Indiana Form It-40 Instructions
Update: Line 1 of Form IT-40 assumes conformity with the Internal Revenue Code for federal changes adopted after Jan. 1, 2013. If the Indiana state legislature does not conform to the most current changes to the Internal Revenue Code, 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 the department's homepage at www.in.gov/dor/index.htm for updates.
County Tax Changes
- Lake County adopts county tax. Lake County has become the last Indiana county to adopt a county tax. Individuals who live and/or work in Lake County are encouraged to review the county tax instructions beginning on page 52.
- County tax schedule simplified. County tax Schedule CT-40 has been simplified for full-year residents now that all of Indiana's 92 counties have imposed a county tax. See instructions beginning on page 52 for details.
Several add-backs eliminated
The following add-backs have been eliminated retroactive to Jan. 1, 2012:
- IRA charitable distribution add-back
- Motorsports entertainment complex expense
- Qualified advanced mine safety equipment expense
- Qualified leasehold improvement property expense
- Qualified restaurant property expense
- Qualified retail improvement property expense
- Qualified transportation fringe expense
- Tuition and fees deduction
See instructions beginning on page 13 for information on how to update your tax filing if you reported any of these add-backs on your 2012 state tax return.
The following add-backs have been eliminated retroactive to Jan. 1, 2013:
- Educator expense
- Employer-provided educational expenses
- Qualified environmental remediation costs
- Oil and gas well depletion
- Qualified electric utility amortization
- RIC dividends to nonresident aliens
- Start-up expenditures
- Student loan interest
See instructions beginning on page 13 for information on how the elimination of these add-backs might impact your state tax filing.
Automatic taxpayer refund credit
The automatic taxpayer refund credit is not available for the 2013 tax year.
EDGE, EDGE-R credit reporting update
Anyone claiming the economic development for a growing economy (&/or retention) credit must enclose Schedule IN-EDGE or Schedule IN-EDGE-R (retention). See instructions on page 41 for details.
Same-sex marriage tax filing guidelines
In Revenue Ruling 2013-17, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes.
Under Indiana law, same-sex couples are required to file separate individual income tax returns with Indiana. Check the department's webpage at www.in.gov/dor/4895.htm for guidance on how to properly file with Indiana.
School scholarship credit reporting change
Beginning with tax year 2013, any unused school scholarship credit may be carried forward to subsequent tax years. See instructions on page 50 for more information.
Voluntary remediation credit
This credit is no longer available. Tax year 2007 was the last year to claim a new voluntary remediation credit; 2012 was the last year to which any previously unused credit was allowed to be carried.
Need Tax Forms or Information Bulletins?
Use your personal computer - Visit our website and download the forms you need. Our address is www.in.gov/dor .
Use your telephone - Call the forms order request line (317) 615-2581 to have forms mailed to you. Have the following information ready to leave on the voice mail system:
- Name of form or form number needed
- Number of copies needed
- Contact person's name
- Daytime phone number
- A complete mailing address (including city, state and zip code)
Visit a district office, library or post office - Tax forms are available at district offices located throughout the state. These offices are open Monday - Friday, 8 a.m. to 4:30 p.m. Visit www.in.gov/dor/3390.htm for a list of these offices, including addresses and telephone numbers. Also, contact your library or post office to find out if they stock any state tax forms.
Need Help With Your Return?
Local help - You may be eligible to take advantage of the IRS Volunteer Return Preparation Program (VRPP). This program offers free tax return help to low income, elderly and special needs individuals. Volunteers will fill out federal and state forms for those who qualify. Call the IRS at 1-800-829-1040 to find the nearest VRPP location. Be sure to take your W-2s, 1099s and a copy of last year's state and federal tax returns.
Automated information line - Call the automated information line at (317) 233-4018 to get the status of your refund, billing and payment plan information, a copy of your tax return, or prerecorded tax topics. If you wish to check for billing information, be sure to have a copy of your tax notice. The system will ask you to enter the tax identification number shown on the notice.
If you have a rotary phone, please call (317) 232-2240, 8 a.m. to 4:30 p.m., Monday - Friday, and a representative will help you.
Internet address - If you need help deciding which form to file, or need to get information bulletins or policy directives on specific topics, visit our website at www.in.gov/dor .
Telephone - Call us at (317) 232-2240 Monday - Friday, 8 a.m. to 4:30 p.m., for help with basic tax questions.
Ready To File Your Return?
Use an electronic filing program
More than 2.5 million Hoosier taxpayers used an electronic filing program to file their 2012 state and federal individual income tax returns. Electronic filing provides Indiana taxpayers the opportunity to file their federal and state tax returns immediately, and receive their Indiana refunds in about half the time it takes to process a paper return. It takes even less time if you use direct deposit, which deposits your refund directly into your bank account. Even if there is an amount due on either return, Indiana taxpayers can still file electronically and feel comfortable knowing that the returns were received by the IRS and the Indiana Department of Revenue. Contact your tax preparer to see if he or she provides this service.
This tax season Indiana continues to offer a free tax filing service through the cooperation of the Free File Alliance.
