................................................................................................................................17
Instructions for Schedule IN K-1........................................................................................................................................19
Reminders..............................................................................................................................................................................27
Additional Information........................................................................................................................................................27

IT-20S S Corporation Booklet 2024

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INTIME e-Services Portal Available

INTIME, DOR’s e-services tax portal available at intime.dor.in.gov,
provides the following functionalities for IT-20S customers:
•	 Make payments using a bank account or credit card
•	 View and respond to correspondence from DOR
•	 Request and print return transcripts on-demand
•	 Electronic delivery of correspondence
•	 Online customer service support through secure messaging

Increased Online Support for Tax Preparers

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A new credit, Health Reimbursement Arrangement Credit
(878), is available for certain employers who create health
reimbursement arrangements for their employees in 2024 or
later. See page 24 for additional information.
A new credit, Historic Rehabilitation Tax Credit (879),
is available for taxpayers who incur approved qualified
rehabilitation expenditures for the restoration and
preservation of qualified historic structures. See page 25 for
additional information.

In addition to the functionality listed above, INTIME provides
increased access and functionality for tax preparers. INTIME
provides the following functionality for tax preparers:
•	 Gain access to view and manage multiple customers under one
login
•	 Ability to file returns, make payments, and view file and pay
history for clients
•	 Request electronic power of attorney (ePOA) authorization to
view customer accounts
•	 View and respond to correspondence for clients

Other Changes

We strongly encourage all taxpayers to make payments and file
returns electronically whenever possible. INTIME allows customers
to make estimated payments electronically with just a few clicks.

General Information

What’s New for 2024
References to the Internal Revenue Code

The definition of adjusted gross income (AGI) is updated to
correspond to the federal definition of adjusted gross income
contained in the Internal Revenue Code (IRC). Any reference
to the IRC and subsequent regulations means the Internal
Revenue Code of 1986, as amended and in effect on Jan. 1,
2023. For a complete summary of new legislation regarding
taxation, please see the 2024 Legislative Synopsis at
www.in.gov/dor/files/2024-legislative-synopsis.pdf.

Credits
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A new credit, Attainable Homeownership Tax Credit (875),
is available for certain contributions to Habitat for Humanity
of Indiana. See page 21 or additional information.
A new credit, Benefit Corporation Employment of
Individuals with Disability Tax Credit (881), is available
for benefit corporations who hire new employees with
disabilities and are placed with the benefit corporations
through a vocational rehabilitation program. See page 21
for additional information.
A new credit, Employer Child Care Expenditure Credit
(876), is available for employers who make qualified
expenditures related to the construction of child care
facilities for employees’ children. See page 22 for additional
information.
A new credit, Employment of Individuals with Disability
Tax Credit (877), is available for employers who hire new
employees with disabilities and are placed with the employer
through a vocational rehabilitation program. See page 23
for additional information.

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IT-20S S Corporation Booklet 2024

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Schedule IN-OCC Form Changes. For 2024, Schedule INOCC includes a new Part B. Part B is used to report:
ο	 Any credits that are being carried forward from previous
years.
ο	 Any credits that are not fully used and being carried
forward to future years.
ο	 Any credits that are not fully used, even if the credit is
not available for future carryforward.

Annual Public Hearing

In accordance with the Indiana Taxpayer Bill of Rights, the Indiana
Department of Revenue (DOR) will conduct an annual public
hearing in Indianapolis in June of 2025. Event details will be listed
at www.in.gov/dor/about/news-publications/public-hearings.
Please come and share feedback or comments about how DOR
can better administer Indiana tax laws. If you cannot attend, please
submit feedback or comments in writing to: Indiana Department
of Revenue, Commissioner’s Office, MS# 101, 100 N. Senate
Avenue, Indianapolis, IN 46204.

Who Must File and When

Any S corporation doing business in Indiana and deriving gross
income from sources within Indiana must file an annual return,
Form IT-20S, with DOR. It also must file information returns
(Schedule IN K-1s) disclosing each shareholder’s distributive
share of the S corporation’s income whether distributed or
undistributed. These forms are due on or before the 15th day of
the 4th month following the close of the S corporation’s tax year.
If filing by paper, enclose the first five pages of the U.S. Income
Tax Return for an S corporation (Form 1120S) and Schedule M-3.
Federal Schedules K-1 should not be enclosed but must be made
available for inspection upon request by DOR.

Doing Business in Indiana

For Indiana adjusted gross income (AGI) tax purposes, the term doing
business generally means the operation of any business enterprise or
activity in Indiana, including but not limited to the following:
•	 Maintenance of an office, a warehouse, a construction site, or
another place of business in Indiana;
•	 Maintenance of an inventory of merchandise or material for
sale, distribution, or manufacture, or consigned goods;
•	 The sale or distribution of merchandise to customers directly
from company-owned or -operated vehicles when the title of
merchandise is transferred from the seller or distributor to
the customer at the time of sale or distribution;

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The rendering of a service to customers in Indiana;
The ownership, rental, or operation of a business or property
(real or personal) in Indiana;
Acceptance of orders in Indiana with no right of approval or
rejection in another state;
Interstate transportation; and
Maintenance of a public utility.

S Corporation Filing Requirements

Corporations that are permitted to and do file in accordance
with Section 1361(a)(1) of the Internal Revenue Code (IRC) are
exempt from the Indiana adjusted gross income tax for any tax
period for which the election is in effect, except on passive income
and built-in gains.
Note. S corporation elections cannot be made retroactively.
Qualifications under Indiana law for filing S corporation returns
are essentially the same as in the IRC. However, the corporation
must file Form IT-20S and meet the withholding requirements for
nonresident shareholders under Indiana Code (IC) 6-3-4-13.
To the extent a qualified S corporation’s income is exempt for
federal purposes, the AGI tax will not be assessed against the S
corporation. An S corporation failing to withhold for nonresident
shareholders will be subject to the penalty provided by IC 6-8.110-2.1(h), instead of losing its tax exemption. This penalty is 20%
of the amount of tax required to be withheld and paid under IC
6-3-4-13. In addition, there is a penalty of $10 for each failure to
timely file an information return, Schedule IN K-1. Corporations
filing for the first time must enclose a copy of the approval letter
from the Internal Revenue Service granting the S election.

Calculating Corporate Income Tax Rate
The corporate AGI tax rate is 4.9%.

General Filing Instructions
Liability of the S Corporation

S corporations as entities generally are not subject to an income or
financial institution tax.

