IT-20S Booklet — S Corporation Income Tax Return (instructions)

# INDIANA

IT-20S S Corporation Income Tax Booklet

SP 261

INDIANA IT-20S S Corporation Income Tax Booklet Year 2025 Contents What's New for 2025 ..............................................................................................................................................................4 General Information ..............................................................................................................................................................4 General Filing Instructions ...................................................................................................................................................5 Instructions for Completing Form IT-20S ..........................................................................................................................7 Summary of Calculations ...................................................................................................................................................12 Certification of Signatures and Authorization Section ...................................................................................................14 Mailing Options ....................................................................................................................................................................15 Instructions for Schedule E, Apportionment of Income for Indiana ............................................................................15 Instructions for Completing Schedule PTET ...................................................................................................................16 Instructions for Schedule Composite ................................................................................................................................18 Instructions for Schedule I N K-1 .......................................................................................................................................20 Reminders .............................................................................................................................................................................29 Additional Information .......................................................................................................................................................30

I N T I M E e-Services Portal Available I N T I M E, 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 In addition to the functionality listed above, I N T I M E provides increased access and functionality for tax preparers. I N T I M E 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 (eP O A) a uthorization to view customer accounts • View and respond to correspondence for clients We strongly encourage all taxpayers to make payments and file returns electronically whenever possible. I N T I M E allows customers to make estimated payments electronically with just a few clicks.

# What's New for 2025

References to the Internal Revenue Code The definition of adjusted gross income (A G I) i s updated to correspond to the federal definition of adjusted gross income contained in the Internal Revenue Code (I R C). A ny reference to the I R C and subsequent regulations means the Internal Revenue Code of 1986, as amended and in effect on Jan. 1, 2023. F or a complete summary of new legislation regarding taxation, please see the 2025 Legislative Synopsis at w ww.in.gov/dor/files/legislative-synopsis-2025.pdf. Credits • A new credit, Affordable and Workforce Housing Credit (871), is available for developers of affordable rental housing in the state of Indiana. See page 22 for additional information. • A new credit, New Rail Infrastructure Expenditures Tax Credit (883), is available for qualified new rail infrastructure expenditures. See page 28 for additional information. • A new credit, Railroad Expenditures Tax Credit (882), is available for qualified railroad expenditures. See page 28

f or additional information. • A new credit, Small Modular Nuclear Reactor Tax Credit (884) is available for qualified infrastructure investments for the manufacture of small modular nuclear reactors. See page 29 for additional information. • The Film and Media Production Tax Credit (869) is now assignable. See page 25 for more information. • Starting in 2025, S corporations will be able to claim certain credits against PTET. These credits are: ο Credit for out-of-state income taxes for resident shareholders. This is only available if the shareholder is an Indiana resident individual, the S corporation elects to be subject to PTET on the pre-apportioned share of income, and the individual would be entitled to claim the Indiana credit for taxes paid to another state on the income derived from the S corporation. ο Credit for out-of-state income taxes for nonresident shareholders. This is only available if the shareholder is an individual who is a resident of a reverse credit state (Arizona, Oregon, and Washington D.C.) and the individual would be entitled to claim the Indiana credit for taxes paid to another state on the income derived from the S corporation. ο Credit for other nonrefundable Indiana tax credits. This is available only for credits that are available to be passed through to shareholders. For this purpose, EDGE, EDGE-R, and refundable Headquarters Relocation credits are considered non-refundable. Special Note for the One Big Beautiful Bill Act (P.L. 119-21) On July 4, 2025, the One Big Beautiful Bill Act (P .L. 119-21) was signed into law. At this time, Indiana follows the Internal Revenue Code as in effect on Jan. 1, 2023. As a result, Indiana currently does not follow the provisions of P .L. 119-21, and the instructions in this booklet reflect the Internal Revenue Code as in effect on Jan. 1, 2023. The instructions may reflect minor inclusions of P .L. 119-21 solely to explain clarifying adjustments. The Indiana General Assembly in 2026 may enact changes that partially or wholly adopt the provisions of P .L. 119-21. If any changes are adopted, the department will provide updated guidance after the changes are enacted.