Eligible Indiana taxpayers can file both the federal and Indiana individual tax returns using highly interactive and easy-to-use web-based applications that speed both returns and refunds. Some services also offer state-only filings as well.
Approximately twenty-four states will be using the Free File option in 2014. And, you have the selection of multiple vendors to use for this free service. The Department of Revenue estimates that nearly 1 million Indiana taxpayers will be eligible for this free service. You may be one. In fact, more than 119,000 Hoosier taxpayers used INfreefile last year and expressed a very high satisfaction rate with the service.
Take a look at this new service by visiting www.freefile.dor.in.gov . See if you are eligible to participate.
Our website offers tax filing options, a Spanish version of the IT-40 booklet with forms, downloadable blank forms and instructions, information bulletins, commissioner's directives, an online helpdesk, helpful email links and a calendar with filing due dates. Visit the department's website at www.in.gov/dor .
Where's your refund?
There are several ways to check the status of your refund. You will need to know the exact amount of your refund, and a Social Security number entered on your tax return. Then, do one of the following: Go to www.in.gov/dor/4339.htm and click Check the Status of Your Refund.
- Call (317) 233-4018 for automated refund information.
- Call (317) 232-2240 from 8 a.m. to 4:30 p.m. Monday - Friday, and a representative will help you.
A refund directly deposited to your bank account may be listed on your bank statement as a credit, deposit, etc. If you have received information from the department that your refund has been issued, and you are not sure if it has been deposited in your bank account, call the ACH Section of your bank or financial institution for clarification.
Important. If we are unable to deposit your refund to the listed account (incorrect/incomplete account numbers; account closed; refund to go to an account outside the United States; etc.), the department will mail a paper check to the address on the front of the tax form.
Note. A refund deposited directly to your Hoosier MasterCard account will appear on your monthly statement.
You need to notify the department if you move to a new address after filing your tax return, and you do not have a forwarding address on file with the post office.
Change your address with us by doing one of the following:
- Go to https://secure.in.gov/dor/4706.htm and change your address online.
- Call the department at (317) 232-2240.
Filing an amended (corrected) tax return
Did you receive a lateW-2 or other kind of income statement after you filed? Did you forget to claim an exemption or deduction? If you need to amend (correct) a tax return that has already been filed, use Form IT-40X, Amended Individual Income Tax Return, located at www.in.gov/dor/4878.htm .
Public Hearing - June 3, 2014
The department will hold a public hearing on June 3, 2014. The hearing will be held at 9 a.m. in Conference Room 1 of the Conference Center, Indiana Government Center South, 402 West Washington Street, Indianapolis, Ind. You may also submit your questions or comments in writing to: Indiana Department of Revenue, Commissioner's Office, MS# 101, 100 North Senate Avenue, Indianapolis, IN, 46204.
Before You Begin
Important. You must complete your federal tax return first.
Filling in the boxes - please use ink only. If you are filling out the form by hand, please use black or blue ink and print your letters and numbers neatly. If you do not have an entry for a particular line, leave it blank. Do not use dashes, zeros or other symbols to indicate that you have no entry for that line.
Social Security Number. Be sure to enter your Social Security number in the boxes at the top of the form. If filing a joint return, enter your Social Security number in the first set of boxes and your spouse's Social Security number in the second set of boxes. An incorrect or missing Social Security number can increase your tax due, reduce your refund or delay timely processing of your filing.
Individual Taxpayer Identification Number (ITIN). If you already have an ITIN, enter it wherever your Social Security number is requested on your tax return. If you are in the process of applying for an ITIN, check the box located directly beneath the Social Security number area at the top of the form. For information on how to get an ITIN, contact the IRS at 1-800-829-3676 and request federal Form W-7, or find it online at www.irs.gov .
Name and suffix. Please use all capital letters when entering your information. For example, Jim Smith Junior should be entered as JIM SMITH JR.
Name. If your last name includes an apostrophe, do not use it. For example, enter O'Shea as OSHEA. If your name includes a hyphen, use it. For example, enter SMITH-JONES.
Suffix. Enter the suffix associated with your name in the appropriate box.
- Use JR for junior and SR for senior.
- Numeric characters must be replaced by alphabetic Roman Numerals. For example, if your last name is Charles 3rd, do not use 3rd; instead, enter III in the suffix field.
- Do not enter any titles or designations, such as M.D., Ph. D., RET., Minor or DEC'D.
Married filing requirements
- Same-sex marriage tax filing guidelines. In Revenue Ruling 2013-17, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes.
Under Indiana law, same-sex couples are required to file separate individual income tax returns with Indiana. Check the department's webpage at www.in.gov/dor/4895.htm for guidance on how to properly file with Indiana.
- Married filing jointly. If you filed your federal income tax return as married filing jointly, you also must file married filing jointly with Indiana (if you filed your federal income tax return as a same-sex married couple, visit www.in.gov/ dor/4895.htm for guidance on how to properly file with Indiana).