An S corporation that has nonresident shareholders must file
a composite return for all its nonresident shareholders. A $500
penalty will be assessed to any S corporation that fails to file a
composite return that includes all nonresident shareholders (PL
211-2007 SEC. 27, 44, 58).
Any passive income and built-in gains of an S corporation that
are subject to tax under provisions of the IRC will be subject to
Indiana adjusted gross income tax. See the instructions for Form
IT-20S Schedule B beginning on page 11.
A corporation is not required to file quarterly estimated payments
if its annual unpaid liability is less than $2,500. Estimated tax
payments must be submitted with the Indiana corporation’s
quarterly income tax return or by electronic funds transfer (EFT).
Corporations required to make quarterly estimated payments
can use the annualized income installment method calculated in
the manner provided by IRC Section 6655(e) as applied to the
corporation’s AGI tax liability.
The threshold for required EFT payments for corporate estimated
taxes is $5,000. Estimated payments of less than $5,000 can be
made by EFT but are not required to be made by EFT. Estimated
tax payments and withholding/composite tax payments can be
made via INTIME, DOR’s e-service portal at intime.dor.in.gov.
Failure to submit a required quarterly payment electronically
will result in a penalty of 10% being assessed at the time the
annual income tax return is filed. The penalty is computed on
each payment required to be made electronically that is instead
submitted by another means.
Corporate filers (whether filing on a calendar-year, fiscal-year, or
short-tax-year basis) must remit by the 20th day of the 4th, 6th,
9th, and 12th months of the corporation’s tax periods. For more
details, see Income Tax Information Bulletin #11 at
www.in.gov/dor/files/ib11.pdf.
To avoid costly penalty and interest charges for delinquent filing
of returns, an S corporation should verify its tax status and
withholding responsibilities before conducting business in Indiana.

Withholding Tax Liabilities of S Corporations

S corporations are considered to be the taxpayer with respect to
the payment of amounts withheld on nonresident shareholders’
distributive shares. See the section titled “Withholding Tax
Liabilities of S Corporations” for more information.

The following instances obligate the S corporation to register with
DOR and become an Indiana withholding agent on behalf of each
of the following.

S corporations are subject to the use tax. Use tax is due on the
storage, use, or consumption of tangible personal property
purchased in a transaction in Indiana or elsewhere. The only
exceptions are if;
•	 The transaction is exempted from the sales and use tax by law; or
•	 The sales tax due and paid on the transaction equals the use
tax due.

S corporations making payments of salaries, wages, tips, fees,
bonuses, and commissions that are subject to Indiana state and/
or county income taxes and are required by the IRC to withhold
federal taxes on those types of payments are also required to
withhold on those payments for Indiana tax purposes.

The apportionment Schedule E must be included with the return
if the S corporation is doing business both within and outside
Indiana and has any shareholders not domiciled in Indiana. See
the instructions for Schedule E beginning on page 14.

Withholding on Employees

Withholding on the compensation of nonresident team members
of certain professional sports organizations is based on duty days
performed in Indiana. Refer to Income Tax Information Bulletin
#88 at www.in.gov/dor/files/ib88.pdf. If an employee resides in a
state that has a reciprocal agreement with Indiana, the employee
is exempt from Indiana state income tax but is subject to the
relevant county tax.
IT-20S S Corporation Booklet 2024

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An S corporation with an employee withholding liability must
register as an Indiana withholding agent. DOR assigns an Indiana
Taxpayer Identification Number (TID).

Withholding for Arizona residents is required, but only to the
extent of the difference between Indiana’s adjusted gross income
tax rate and Arizona’s 2.5% individual income tax rate.

The S corporation has two options in registering as an Indiana
withholding agent:
•	 Register with DOR online using INBiz (inbiz.in.gov); or
•	 Visit either DOR’s downtown Indianapolis office or one of the
district offices located throughout the state.

S corporations must withhold at the county’s relevant tax rate on each
Indiana nonresident shareholder whose principal place of business or
employment on Jan. 1 is located in an Indiana county. See Schedule
CT-40PNR, page 2, at www.in.gov/dor/tax-forms/individual/current
to get the county’s tax rate.

Payments of amounts withheld must be remitted to DOR via
electronic method by the due date. If a filing and/or payment of
the proper amount of tax withheld is not made by the due date,
penalty and interest will be added. A person responsible for
remitting payments is personally liable for the tax to be remitted,
and may be subject to criminal prosecution if the failure to pay
and/or file a withholding return is due to fraud or tax evasion.
Businesses can file and pay withholding taxes via INTIME at
intime.dor.in.gov or a third-party vendor. INTIME can also be
used to file and remit sales tax.

Trusts and Estates. S corporations must withhold on the amount
it pays or credits as dividends or for the shareholder’s distributive
share derived from Indiana sources to any of its nonresident
shareholders that are trusts, estates, and nonprofit organizations
not domiciled in Indiana. This amount must reflect the ultimate
tax liability due Indiana by the respective member or beneficiary
because of the S corporation’s activities.

Withholding on Shareholders

An S corporation must withhold tax on the amount it pays or
credits as dividends or for the shareholder’s distributive share
derived from Indiana sources to any of its nonresidents that are
fiduciaries. Then, a trust or estate must also withhold state income
taxes for all its nonresident beneficiaries.

An S corporation must withhold state income tax at the individual
income tax rate on the amount it pays or credits to any of its
nonresident shareholders on the shareholder’s distributive share
of the income derived from Indiana sources regardless of whether
distributions were made.
IC 6-3-4-13 provides that all nonresident shareholders must be
included in a composite return schedule, and the S corporation
must continue to withhold Indiana adjusted gross income tax
for all nonresident shareholders. Unless a shareholder completes
Schedule IN-COMPA or DOR grants express permission for
alternative withholding, there is no provision for a shareholder to
opt out of withholding. However, even if the shareholder opts out of
withholding or DOR grants alternative withholding arrangements,
there is no provision for not including a nonresident shareholder
on Schedule Composite. Each nonresident shareholder’s composite
tax is calculated at the relevant tax rate. DOR has streamlined the
procedure for making withholding payments for nonresidents.
Failure to include all non-residents on the composite schedule
subjects the S corporation to a penalty of $500 in addition to the
20% penalty for failure to withhold. Voluntary payment of the $500
penalty does not relieve the S corporation from the obligation to
withhold and remit composite tax due.
See page 4 for information about using INTIME, DOR’s
e-services portal at intime.dor.in.gov, for making withholding
remittances. Credit for the withholding/composite tax will be
reflected on Schedule IN K-1 for each shareholder. For further
information, consult Income Tax Information Bulletin #72, which
is available at www.in.gov/dor/files/ib72.pdf.
The withholding requirement does not apply to residents of
reverse credit states and who are subject to and pay income taxes
at rates equal to or greater than Indiana’s individual income tax
rate to the resident states. The relevant reverse credit states are:
•	 Oregon and
•	 Washington, D.C.
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IT-20S S Corporation Booklet 2024

Note. The withholding provisions do not apply to nonresident
shareholders who are nontaxable trust or estate entities.

Withholding Amounts on Nonresident Shareholders.
Withholding amounts should be remitted by using Form IT-6WTH.
A penalty will be assessed if an S corporation should have withheld
but did not. The penalty is 20% of the amount required to be
withheld. If the payment is late, it is also subject to interest in addition
to the amount withheld or required to be withheld and paid to DOR.
If a distribution to nonresident shareholders is made with property
other than money, or a gain is realized without the payment of
money, the corporation may not release the property or credit the
gain until it has funds sufficient to pay the withholding tax due.
Note. Shareholders not domiciled in Indiana must meet annual
filing requirements and remit all unpaid tax, penalties, and interest.

Accounting Periods and Methods

The accounting period for Form IT-20S and the method of
accounting adopted must be the same as used for federal income
tax purposes

Extended Filing Due Date

The initial due date for filing is the 15th day of the 4th month
following the close of the S corporation’s tax year. DOR accepts
the federal extension of time application (Form 7004) and the
federal electronic extension. If a taxpayer has an extension,
there is no need to contact DOR before filing the annual return.
Returns postmarked within one month after the last date
indicated on the federal extension will be considered timely filed.
Do not file a separate copy of this federal extension form with DOR
to request an Indiana extension at the time the extension is requested.
Instead, enclose a copy of the federal extension of time when filing
the state return and check box R on the front of Form IT-20S.

If a federal extension is not requested, an Indiana extension of
time to file (and payment) can be requested via INTIME, DOR’s
e-service portal at intime.dor.in.gov, or by submitting a request in
writing to: Indiana Department of Revenue, Corporate Income Tax,
Tax Administration, P.O. Box 7206, Indianapolis, IN 46207-7206.
Extensions of time to file are applicable to the filing of the return
only and not to any tax liability due. Any payments made after the
original due date must include penalty and interest.

Amended Returns

Both the S corporation and the shareholders must file amended
Indiana returns within 180 days after the filing of the amended
federal return if:
•	 The S corporation files an amended federal return; and
•	 The change(s) affects the Indiana income or the taxable
income reportable by the shareholders.
An adjustment made by the Internal Revenue Service affecting the
reportable Indiana income must be reported to Indiana with an
amended S corporation return. This must be done within 180 days
after the IRS adjustment becomes final.

Subsidiary (QSSS) must enclose a statement (or federal Form
8869) showing the name, address, and federal ID number of
the owned S corporation(s) included in this return or enclose a
completed Schedule 8-D.
County Code Number. List the two-digit county code number
if filing a return for a corporate address in Indiana. See
Departmental Notice #1 located at www.in.gov/dor/files/dn01.pdf
for a list of county codes. Enter “00” (two zeroes) in the county
box D if corporate address lies outside of Indiana.
Enter the principal business activity code from the North
American Industry Classification System (NAICS), in the
designated block of the return. Use the six-digit activity code
reported on the federal corporation income tax return.

Questions A through L and Other Fill-in Lines

All corporations filing an Indiana corporation income tax return
must complete the top portion of the form, including questions A
through L. Check or complete all boxes that apply.
A.	 Indicate the date and state of incorporation.

Check the box at the top of Form IT-20S if filing an amended
return.

B.	 Indicate the state of the corporation’s commercial domicile.

Instructions for Completing Form IT-20S

D.	 Indicate the accounting method used.

Filing Period and Identification

E.	 Indicate the date of election as an S corporation.

For a fiscal or short tax year, provide both the beginning month, day,
and year and the ending month, day, and year at the top of the form.

F.	 Check the “final return” box only if the corporation is dissolved,
liquidated, or has withdrawn from the state. File Form BC100 to close out any sales and withholding accounts. Use
INTIME, DOR’s e-services portal at intime.dor.in.gov, to
complete this request online.
•	 Check “In Bankruptcy” if the corporation is undergoing
bankruptcy.
•	 Check “Composite Return” if filing and attach a Schedule
Composite for nonresident shareholders.
•	 Check “PTET Return” if you are including a completed
Schedule PTET with this return.

Use Form IT-20S to file:
•	 A 2024 corporation return for a tax year ending Dec. 31, 2024;
•	 A short tax year beginning and ending in 2024; or
•	 A fiscal year beginning in 2024 and ending in 2025.

Please use the corporation’s full legal name and present mailing
address.
For foreign addresses, please note the following:
•	 Enter the name of the city, town, or village in the box labeled
City;
•	 Enter the name of the state or province in the box labeled
State; and
•	 Enter the postal code in the box labeled ZIP Code; and
•	 Enter the 2-digit country code.
Check the box at the top of the form if filing an amended return.
For a name change, check the box at the top of the return. If filing
by paper, enclose with the return copies of amended Articles
of Incorporation or an Amended Certificate of Authority filed
with the Indiana Secretary of State.
The federal employer identification number shown in the box
in the upper-right corner of the return must be accurate and the
same as used on the U.S. Income Tax Return for an S Corporation.
The reporting corporation with a Qualified Subchapter S

C.	 Indicate the year the initial Indiana return was filed.

G.	 Enter the total number of shareholders of the corporation in
field one of question G. Enter the number of all shareholders
who are nonresidents of Indiana in field two of question G.
H.	 Check this box if the corporation has a valid extension of
time or an electronic federal extension of time to file the
return. If applicable, enclose a copy of federal Form 7004
when filing the state return.
I.	

Check this box if this corporation filed as a C corporation for
the prior tax year.

J.	

Check this box if this corporation is a member of any
partnership.

K.	 Check this box if income is reported from disregarded entities.
If this box is checked, please enclose a list of the disregarded
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entities with the return. If filing electronically, please complete
the disregarded entity portion of the federal recap schedule(s).
L.	 Check this box if claiming a research expense credit, and
enclose Schedule IT-20REC.

Schedule A – S Corporation Adjusted Gross Income
Note. Please round all entries to the nearest whole dollar amount.
Also, please do not use a comma in dollar amounts of four digits
or more. For example, instead of entering “3,455” enter “3455.”
Line 1. Enter the amount from the federal S Corporation Return
Schedule K:
•	 Net ordinary business income;
•	 Net income from real estate activities from Form 882;
•	 Other rental income activities;
•	 Portfolio income and deductions;
•	 Royalties;
•	 Capital gains and losses; and
•	 Other income.
The amount should total the net income (loss) from Schedule K,
line 1 through line 10, less line 11 and a portion of line 12 related
to investment income (see below).
The Section 179 deduction and that portion of investment
expenses included in federal Schedule K, part of line 12, and line
17 relating to investment portfolio (royalty) income, flowing
through to federal Schedule E, may be tentatively deducted. Do
not deduct other expenses treated as federal itemized deductions.
Use the Worksheet for S Corporation Distributive Share of
Income, Deductions, and Credits to assist in this calculation. The
income worksheet must be used if the corporation received any
distributive income from an owned partnership interest, estate, or
trust. See the worksheet on page 13.