- Married filing separately. If you file your federal income tax return as married, filing separately, you must also file married, filing separately with Indiana (if you filed your federal income tax return as a same-sex married couple, visit www.in.gov/dor/4895.htm for guidance on how to properly file with Indiana). Enter both of your Social Security numbers in the boxes on the top of the form, and then check the box directly to the right of those boxes. Enter the name of the person filing the return on the top line, but do not enter the spouse's name on the second name line.
- Married persons who live apart filing status. If you were not divorced or legally separated in 2013 you may have qualified for and filed as 'head of household' on your federal income tax return. If you did, do not check the married filing separately box. Also, do not enter either your spouse's name or Social Security number.
Military address. Overseas military addresses must contain the APO, FPO designation in the "city field" along with a two-character "state" abbreviation of AE, AP, or AA and the zip code. Place these two- and three-letter designations in the city name area.
Zip/Postal code. Enter your five or nine digit zip code (do not use a dash). For example, enter 46217 or 462174540.
If filing with a foreign address, enter the associated postal code.
Foreign country code. Complete this area if the address you are using is located in a foreign country. Enter the 2-character foreign country code, which may be found online at www.in.gov/dor/4432.htm .
School corporation number. Enter the four-digit school corporation number (found on pages 55 and 56) for where the primary taxpayer lived on Jan. 1, 2013. The primary taxpayer is the first name listed at the top of the tax return. If the primary taxpayer did not live in Indiana on Jan. 1, 2013, enter the code number "9999". Contact a local school or your county auditor's office if you're not sure which school corporation you live in.
It is important that you enter the correct school corporation number. This information is used for statistical tracking purposes to determine possible school funding needs and changes.
Note. If the school corporation number is not entered, the processing of your return will be delayed.
County information. Enter the two-digit code numbers for the county(s) where you and your spouse, if filing joint, lived and worked on Jan. 1, 2013. You can find these code numbers on the chart found on the back of the Schedule CT-40. See the instructions beginning on page 52 for more information, including the definitions of the county where you live and work, details for military personnel, retired individuals, homemakers, unemployed individuals, out-of-state filers, etc.
Refund check address. Your refund check will be issued in the name(s), address and Social Security number(s) shown on your tax return. It is very important that this information is correct and legible. Any wrong information will delay your refund.
Rounding required. Each line on which an amount can be entered has ".00" already filled- in. This is to remind you that rounding is required when completing your tax return.
You must round your amounts to the nearest whole dollar.
To do this, drop amounts of less than $0.50. Example. $432.49 rounds down to $432.00.
Increase amounts of $0.50 or more to the next higher dollar. Example. $432.50 rounds up to $433.00.
Losses or negative entries. When reporting a loss or negative entry, use a negative sign. Example. Write a $125 loss as -125.
Commas. Do not use commas when entering amounts. For instance, express 1,000 as 1000.
Enclosing schedules, W-2s, etc. You will find an enclosure sequence number in the upper right-hand corner of each schedule. Make sure to put your completed schedules in sequential order behind the IT-40 when assembling your tax return. Do not staple or paper clip your enclosures. If you have a schedule on which you've made no entry, do not enclose it unless you have completed information on the back of it.
- All W-2s and 1099s on which Indiana state and/or county tax withholding amounts appear,
- Any 1099G showing unemployment compensation,
- A check/money order, if applicable.
A note about your W-2s. It is important that your W-2 form is readable. The income and state and county tax amounts withheld are verified on every W-2 form that comes in with your tax return. We encourage you to enclose the best copy available when you file.
Who Should File?
You may need to file an Indiana income tax return if:
- You lived in Indiana and received income, or
- You lived outside Indiana and had any income from Indiana.
Note. If you and your spouse file a joint federal tax return, you must file a joint tax return with Indiana. If you and your spouse file separate federal tax returns, you must file separate tax returns with Indiana.*
*Exception. In Revenue Ruling 2013-17, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. Under Indiana law, same-sex couples are required to file separate individual income tax returns with Indiana. Check the Department's webpage at www.in.gov/dor/4895.htm for guidance on how to properly file with Indiana.
There are four types of Indiana tax returns available. The type you need to file is generally based on your residency status. Read the following to decide if you are a full-year resident, part-year resident, or nonresident of Indiana, and which type of return you should file.
If you were a full-year resident of Indiana and your gross income (the total of all your income before deductions) was greater than your total exemptions, you must file an Indiana tax return.
Full-year residents must file Form IT-40, Indiana Full-Year Resident Individual Income Tax Return or Form IT-40EZ for Full-Year Indiana Resident Filers with No Dependents. If you filed a 2013 federal Form 1040EZ, were a full-year resident of Indiana, claim only the renter's deduction and/or unemployment compensation deduction, and have only Indiana state and county tax withholding credits, then you should file the simplified Form IT-40EZ. If you are not eligible to file Form IT-40EZ, have any add-backs or other deductions or credits, you must file Form IT-40.
You are a full-year Indiana resident if you maintain your legal residence in Indiana from Jan. 1 - Dec. 31 of the tax year. You do not have to be physically present in Indiana the entire year to be considered a full-year resident. Residents, including military personnel, who leave Indiana for a temporary stay, are considered residents during their absence.