Indiana State Modifications, Lines 2a through 2f

Enter any add-backs and deductions on lines 2a through 2f. Enter
the name of the add-back/deduction, its 3-digit code, and its
amount. Use a minus sign to denote negative amounts. Attach
additional sheets if necessary.

Adding Back Depreciation Expenses

Several of the discontinued add-backs were created by timing
differences between federal and Indiana allowable expenses.
Following is an example of how to report a difference.
Example. ABC Company has qualified restaurant equipment. For
federal tax purposes, they use the accelerated 15-year recovery
period for an asset placed in service in 2009. Since 2009, ABC
Company has been adding back the depreciation expense taken
for federal purposes that exceeded the amount allowable for
Indiana purposes. The accumulated depreciation on such an asset
through 2012 is, therefore, different for federal and state purposes.
This difference will remain until the asset is fully depreciated or
until the time of its disposition.
So, in this example, the asset was acquired in Jan. 2009 at a
purchase price of $120,000. This normally would have a 25-year
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IT-20S S Corporation Booklet 2024

recovery period, but IRC Sec. 168 allows for a 15-year recovery
period. Tax year 2012 is the last year ABC Company will have
reported a qualified restaurant equipment add-back until the end
of the 15-year recovery period.
If this asset was sold before being fully depreciated (using straightline depreciation), the catch-up modification would be reflected
in the year of the sale. However, if this property is held through
2024 (the 15th year of depreciation), ABC Company will report a
negative $12,800 catch-up add-back on the 2024 state tax return.
Reporting Certain Prior-Year Modifications
In certain cases, a modification in a prior year may have been
limited due to various federal limitations, including basis
limitations, passive loss limitations, and at-risk loss limitations.
Even though certain modifications may not apply to activities
during the current taxable year, you may be required to report a
modification when you have income against which to realize the
modification. Use the modification code for the year in which the
modification was actually accrued.

The following add-backs and deductions should
be entered on lines 2a through 2e.
Conformity Add-Back

Before this publication was finalized Indiana had not conformed
to any changes to the Internal Revenue Code (IRC) that may have
become law after Jan. 1, 2024. Therefore, the IRC used to figure
Indiana income may not wind up being the same as the IRC used
to figure federal income.
This add-back is specific to these annual current year conformity
issues. If uncertainty exists as to whether or not Indiana will adopt
some or all of the federal legislation passed after Jan. 1, 2024,
that acts to modify federal AGI, you may add-back those items
as an “other” add-back. In the event those items are adopted, an
amended return should be filed to recoup the add-back(s).
Conformity Add-Back – Positive Entry (3-digit code 120)
This add-back is only for current year conformity issues.
Conformity issues for preceding tax years must be addressed on
the add-back line specific to the item in question.
If the state legislature does not conform to federal code changes
enacted after Jan. 1, 2024, you may have to amend your return at
a later date to reflect any differences between Indiana and federal
law. You may wish to periodically check for updates at
www.in.gov/dor.
Conformity Add-Back – Negative Entry (3-digit code 147)
This add-back generally is based on conformity issues arising
from a previous year. However, in rare cases this can arise from
conformity issues arising in the current year where the IRC treats
an item as taxable or nondeductible that was previously exempt or
deductible.
One example that occurs periodically is when there is a federal
disaster. Congress will amend the IRC to permit IRA withdrawals
to be included over three years (e.g., a 2024 withdrawal would

be included one-third in 2024, one-third in 2025, and one-third
in 2026). If Indiana decoupled from the IRC, the whole amount
would be included in 2024, none in 2025, and none in 2026. The
Code 120 would be for the two-thirds add-back in 2024, the Code
147 would be for the one-third deduction in 2025 and 2026. These
have occurred from time to time but (1) did not affect Indiana
because of the specific disaster and (2) the IRC conformity date
was updated in time.
Tax Add-Back (3-digit code 100)
Add back all state taxes based on or measured by income, levied
by any state, which were deducted on the federal tax return.
Wagering taxes fall within this category to be added back.
However, the amount to be added back is being phased out. See
the following instructions.
•	

Wagering taxes. The portion of wagering taxes required to be
added back as a tax based on or measured by income is being
reduced (phased out). The percentage of taxes required to be
added back is determined by the first date of the taxpayer’s
taxable year, and is determined as follows: 2019 – 87.5% ;
2020 – 75%; 2021 – 62.5%; 2022 – 50%; 2023 – 37.5% 2024 –
25.0%; 2025 – 12.5%; 2026 and later – no add back required.
For example, Casino X deducts $10,000,000 in riverboat
wagering taxes. Individual owns 10% of Casino X.
Individual’s share of income taxes is $1,000,000. Casino X will
report $2,500,000 as its add back. The Schedule IN K-1 issued
to Individual will reflect $250,000 (or an apportioned share if
Individual is a nonresident).

Note. Income, losses and/or expenses from other schedules and
forms may flow through to federal Schedules C, E and F. For
example, S corporation income from federal Schedule K-1 may
be included on federal Schedule E, while expenses from federal
Form 8829 may be included on federal Schedule C. Make sure to
check these schedules and forms for any deduction that needs to
be added back.
Add-back for Bonus Depreciation (3-digit code 104)
Add or subtract an amount attributable to bonus depreciation.
Do this if it’s in excess of any regular depreciation allowed if
the corporation did not elect under IRC Section 168(k) to have
it applied to property in the year the property was placed into
service. If property is owned, it is possible to have been allowed to
take additional first-year special depreciation for qualified property
in the current taxable year or an earlier taxable year. If this is the
case, add or subtract an amount that makes the AGI equal the
amount computed without applying any bonus depreciation. (The
first-year special depreciation for qualified property includes
100% bonus depreciation.) Calculate the subsequent depreciation
allowance as if the bonus depreciation had been disallowed until
the property is disposed or the property is fully depreciated for
Indiana purposes. Enclose a statement to explain the adjustment
being made. Income Tax Information Bulletin #118 at www.in.gov/
dor/files/ib118.pdf explains this initial required modification on
the allowance of depreciation for state tax purposes and special
rules for certain like-kind exchanges.