Retired persons spending the winter months in another state may still be full-year residents if:
- They maintain their legal residence in Indiana and intend to return to Indiana during part of the taxable year,
- They retain their Indiana driver's license,
- They retain their Indiana voting rights, and/or
- They claim a homestead deduction on their Indiana home for property tax purposes.
Indiana allows $1,000 for each exemption claimed on your federal return, plus an additional $1,500 for certain dependent children (see instructions on page 26 for more information). If you did not have to file a federal return, you should complete a "sample" federal return to see how many exemptions you are eligible to claim.
If your gross income is less than your total exemptions, you are not required to file. However, you may want to file a return to get a refund of any state and/or county tax withheld by your employer, or other refundable credits, such as an earned income credit.
Part-year residents and full-year nonresidents
If you were a part-year resident and received income while you lived in Indiana, you must file Indiana Form IT-40PNR, Part-Year Resident or Nonresident Individual Income Tax Return.
If you were a legal resident of another state (exception: see next paragraph) and had income from Indiana (except certain interest, dividends, or retirement income), you must file Form IT-40PNR.
Full-year residents of Kentucky, Michigan, Ohio, Pennsylvania or Wisconsin
If you were a full-year resident of Kentucky, Michigan, Ohio, Pennsylvania or Wisconsin, and your only income from Indiana was from wages, salaries, tips or commissions, then you need to file Form IT-40RNR, Indiana Reciprocal Nonresident Individual Income Tax Return.
If an individual died during 2013, or died after Dec. 31, 2013, but before filing his/her tax return, the executor, administrator or surviving spouse must file a tax return for the individual if:
- The deceased was under the age of 65 and had gross income over $1,000
- The deceased was age 65 or older and had gross income over $2,000, or
- The deceased was a nonresident and had gross income from Indiana.
Be sure to enter the month and day of death for the taxpayer or spouse in the appropriate box located on Schedule 7. For example, a date of death of Jan. 9, 2013, would be entered as 01/09/2013. Note. The date of death should not be entered here if the individual died after Dec. 31, 2013, but before filing the tax return. The date of death information will be shown on the individual's 2014 tax return.
Signing the deceased individual's tax return
If a joint return is filed by the surviving spouse, the surviving spouse should sign his or her own name and after the signature write: "Filing as Surviving Spouse."
An executor or administrator appointed to the deceased's estate must file and sign the return (even if this isn't the final return), indicating their relationship after their signature (e.g. administrator).
If there is no executor, or if an administrator has not been appointed, the person filing the return should sign and give their relationship to the deceased (e.g. "John Doe, nephew"). Only one tax return should be filed on behalf of the deceased.
Note. The department may ask for a copy of the death certificate, so please keep a copy with your records.
A refund check for a deceased individual
If you (the surviving spouse, administrator, executor or other) have received a refund check and cannot cash it, contact the department to get a widow's affidavit (POA-30) or a distributee's affidavit (POA-20) at www.in.gov/dor/3508.htm . Send the completed affidavit, the refund check and a copy of the death certificate to the State Auditor's Office so a refund check can be issued to you.
Military personnel - residency
If you were an Indiana resident when you enlisted, you remain an Indiana resident no matter where you are stationed. You must report all your income to Indiana on Form IT-40.
If you changed your legal residence (military home of record) during 2013, you are a part-year resident and should file Form IT-40PNR. You must also enclose a copy of Military Form DD-2058 with the tax return. As an Indiana part-year resident you will be taxed on the income you earned while you were a resident of Indiana, plus any income from Indiana sources.
If you are stationed in Indiana and you are a resident of another state, you won't need to file with Indiana unless you have non-military income from Indiana sources.
Example. Annie, who is a Kansas resident, is stationed in Indiana. She earned $1,300 from her Indiana part-time job. She'll need to report that income to Indiana on Form IT-40PNR.
If you are a full-year Indiana resident in the military, your spouse is a legal resident of another state and you filed a joint federal return, you will need to file Form IT-40PNR.
Important. Refer to the instructions on page 53 for an explanation of county of residence for military personnel.
When Should You File?
Your tax return is due April 15, 2014. If you file after this date, you may have to pay interest and/or penalty. See page 12 for more information.
Fiscal year tax returns are due by the fifteenth (15) day of the fourth (4th) month after the close of the fiscal year. You must complete the fiscal year filing period information at the top of the form.
Extension of time to file - What if you can't file on time?
You must get an extension of time to file if you:
- Are required to file (your income is more than your exemptions), and
- You cannot file your tax return by the April 15, 2014 due date.
Whether you owe additional tax, are due a refund or are breaking even, you still need to get an extension if filing after April 15, 2014.
If you owe...
Option 1. File Indiana's 60 day extension of time to file, Form IT-9, and send in a payment of at least 90 percent of the tax you expect to owe. This must be filed and tax paid by April 15, 2014 for the extension to be valid. Then, make sure to file your tax return by June 16, 2014, paying any balance due with that filing. While interest will be due with the final payment, penalty will be waived.