Add-back for Section 179 Expense Excess (3-digit code 105)
Add or subtract the amount necessary to make the adjusted gross
income of the taxpayer that placed any IRC Section 179 property
in service in the current taxable year or in an earlier taxable year
equal to the amount of adjusted gross income that would have been
computed as if the federal limit for expensing under IRC section
179 was $25,000 as opposed to $1,000,000 (adjusted for inflation).
Indiana has adopted an expensing cap of $25,000. This
modification affects the basis of the property if a higher Section
179 limit was applied. The federal increase to a $1,000,000
deduction was not allowed for purposes of calculating Indiana
adjusted gross income. However, the $2,500,000 threshold for
phase-out (adjusted for inflation) is allowed for purposes of
calculating Indiana AGI. The depreciation allowances in the
year of purchase and in later years must be adjusted to reflect the
additional first-year depreciation deduction, including the special
depreciation allowance for 100% bonus depreciation property,
until the property is sold or the property is fully depreciated for
Indiana purposes.
Note. The net amount determined for the net bonus depreciation
or the IRC Section 179 add-back might be a negative figure (to
reflect allowable depreciation in subsequent years). If it is, use
a minus sign to denote that. (If the taxable income is a loss, this
adjustment increases a loss when added back.) Enclose a statement
to explain the adjustment. Income Tax Information Bulletin #118
at www.in.gov/dor/files/ib118.pdf explains this initial required
modification on the allowance of depreciation for state tax
purposes and special rules for certain like-kind exchanges.
Add-back of OOS Municipal Obligation Interest (3-digit code 137)
Interest earned from a direct obligation of a state or political
subdivision other than Indiana (out of state, or OOS) is taxable by
Indiana if the obligation is acquired after Dec. 31, 2011. Interest
earned from obligations held or acquired before Jan. 1, 2012, is
not subject to Indiana income tax and should not be reported as
an add-back.
Note. Interest earned from obligations of Puerto Rico, Guam,
Virgin Islands, American Samoa, or Northern Mariana is not
included in federal gross income and is exempt under federal
law. There is no add-back for interest earned on these obligations.
For more information, see Income Tax Information Bulletin #19
available at www.in.gov/dor/files/ib19.pdf.
Federal Repatriated Dividend Deduction Add-Back
(3-digit code 139)
Add back the deduction that flowed through to shareholders on
Line 3 using code 139. Report the add-back to the beneficiaries
using code 139 on Schedule IN K-1. For nonresident individuals,
include only the apportioned amount of the add-back.
Excess Federal Interest Deduction Modification (3-digit code 142)
IRC Section 163(j) limits the federal interest deduction for most
business interest to a portion of adjusted taxable income plus
business interest income. However, Indiana decoupled from this
provision. Subtract an amount equal to the amount disallowed
as a federal deduction for excess business interest in the year in
which the interest was first paid or accrued. Add back any amount
IT-20S S Corporation Booklet 2024

Page 9

of interest previously deducted for Indiana and allowable for
federal purposes in the current taxable year. For shareholders,
the shareholder will be required to compute any add-back at the
shareholder level. For purposes of reporting this modification
and determining composite tax, compute any add-back as if
the S corporation is the only source of the shareholder’s interest
income/deduction.

Infrastructure Fund Gift Deduction (3-digit code 631)
Shareholders or partners may be eligible to claim a deduction if a
contribution has been made to a regional development infrastructure
fund. Record the amount on lines 19-23 of the IN K-1.

Specified Research and Experimental Expenses Add-back
(3-digit code: 154)
If you claimed a federal income tax deduction for specified
research and experimental expenses that are required to be
amortized for federal purposes pursuant to IRC section 174, add
back the amount of expenses you actually deducted for federal
income tax purposes. See the instructions for Code 641 for further
information on the amount of expenses allowable as a deduction.

Indiana-only Tax-exempt Bonds Deduction (3-digit code: 636)
If you had interest from a bond issued by or in the name of certain
Indiana government subdivisions or entities or amounts received
upon redemption or maturity of the bond, deduct any interest or
other income included in federal gross income. Do not deduct
any bond interest that is excluded from federal gross income.
In addition, if you sell the bond, do not deduct any amounts for
which the bond is sold in excess of your purchase price. See IC
6-8-5-1 for further information regarding the deduction.

Note. If after printing of these instructions, IRC Section 174
is amended to allow immediate expensing of research and
experimental expenses and you elect to amortize those expenses,
you cannot use this code and Code 641 to accelerate the
allowance of your expenses.
Example. Corporation DEF incurred $100,000 of specified research
expenses in 2024. Corporation DEF reported $10,000 of amortized
expenses in 2024. Corporation DEF will use Code 154 to add back
the $10,000 claimed for federal purposes and use Code 641 to report
$100,000 allowable for Indiana purposes. For 2025-2029, Corporation
DEF will continue to use Code 154 to report timing differences.
Deduction for interest on U.S. Government Obligations
(3-digit code 610)
Deduct interest income, less related expenses, from certain
obligations of the U.S. government included as income on the
federal return. A listing of eligible items is available in Income Tax
Information Bulletin #19 at www.in.gov/dor/files/ib19.pdf.
Note. Entries made on federal Form 8825 should also be
considered when completing entries on line 2.
Government or Civic Group Capital Contribution Deduction
(3-digit code 633)
Subtract any amount included in federal taxable income that are
capital contributions from a government or civic group and not
excluded under IRC Section 118.
Indiana Lottery Winnings Annuity Deduction (3-digit code 629)
If a taxpayer receives proceeds from a winning Hoosier Lottery
ticket for a lottery held prior to July 1, 2002, those proceeds may
be deducted from the taxpayer’s Indiana adjusted gross income.
This deduction applies only to prizes won from the Hoosier
Lottery Commission; proceeds from other state lotteries or from
other gambling sources, such as casinos, are not deductible. In
addition, proceeds from winning Hoosier Lottery tickets for
lotteries held after June 30, 2002, are not deductible.
Note. Individuals or entities that have purchased Hoosier Lottery
prizes from a winning ticket holder for valuable consideration are
not eligible for this deduction.
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IT-20S S Corporation Booklet 2024

Filers should keep detailed records of the contribution as DOR
can ask filers to provide this information at a later date.