Option 2. If you have filed for a 6 month federal extension of time to file (Form 4868) with the IRS, you are not also required to file for a state extension (via Form IT-9). Make sure to file your tax return by Nov. 17, 2014 (Indiana allows for an additional 30 days), paying any balance due with that filing. While interest will be due with the final payment, penalty may be waived if at least 90 percent of the tax you expected to owe was paid by the April 15, 2014 original filing due date.
If you don't owe...
You'll need to file for an extension if:
- You are due a refund, or
- You don't expect to owe any tax when filing your tax return, and
- You are unable to file your return by April 15, 2014.
There are two ways to accomplish this:
- If you have a valid federal extension, Form 4868, you automatically have an extension with Indiana and do not have to file for a separate state extension (Form IT-9).
- If you do not have a valid federal extension, file Form IT-9 by April 15, 2014.
Extension filing deadline.
- State Form IT-9 extends your state filing time to June 16, 2014.
- Federal Form 4868 extends your state filing time to Nov. 17, 2014.
- If you have both extensions (state and federal), the extended state filing time to file is Nov. 17, 2014.
Will you owe penalty and/or interest?
Interest is owed on all amounts paid after April 15, 2014. See page 12 for instructions on how to figure interest.
Penalty will not be owed if you have:
- By April 15, 2014, paid 90 percent of the tax you expect to owe,
- Filed your tax return within the extension filing time, and
- Pay any remaining amount due with that filing.
Indiana's Extension of Time to File, Form IT-9. Get Indiana's extension Form IT-9, and mail it (including any payment due) by April 15, 2014. You may get Form IT-9 online at www.in.gov/dor/4878.htm . You may also file for an extension (if making a payment) online at www.in.gov/dor/4340.htm (make sure to do this by April 15, 2014).
Where to report your extension payment.
Add your state extension payment to any estimated tax paid. Report the total on Schedule 5, line 3.
Remember, 90 percent of the tax due to Indiana must still be paid by April 15, 2014. Interest will be due on any tax that remains unpaid during the extension period.
Military personnel on duty outside of the United States and Puerto Rico on the filing due date are allowed an automatic 60 day extension of time to file. A statement must be enclosed with the return verifying that you were outside of the United States or Puerto Rico on April 15, 2014.
Military personnel in a presidentially declared combat zone have an automatic extension of 180 days after they leave the combat zone. In addition, if they are hospitalized outside the United States because of such service, the 180-day extension period begins after being released from the hospital. The spouse of such service member must use the same method of filing for both federal and Indiana (e.g. single or joint). When filing the return, write "Combat Zone" across the top of the form (above your Social Security number).
Note. Valid extensions are only for filing purposes. Interest will be due on any tax that remains unpaid during the extension period.
Form IT-40: Line-by-line instructions
Important. You must complete your federal income tax return (Form 1040, 1040A or 1040EZ) before starting your Indiana income tax return. Line numbers from your federal income tax return are referenced in many of the following instructions. While every effort has been made to make the instructions as clear as possible, sometimes the line numbers change on the federal income tax return after the Indiana forms are finalized. Please contact us if you are unsure as to whether or not you are looking at the correct line on your federal income tax return (see page 4 of this booklet for contact information).
When not to fill in a line. If you do not have an entry for a particular line, leave it blank. Do not use dashes, zeros or other symbols to indicate that you have no entry for that line.
Line 1 - Federal adjusted gross income
Enter the adjusted gross income from your federal Form 1040 (line 37), 1040A (line 21), or 1040EZ (line 4). If you were not required to file a federal return, complete a "sample" federal return and report the amount you would have shown on your federal return if you had been required to file.
Important. In Revenue Ruling 2013-17, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. Under Indiana law, same-sex couples are required to file separate individual income tax returns with Indiana. Check the department's webpage at www.in.gov/dor/4895.htm for guidance on how to properly file with Indiana.
When reporting a loss or negative entry, use a negative sign. Example. Write a $125 loss as -125.
Line 2 - Add-backs
Enter on this line any add-backs from Schedule 1: Add-Backs. Instructions for Schedule 1 begin on page 13. Make sure to enclose Schedule 1 when filing.
Line 4 - Deductions
Enter on this line any deductions from Schedule 2: Deductions. Instructions for Schedule 2 begin on page 19. Make sure to enclose Schedule 2 when filing.
Line 6 - Exemptions
Enter any exemptions from Schedule 3: Exemptions on this line. Instructions for Schedule 3 begin on page 26. Make sure to enclose Schedule 3 when filing.
Line 9 - County tax
Complete Schedule CT-40 to figure your county tax. Instructions for Schedule CT-40 begin on page 52.
Line 10 - Other taxes
Enter any other taxes from Schedule 4: Other Taxes on this line. Instructions for Schedule 4 begin on page 27. Make sure to enclose Schedule 4 when filing.
Line 12 - Credits
Enter your credits from Schedule 5: Credits on this line. Instructions for Schedule 5 begin on page 28. Make sure to enclose Schedule 5 when filing.
Line 13 - Offset credits
Enter the total of any offset credits reported on Schedule 6: Offset Credits on this line. Instructions for Schedule 6 begin on page 41. Make sure to enclose Schedule 6 when filing.
Line 17 - Contribution to Indiana Nongame Wildlife Fund
The Indiana Wildlife Diversity Section offers you the opportunity to play an active role in conserving Indiana's nongame and endangered wildlife. This program is funded through public donations to Indiana's Nongame Fund. The money you donate goes directly to the protection and management of more than 750 wildlife species in Indiana - from songbirds and salamanders to state-endangered Trumpeter swans and spotted turtles.
Enter the amount of your refund you wish to donate to the Nongame Wildlife Fund on line 17. You can donate all or a part of your refund. Donations must be a minimum of $1. If you are not receiving a refund, but want to support the Wildlife Diversity Section, do not change your tax return. You can send a donation directly to the Nongame Fund by completing the form on the back of this booklet.
Read more about Indiana's Wildlife Diversity Section and learn how donations have helped Indiana's endangered wildlife at www.in.gov/dnr/fishwild/3316.htm .
Note. The department may examine your return and find that your actual overpayment or refund is less than you calculated. If you entered a donation to the Indiana Nongame Wildlife Fund and wish to apply some of your overpayment to your 2014 estimated tax account, the overpayment will be applied first to the wildlife fund and then to the estimated tax account. Any amount left will be refunded to you.
Line 19 - Amount to be applied as a 2014 estimated tax installment payment
You should pay estimated tax if you expect to have income during the 2014 tax year that:
- Will not have Indiana income taxes withheld, or
- If you think the amount withheld will not be enough to pay your tax liability, and
- You expect to owe more than $1,000 when you file your tax return.
There are several ways you can make estimated tax payments. First, visit our website at www.in.gov/dor/4878.htm to get Form ES-40. Use the worksheet on Form ES-40 to see how much you will owe. Then, if you have an overpayment showing on line 18 of your tax return, you can have some or all of the overpayment applied to next year's estimated tax account. To do so, enter any portion of the overpayment:
- On line a, if you want to apply an amount to offset estimated county tax due (from Form ES-40 worksheet, line K). Also, enter the 2-digit county code from line K; and/or
- On line b, if your spouse lived in a different county than you did on Jan. 1, 2014, and you want to apply an amount to offset your spouse's estimated county tax due (from Form ES-40 worksheet, line L). Also, enter the 2-digit county code from line L; and/or
- On line c, if you want to apply an amount to offset your estimated state tax due (from Form ES-40 worksheet, line J).
Example. Mark and Megan have a $420 overpayment, and want to apply some of it to their 2014 estimated tax account. Their worksheet from Form ES-40 has the following breakdown:
- Line I (each installment payment) is $300;
- Line J (portion that represents state tax due) is $270; and
- Line K (portion that represents county tax due) is $30.
They will enter $30 on line 19a (along with their 2-digit county code), $270 on line 19c, and the $300 total amount to be applied will be entered on line 19d. They will get a $120 refund ($420 overpayment minus $300 applied to their 2014 estimated tax account).
Example. Stu wants to pay $500 in estimated tax for each installment period. He has a $30 overpayment on his tax return. He chooses to enter the full $30 overpayment on line 19c (Indiana adjusted gross income tax amount), and carries it to line 19d. (He will pay the $470 additional amount by filing the Form ES-40.)
Important. Estimated tax installment payments made for the 2014 tax year are due by April 15, 2014, June 16, 2014, Sept. 15, 2014 and Jan. 15, 2015. Any installment payment amount entered on line 19d will be considered to be paid on the day your tax return is filed (postmarked). For instance, an installment payment shown on a return filed on: April 15, 2014, will be considered to be a 2014 first installment payment; June 3, 2014, will be considered to be a 2014 second installment payment; and July 22, 2014, will be considered to be a 2014 third installment payment.
Note. If you are filing this return after Jan. 15, 2015, you will not be able to make an installment payment on this line.
Note. You may use Form ES-40 to make a payment by check or money order. Estimated tax payments may also be made online, via credit card or check, at www.in.gov/dor/4340.htm . See line 26 instructions on page 12 for details about payment options.
See Income Tax Information Bulletin #3 at www.in.gov/dor/3650.htm for additional information about estimated taxes.
Line 20 - Penalty for underpayment of estimated tax
You might owe a penalty for the underpayment of estimated tax if you did not have taxes withheld from your income and/or you did not pay enough estimated tax throughout the year.
In fact, not properly paying estimated tax is one of the most common errors made in filing Indiana tax returns. Generally, if you owe $1,000 or more in state and county tax for the year that's not covered by withholding taxes, you need to be making estimated tax payments.
You might owe this penalty if:
- The total of your credits, including timely estimated tax payments, is less than 90 percent of this year's tax due or 100 percent* of last year's tax due, ** or
- You underpaid the minimum amount due for one or more of the installment periods.