Small Employer Health Insurance Premium Deduction
(3-digit code: 639)
If you:
•	 Claimed a federal tax credit for small employer health
insurance premiums under IRC section 45R; and
•	 Would have been permitted a deduction for those premiums
except for the disallowance under IRC section 280C(h),
you are permitted a deduction for the portion of the premiums
disallowed for federal purposes. Use Code 639 to enter the
amount of premiums for which a deduction was disallowed for
federal purposes because you claimed a federal tax credit for small
employer health insurance premiums.
Specified Research and Experimental Expenses Deduction
(3-digit code: 641)
If you claimed a federal income tax deduction for specified
research and experimental expenses that are required to be
amortized for federal purposes pursuant to IRC section 174,
deduct the amount of expenses paid or incurred in the current
taxable year for federal income tax purposes. See the instructions
for Code 154 for further information on the amount of expenses
required to be added back. Do not claim this deduction for any
research expenses for which a deduction is disallowed under IRC
section 280C(c).
Note. If after printing of this bulletin, IRC Section 174 is amended
to allow immediate expensing of research and experimental
expenses and you elect to amortize those expenses, you cannot
use this code and Code 154 to accelerate the allowance of your
expenses.
Example. Corporation DEF incurred $100,000 of specified
research expenses in 2024. Corporation DEF reported $10,000 of
amortized expenses in 2024. Corporation DEF will use Code 641
to report $100,000 allowable for Indiana purposes and use Code
154 to add back the $10,000 claimed for federal purposes. For
2025-2029, Corporation DEF will continue to use Code 154 to
report timing differences.
Line 2f. Enter the total amount of add-backs and subtractions
from any additional sheets. If more than five modifications are
needed, attach additional sheets detailing them. Total the amounts

from the additional sheets and enter the total here (use a negative
sign to denote a negative amount).
Line 3. Add lines 1 through 2f.

Line 13. Multiply the amount on line 11 by 4.9% (.049).
On line 13, enter the total computed AGI tax based on the taxable
income reported on line 11 of Schedule B.

Line 4. Enter the Indiana apportionment percentage if the
corporation has any multistate business activities. If apportioning
income, enter the Indiana percentage (rounded to two decimal
places) from line 9 of Schedule E, Apportionment of Income
for Indiana. Do not enter 100%. See Schedule E instructions
beginning on page 14.

If the tax exceeds $2,500, enclose the completed Indiana Schedule
IT-2220 to compute any underpayment of estimated tax penalty
or to show an exception to the penalty.

For more information, see Income Tax Information Bulletin #12
available at www.in.gov/dor/files/ib12.pdf.

Sales/Use Tax

Before continuing to lines 5 through 25, complete Schedule IN
K-1 for each shareholder.

Form IT-20S Schedule B – Tax on Excess Net
Passive Income and Built-in Gains

To the extent that the S corporation’s excess net passive income
and built-in capital gains are subject to income tax under the
Internal Revenue Code, the Indiana AGI tax is imposed on such
income of the corporation derived from Indiana sources. Use the
following guidelines to calculate the corporation’s tax liability. The
corporation must make quarterly estimated tax payments if its
Indiana tax liability exceeds $2,500.
All references are from the federal forms. Use updated versions
where applicable.
Line 5. Enter the amount of LIFO recapture income on which you
reported tax on federal Form 1120S, Line 22a, in the first year in
which recapture tax is required to be reported for federal income
tax purposes. Note: Indiana requires the full amount of recaptured
income to be reported in the first year that the recapture is
required for federal tax purposes without regard to the federal
allowance to pay tax over multiple years.
Line 6. Enter the amount of excess net passive income subject to
tax on federal Form 1120S, Line 22a, for the taxable year.
Line 7. Enter the net amount of line 18 from federal Schedule D,
Part III. Use the appropriate lines from the latest federal update.
Enclose Schedule D (1120S) with the return.
Line 9. If the taxable amount on line 8 is not or cannot be wholly
allocated to Indiana, use the apportionment percentage from line
4 to attribute the business income to Indiana. Enclose Schedule
E with the return. Multiply the amount on line 8 by the Indiana
apportionment percentage on line 4. If apportionment of income
is not applicable, enter the total amount from line 9.
Line 10. Enter the amount of net operating losses attributable to
Indiana and allowable for carryforward from a taxable year when the
corporation was a C corporation. Do not enter an amount greater
than Line 7 multiplied by the Indiana apportionment percentage
on Line 4 for the taxable year. If apportionment of income is not
applicable, the amount on this line cannot exceed Line 7.

Summary of Calculations
IC 6-2.5-3-2 imposes a use tax at the rate of 7% on purchases of
tangible personal property. This tax applies to the use, storage, or
consumption of goods in Indiana that were purchased or rented
in a retail transaction, wherever located, and sales tax was not
paid. Examples of taxable items include:
•	 Magazine subscriptions;
•	 Office supplies;
•	 Electronic components; and
•	 Rental equipment.
Any property purchased free of tax using an exemption certificate
or from out-of-state that is converted to a nonexempt use by the
business is subject to the use tax at the time of conversion.
A registered retail merchant for Indiana must report nonexempt
purchases used in the Indiana business. This is reported on Form
ST-103, ST-103MP, or ST-103CAR, Indiana Annual, or Monthly
Sales and Use Tax Voucher. If use tax is not paid by the original
due date of the return, interest will be added to the amount due. A
10% penalty or $5, whichever is greater, is charged on each unpaid
use tax liability.
If Form ST-103, ST103MP, or ST-103CAR is not required or all
taxable purchases have not been properly included on the ST-103
return, multiply the total purchase price of all taxable purchases
by 7%.
If you paid sales or use tax to another state on the purchase,
subtract the sales or use tax paid to the other state or 7% of the
purchase price, whichever is less. Enter the use tax amount on
line 14 of the IT-20S.
Line 15. Enter the total tax liability of the nonresident members
included in the Composite Adjusted Gross Income Tax Return,
column G. Enclose Schedule Composite.
Line 16. Enter the total tax liability from Schedule PTET, Line
24D.
Line 17. Add the tax shown on lines 13, 14, 15, and 16.
Line 18. Enter the total amount of pass-through withholding.
(Enclose a copy of Schedule IN K-1 from the paying entity.)
Do not take any credit for individual or separate estimated tax
payments made by the shareholders.
IT-20S S Corporation Booklet 2024

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Line 19. Enter the total composite withholding payments and
PTET payments from Form IT-6WTH. Amounts for PTET and
amounts withheld from nonresident shareholders included on
Schedule composite are remitted using Form IT-6WTH. Do not
include the amount to be remitted with the filing of this return.
Line 20. Enter any other payments/credits belonging to the
corporation. This may be estimated payments for passive income
and built-in gains tax that was not otherwise passed through to
the shareholders. A detailed explanation must be enclosed for any
credits claimed on this line.
Note. Certain Motorsports Investment District Income (prize
winnings) and IN state and Marion County withholding taxes
may be reported on Form IN-MSID and/or Form IN-MSID-A
and/or Form IN-MSID-A.
If the S corporation allocates any of those prize winnings and
withholding amounts to the ultimate recipients (e.g., shareholder,
individual, etc.), the S corporation must issue form IN-MSID-A
to the recipients to reflect the amounts passed through (winnings
and withholdings). If you did not allocate amounts to other
ultimate recipients, you should issue an IN-MSID-A to yourself
in order to claim the credit for the state and county (if applicable)
withholding amounts.
A detailed explanation must be enclosed for any credits claimed
on this line.
If the corporation reported a liability on line 13 of the IT-20S
and made a contribution eligible for the Indiana College Credit,
check the “Corporation” box Form CC-40, Part I, and include the
amount from Form CC-40, Part III, Line 5 as part of line 18. The
corporation cannot pass the credit through to its shareholders
and cannot use the credit to offset any part of its composite tax or
PTET liability. Please include Form CC-40 with the IT-20S.
Line 21. Enter the amount of Economic Development for a
Growing Economy (EDGE) credit being claimed from line 19 of
Schedule IN-EDGE. Enter only (1) the aggregate credit amounts
from Schedule IN K-1s for the entity’s shareholders who are
included on the composite return and (2) any credit amount that
the corporation is claiming for itself as a refundable credit. The
Schedule IN-EDGE must be completed and enclosed with the
return. Otherwise, this credit will be denied.
Note. If you are electing PTET, report only the amount that is
used to reduce the composite tax due to zero. This reduction must
be determined shareholder by shareholder. Further, the credit
allowable must be determined after PTET reduces composite tax.
Line 22. Enter the amount of EDGE-R credit being claimed
from line 19 of Schedule IN-EDGE-R. Enter only (1) the
aggregate credit amounts from Schedule IN K-1s for the entity’s
shareholders who are included on the composite return and (2)
any credit amount that the corporation is claiming for itself as a
refundable credit. The Schedule IN-EDGE-R must be completed
and enclosed with the return. Otherwise, this credit will be
denied.
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IT-20S S Corporation Booklet 2024

Note. If you are electing PTET, report only the amount that is
used to reduce the composite tax due to zero. This reduction must
be determined shareholder by shareholder. Further, the credit
allowable must be determined after PTET reduces composite tax.
Line 23. Enter the total amount of credits claimed from
Schedule IN-OCC, and enclose Schedule IN-OCC with the
return. Otherwise, these credits will be denied. If filing this
schedule with Form IT-20S, only reflect the credit amounts
from Schedule IN K-1s on behalf of the entity’s shareholders
who are included on the composite return. Do not include
credits from Schedule IN K-1s that belong to shareholders who
are not included on the composite return. Enter the combined
pro rata credits on one line of the IN-OCC; do not enter a line
for each composite member. The total amount of credit for the
members on the composite return cannot exceed the entity’s
total tax due. In addition, sales and use tax cannot be offset by
these nonrefundable credits if included in the total tax due. If an
income tax return is being filed by a shareholder included on the
Schedule Composite, the member should use the 4-digit code
provided on Schedule IN K-1 not the 3-digit code utilized on
the S Corporation income tax return. If you are reporting PTET,
report only the amount used to offset composite tax due. You
cannot use these credits to offset PTET.
Line 24. Subtract lines 18 through 23 from line 17. If a balance
due remains, proceed to lines 25 and 26.
Line 25. Enter the total interest due.
Caution. Two separate calculations of interest and penalty may be
required:
•	 Interest is computed on the net amount of composite tax and
PTET, on line 24, paid after the 15th day of the 4th month
following the end of the corporation’s taxable year. Interest is
calculated from the day following the due date for payment of
the composite tax and PTET to the actual date the balance is
paid with Form IT-20S.
•	 Interest on the use tax and Schedule B tax is calculated on
the remaining amount of tax on line 24 that is paid after the
original due date of Form IT-20S.
For the current rate, see Departmental Notice #3 available at
www.in.gov/dor/files/dn03.pdf.
Line 26. Enter the total penalty due. The penalty for late payment
is 10% of the amount of any tax due on line 24 paid after the
15th day of the 4th month following the end of the corporation’s
taxable year.
However, if composite tax is due as the result of a failure to
withhold on income distributions to nonresident shareholders,
the penalty is 20% of the composite tax not withheld.
If the penalty imposed for late composite tax or failure to
withhold composite tax is less than $5, the penalty imposed is
$5. If the penalty for late payment of use tax and/or Schedule B
tax is less than $5, the penalty imposed is $5. These two penalty
computations are required to be determined separately.

Worksheet for S Corporation Distributive Share Income, Deductions, and Credits
Use this worksheet to compute the entry for line 1 of Form IT-20S and to assist in computing amounts reportable on or for Schedule
IN K-1. Enter the total distributive share of income from each item reportable on Form 1120S, Schedule K. Do not complete column B
and C entry lines unless the corporation received distributive share or tiered income from other entities.
Distributive Share Amounts
S Corporation’s Distributive Share of Items

A.
S Corporation
Income
All Sources

1.	 Ordinary business income (loss)...............................................
2.	 Net rental real estate income (loss)..........................................
3.	 Other net rental income (loss)...................................................
4.	 Interest income..........................................................................
5a.	 Ordinary dividends....................................................................
6.	 Royalties...................................................................................
7.	 Net short-term capital gain (loss)..............................................
8.	 Net long-term capital gain (loss)...............................................
9.	 Net IRC Section 1231 gain (loss)..............................................
10.	 Other income (loss)...................................................................
Less Allowable Deductions for State Tax Purposes
11.	

IRC Section 179 expense deduction...................................

12A.	 Portion of expenses related to investment portfolio income,
including investment interest expense and other (federal
non-itemized) deductions....................................................

B.
Distributions from
Partnerships /
Estates / Trusts

C.
Distributions
Attributed
to Indiana

Enter below for
line 13B total
distributive share
income received
by the corporation
from all non-unitary
partnerships,
estates, and trusts.
Enter for line 14B
an amount equal
to required state
modifications for
Indiana Adjusted
Gross Income.
(See page 7 for
instructions.)

Enter below for
line 13C total
distributive share
income received
by the corporation
from partnerships,
estates and trusts
that were derived
from or allocated to
Indiana. Enter on
line 14C an amount
equal to the Indiana
modifications for
Adjusted Gross
Income attributed to
Indiana.

13B

13C

14B

14C

12B.	 Other information from line 17 of federal K-1 related to
investment interest and expenses not listed elsewhere......
13.	

Carry total on line 13A to Form IT-20S line 1 on front
page of return.....................................................................

14.	

Total of Indiana state modifications to distributive share income
(see line 2f, Form IT-20S).........................................................................................

15.	

Net Indiana adjusted gross income distributions from
partnerships, estates, and trusts (add lines 13C and 14C).........................................................................

15C

16.	

Enter amount of Indiana pass-through credits attributed from
partnerships, estates, and trusts, if any.......................................................................................................