If either of these cases apply to you, you must complete Schedule IT2210 or IT-2210A to see if you owe a penalty or if you meet an exception. If you owe this penalty, enclose Schedule IT-2210 or IT-2210A with your tax return and write the penalty amount on Form IT-40, line 20.
*You must have timely paid 100 percent of lines 8 and 9 of your 2012 IT-40 or IT-40PNR. Note: If last year's Indiana adjusted gross income was more than $150,000 ($75,000 for married filing separately), you must pay 110 percent of last year's tax (instead of 100%).
**Farmers and fishermen should see the special instructions in the next column.
Important. The department will automatically figure a penalty for you if it looks like you owe a penalty for the underpayment of estimated tax, and:
- You didn't report a penalty amount on line 20, and
- You didn't enclose Schedule IT-2210 or Schedule IT-2210A showing you meet an exception to owing a penalty.
Should you use Schedule IT-2210 or IT-2210A?
Schedule IT-2210 should be used by individuals who receive income (not subject to withholding tax) on a fairly even basis throughout the year. This schedule will help determine whether a penalty is due, or whether an exception to the penalty has been met.
Example. Jim and Sarah together received $4,500 in pension income each month. Since their income is received on a fairly even basis, they'll use Schedule IT-2210 to figure their penalty or exception to the penalty.
Farmers and fishermen have special filing considerations. If at least two-thirds (2/3) of your gross income is from farming or fishing, Complete Schedule IT-2210, using the Section D Short Method.
Schedule IT-2210A should be used by individuals who receive income (not subject to withholding tax) unevenly during the year. This schedule will help determine whether a penalty is due, or whether an exception to the penalty has been met.
Example. Bill's income is from selling fireworks in June and July. He will want to figure any penalty due on Schedule IT-2210A, which may exempt him from having had to pay estimated tax on the April 15, 2013 first installment due date.
Example. Rachael received a sizeable lump sum distribution in Dec. of 2013. She figured how much estimated tax was due, and paid it by the Jan. 15, 2014, fourth period installment due date. By completing Schedule IT-2210A, she shows she owes no penalty for the first three installment periods, and that a proper payment was made for the fourth installment period. She will owe no penalty.
Farmers and Fishermen. Special options are available if more than two-thirds of your gross income for 2012 and/or 2013 was from farming or fishing.
Option 1. Pay your estimated tax in one payment on or before Jan. 15, 2014, and file your tax return by April 15, 2014; or
Option 2. Make no estimated tax payment and file your tax return and pay all the tax due by March 3, 2014.
Example. More than two-thirds of Henry's gross income is from farming. He should complete Schedule IT-2210 (not Schedule IT-2210A). He will be able to use the Section D Short Method to figure his penalty or to show he meets an exception to owing a penalty.
Visit our website at www.in.gov/dor/4878.htm to get Schedule IT-2210 or IT-2210A.
Line 21 - Refund
You have a refund if line 18 is greater than the combined amounts entered on lines 19d and 20.
Important. If the combination of line 19d plus line 20 is greater than the amount on line 18, you must make an adjustment. The estimated tax carryover amount on line 19d is limited; it cannot be greater than the remainder of line 18 minus line 20. See the second example about Stu under the Line 19 instructions on page 10.
Please wait 12 weeks before you contact the department about your refund.
A note about refund offsets
Indiana law requires that money you owe to the state, its agencies and certain federal agencies be deducted from your refund or credit before a refund is issued. This includes money owed for past-due taxes, student loans, child support, food stamps or an IRS levy. If the department applies your refund to any of these debts, you will receive a letter explaining the situation.
Note. There is a statute of limitations when filing for a refund. When filing your 2013 tax return, a claim for refund of excess withholding credits must be made no later than April 18, 2016. A claim for refund of all other excess payments and refundable credits must be made by April 18, 2017. (The claim is considered to be made on the day your tax return is postmarked.) If you file your 2013 tax return after the statute of limitations has expired, no refund will be issued.
Line 22 - Direct deposit
You may choose to have your refund deposited in your checking, savings or Hoosier Works Master Card account. If you want your refund directed into your checking or savings account, complete lines 22 a, b, c and d.
Caution. If you choose this option, make sure to verify the account information after you've entered it. This will help ensure your refund is deposited into your desired account.
The routing number is nine digits, with the first two digits of the number beginning with 01 through 12 or 21 through 32. Do not use a deposit slip to verify the number because it may have internal codes as part of the actual routing number.
The account number can be up to 17 digits. Omit any hyphens, accents and special symbols. Enter the number from left to right and leave any unused boxes blank.
Check the appropriate box for the type of account you are making your deposit to: either a checking account or savings account.
To comply with banking rules, you must place an X in the box on line d if your refund is going to an account outside the United States. If you check the box, we will mail you a paper check.
If you currently have a Hoosier Works MasterCard and wish to have your refund directly deposited in your account, enter your 12-digit account number on line 22b, where it says "Account Number" (do not write anything on line 22a "Routing Number"). You can find your 12-digit account number in the upper right-hand corner of your account monthly statement.