16C

13A

IT-20S S Corporation Booklet 2024

Page 13

If a return showing no liability on line 16 is filed late, the penalty
for failure to file by the due date is $10 per day the return is past
due, up to a maximum of $250. If the tax on line 23 exceeds
$2,500, add any underpayment of estimated tax penalty computed
on Schedule IT-2220 or enclose a completed schedule to show
exception to this penalty. In addition, a separate $10 penalty is
assessed on each Schedule IN K-1 information return that is late.
Note. If you fail to make an estimated payment of PTET, do not
report the penalty on this line. The penalty will be assessed by
DOR separately. No late payment penalty is due on composite
withholding tax if at least 80% of the combined composite
withholding tax and PTET for the current year, or 100% of the
prior year’s withholding tax and PTET, is remitted by the 15th
day of the 4th month following the end of the tax year. Penalty
is applicable if all remaining tax and interest due is not paid by
the extended due date.
Line 27. If line 24 is greater than zero, add lines 24 through 26
and enclose a separate remittance for the total amount owed for
each Form IT-20S filed. Payment to the Indiana Department
of Revenue must be made in U.S. funds and can be made via
INTIME, DOR’s e-services portal at intime.dor.in.gov.
Line 28. If the total of lines 18 through 23 exceeds line 17, subtract
lines 24 through 26 from line 23. If the result is less than zero, this is
the net overpayment.
Note. If penalties and interest are due because of delinquent filing
or payment, the overpayment must be reduced by these charges.
If the result is a balance due, enter the difference on line 27. An S
corporation’s overpayment credit may not be carried over to the
following year; any overpayment amount will be refunded.

Certification of Signatures and
Authorization Section
Sign, date, and print the corporation name on the return. If a paid
preparer completes the return, authorize DOR to discuss the tax
return with the preparer by checking the authorization box above
the line for the name of the personal representative.

Personal Representative Information

Typically, DOR contacts the S corporation if there are any questions
or concerns about the tax return. If DOR can discuss the tax return
with someone else (e.g., the person who prepared it or a designated
person), complete this area.
First, check the “Yes” box that follows the sentence “I authorize
the Department to discuss my tax return with my personal
representative.”
Next, enter:
•	 The name of the individual designated as the corporation’s
personal representative; and
•	 The individual’s email address.
If this area is completed, DOR is authorized to contact the
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IT-20S S Corporation Booklet 2024

personal representative, instead of the corporation, about this tax
return. After the return is filed, DOR will communicate primarily
with the designated personal representative for any matters
concerning this return.
Note. The authorization for DOR to be in contact with your
personal representative can be revoked at any time. To do so,
submit a signed statement to DOR. The statement must include a
name, Federal Identification Number of the S corporation, and the
year of the tax return. Mail the statement to Indiana Department
of Revenue, P.O. Box 7206, Indianapolis, IN 46207-7206.

Officer Information

An officer of the organization must sign and date the tax return and
enter the officer’s name and title. Please provide a daytime telephone
number DOR may call if there are any questions about the tax return.
Also, provide an email address if contact via email is desired.

Paid Preparer Information

Fill out this area if a paid preparer completed this tax return. The
paid preparer must sign and date the return. In addition, please
enter the following:
•	 The paid preparer’s email address;
•	 The name of the firm the paid preparer is employed by;
•	 The paid preparer’s PTIN (personal tax identification number).
This must be the paid preparer’s PTIN; do not enter an FID or
Social Security number;
•	 The paid preparer’s complete address.
Note. Complete this area even if the paid preparer is the same
individual designated as the personal representative.

Mailing Options
If taxes are owed, please mail the completed return to:
Indiana Department of Revenue
P.O. Box 7205
Indianapolis, IN 46207-7205
If taxes are not owed, please mail the completed return to:
Indiana Department of Revenue
P.O. Box 7147
Indianapolis, IN 46207-7147

Instructions for Schedule E,
Apportionment of Income for Indiana
Complete the apportionment of income schedule whenever the
corporation:
•	 Has income derived from sources both within and outside
Indiana; and
•	 Has any nonresident shareholders.
Note. Interstate transportation corporations should consult
Schedule E-7 for details on apportionment of income.
This schedule is available at
www.in.gov/dor/tax-forms/corporate/current-corporatepartnership.

Part I - Apportionment of Adjusted Gross Income
Sales/Receipts. The sales factor is a fraction. The numerator
is the total receipts of the taxpayer in Indiana during the tax
year. The denominator is the total receipts of the taxpayer in all
jurisdictions during the tax year.

In the case of certain receipts, all or a portion of the receipts are
not included.
•	 For receipts includible under IRC section 965 or GILTI
(IRC Section 951A), the amount included as a receipt is
the amount included in adjusted gross income minus any
amount claimed as a foreign source dividend under IC 6-3-212 if the S corporation is itself taxable for federal purposes on
such income.
•	 Receipts do not include deemed foreign dividends under
IRC section 965 or GILTI if the corporation passes through
the deemed foreign dividends or GILTI.
•	 For receipts from the sale of securities, including stocks,
bonds, options, and future and forward contracts, only the
net gain from the sale is treated as a receipt.
•	 For receipts from hedging or similar transactions, only the net
gain resulting from both sets of transactions is treated as a receipt.
The numerator of the receipts factor must include the following to
the extent included in the receipts numerator:
•	 All sales made in Indiana;
•	 All sales made from Indiana to the U.S. government;
•	 All receipts from sales of business property in Indiana; and
•	 All interest, dividend, or other intangible income earned in
Indiana.
The numerator contains intangible income attributed to
Indiana, including interest from consumer and commercial
loans, installment sales contracts, and credit and debit cards as
prescribed under IC 6-3-2-2.2.
Total receipts include gross sales of real and tangible personal
property less returns and allowances. Sales of tangible personal
property are in Indiana if the property is delivered or shipped to
a purchaser within Indiana regardless of the f.o.b. point or other
conditions of sale.
Sales or receipts not specifically attributed above shall be
attributed as follows:
•	 Gross receipts from the sale, rental, or lease of real property
are in Indiana if the real property is located in Indiana;
•	 Gross receipts from the rental, lease, or licensing of the use
of tangible personal property are in Indiana if the property is
in Indiana. If property was both within and outside Indiana
during the tax year, the gross receipts are considered in
Indiana to the extent the property was used in Indiana;
•	 Interest income and other receipts from loans or installment
sales contracts that are primarily secured by or deal with real
or tangible personal property are attributed to Indiana if the
security or sale property is located in Indiana; consumer loans
not secured by real or tangible personal property are attributed
to Indiana if the loan is made to an Indiana resident; and
commercial loans and installment obligations not secured by
real or tangible personal property are attributed to Indiana if
the proceeds of the loan are applied in Indiana.

•	
•	

•	
•	

•	

Interest income, merchant discounts, travel and entertainment
credit card receivables, and credit card holder’s fees are attributed
to the state where the card charges and fees are regularly billed.
Recei