Note. DO NOT use your MasterCard 16-digit number.
Make sure to check the "Hoosier Works MC" box on line 22c.
For more information on direct deposit, please see "Where's Your Refund?" on page 5.
If line 21 is less than zero, you have an amount due. Enter here as a positive number and skip to line 24.
If line 15 is greater than line 14, complete the following steps:
Subtract line 14 from line 15 and enter the total here _____
Enter any amount from line 20 _____
Add lines A + B. Enter total here and on line 23 _____
Line 24 - Penalty
You may owe a penalty if your tax return is filed after the April 15, 2014, due date and you have an amount due. Penalty is 10 percent (.10) of the amount due (line 23 minus line 20) or $5, whichever is greater. Exception: No penalty will be due if you have:
- An extension of time to file;
- Are filing and paying the remaining tax due by the extended filing due date and
- Have prepaid at least 90 percent of the amount due by April 15, 2014.
Line 25 - Interest
You will owe interest (even if you have a valid extension of time to file) if your tax return is filed after the April 15, 2014 due date and you have an amount due. Interest should be figured on the sum of line 23 minus line 20. Contact the department at (317) 232-2240 or visit our website at www.in.gov/dor/3618.htm to get Departmental Notice #3 for the current interest rate.
Line 26 - Amount due - payment options
There are several ways to pay the amount you owe.
Make your check, money order or cashier's check payable to: Indiana Department of Revenue. Just include the payment loose in the envelope. Do not staple it to the return. Do not send cash.
You may also pay using the electronic eCheck payment method. This service uses a paperless check and may be used to pay the tax due with your Indiana individual income tax return, as well as any billings issued by the Indiana Department of Revenue for any tax type. To pay, go to www.in.gov/dor/4340.htm and follow the step-by-step instructions. You will receive a confirmation number and should keep this with your tax filing records. The fee for using this service is $1.
Note. All payments made to the Indiana Department of Revenue must be made with U.S. funds.
You may also pay by using your American Express® Card, Discover® Card, MasterCard® or VISA® by calling 1-800- 2-PAY TAX (1-800-2729829). Or, log on to www.in.gov/dor/4340.htm and use your Discover® Card, MasterCard® or VISA® to make a payment.
A convenience fee will be charged by the credit card processor based on the amount you are paying. You will be told what the fee is and you will have the option to either cancel or continue the credit card transaction.
Payment plan option. If you cannot pay the full amount due at the time you file, you may be eligible to set up a payment plan online. After you get a tax bill, log on to www.intaxpay.in.gov and select the Individual Eligibility tab.
Important. If using the payment plan option, penalty and interest will be due on all amounts paid after the April 15, 2014 due date.
Returned checks and other types of payments
If you make a tax payment with a check, credit card, debit card or electronic funds transfer, and the department is unable to obtain payment for its full amount when it is presented for payment, a 10 percent penalty of the unpaid tax or the face value of the check, credit card, debit card, or electronic funds transfer, whichever is smaller, is due.
The assessed amount will be due immediately upon receipt of the tax due notice and must be paid by certified check, bank draft or money order. If payment is not received within 10 days after the notice was mailed, the penalty is increased to 30 percent multiplied by the value of the check, credit card, debit card, or electronic funds transfer, or the unpaid tax, whichever is smaller. Also, any permits and/or licenses issued by the department may be revoked if the assessed amount is not paid immediately.
Signatures and signing dates
First, read the Authorization area on Schedule 7. Then, sign and date the tax return. If this is a jointly filed tax return, both you and your spouse must sign and date it. Make sure to enclose the completed Schedule 7 when filing.
As prescribed by the Taxpayer Bill of Rights, the department has an appointed Taxpayer Advocate whose purpose is to facilitate the resolution of taxpayer complaints and complex tax issues. If you have a complex tax issue, you must first pursue resolution through normal channels, such as contacting the tax administration division (317-2322240). If you are still unable to resolve your tax issue, or a tax assessment places an undue hardship on you, you may receive assistance from the Office of the Taxpayer Advocate.
For more information, and to get required schedules if filing for an offer in compromise or a hardship case, visit our website at: www.in.gov/dor/3883.htm . You may also contact the Office of the Taxpayer Advocate directly at email@example.com, or by telephone at (317) 232-4692. Submit supporting information and documents to: Indiana Department of Revenue, Office of the Taxpayer Advocate, P.O. Box 6155, Indianapolis, IN 46206-6155.
Where to mail your tax return - use labels for envelope
You'll find mailing labels with the envelope enclosed in this booklet. Returns with payments enclosed have a different post office box number for mailing purposes.
If you are enclosing a payment, please mail your tax return with all enclosures to:
Indiana Department of Revenue
P.O. Box 7224
Indianapolis, IN 46207-7224
For all other filings, please mail your tax return with all enclosures to:
Indiana Department of Revenue
P.O. Box 40
Indianapolis, IN 46206-0040
Envelope - Don't forget the stamp!
Make sure to put a stamp(s) on the envelope. The U.S. Post Office will not deliver your tax return without the proper postage.