# General Information

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 2026. 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, I N 46204. Our homepage provides access to forms, information bulletins and directives, tax publications, email, and various filing options. Visit www.in.gov/dor. 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 I N K-1s) di sclosing 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 (A G I) t ax 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; • 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; • Rendering of a service to customers in Indiana; • 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 (I R C ) 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 I R C . 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 A G I 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 6-8.1- 10-2.1(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 I N 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 A G I 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. 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. 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. 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 15. 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 Section 27, 44, 58). Any passive income and built-in gains of an S corporation that are subject to tax under provisions of the I R C 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 (E F T ). Corporations required to make quarterly estimated payments can use the annualized income installment method calculated in the manner provided by I R C Section 6655(e) as applied to the corporation's A G I tax liability. The threshold for required E F T payments for corporate estimated taxes is $5,000. Estimated payments of less than $5,000 can be made by E F T but are not required to be made by E F T . Estimated tax payments and withholding/composite tax payments can be made via I N T I M E, 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

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 The following instances obligate the S corporation to register with DOR and become an Indiana withholding agent on behalf of each of the following. Withholding on Employees 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 I R C t o withhold federal taxes on those types of payments are also required to withhold on those payments for Indiana tax purposes. 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/reference/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. An S corporation with an employee withholding liability must register as an Indiana withholding agent. DOR assigns an Indiana Taxpayer Identification Number (TID). 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. 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 I N T I M E at intime.dor.in.gov or a third-party vendor. I N T I M E can also be used to file and remit sales tax. Withholding on Shareholders 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 I N-C OMPA 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 I N T I M E, 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 I N K-1 f or each shareholder. For further information, consult Income Tax Information Bulletin #72, which is available at www.in.gov/dor/files/reference/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. 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. 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. 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. Note. The withholding provisions do not apply to nonresident shareholders who are nontaxable trust or estate entities. 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. Withholding Amounts on Nonresident Shareholders.

W ithholding amounts should be remitted by using Form IT-6WTH. A p enalty 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 I N T I M E, D OR'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, I N 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. Check the box at the top of Form IT-20S if filing an amended return. Instructions for Completing Form IT-20S Filing Period and Identification Use Form IT-20S to file: • A 2025 corporation return for a tax year ending Dec. 31, 2025; • A short tax year beginning and ending in 2025; or • A fiscal year beginning in 2025 and ending in 2026. 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. 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 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/reference/dn01.pdf for a list of 2-digit county code numbers. 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 (N A I C S ), 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. B. Indicate the state of the corporation's commercial domicile. C. Indicate the year the initial Indiana return was filed. D. Indicate the accounting method used. E. Indicate the date of election as an S corporation. F. Check the "final return" box only if the corporation is dissolved, liquidated, or has withdrawn from the state. File Form BC-100 to close out any other business tax accounts, such as sales and withholding. Use I N T I M E, 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.

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 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-20R E C.

# 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 2010. Since 2010, 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 2013 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. In this example, the asset was acquired in Jan. 2010 at a purchase price of $120,000. This normally would have a 25-year recovery period, but I R C Section 168 allows for a 15-year recovery period. Tax year 2013 is the last year ABC Company will have reported a qualified restaurant equipment add-back until the end of the 15year recovery period. If this asset was sold before being fully depreciated (using straight-line depreciation), the catch-up modification would be reflected in the year of the sale. However, if this property is held through 2025 (the 15th year of depreciation), ABC Company will report a negative $12,800 catch-up add-back on the 2025 state tax return. Reporting Certain Prior-Y ear 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 (I R C ) that may have become law after Jan. 1, 2023. Therefore, the I R C used to figure Indiana income may not wind up being the same as the I R C 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, 2023,

that acts to modify federal A G I , 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, 2023, you may have to amend your return at a later date to reflect any differences between Indiana and federal law. Y ou 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 I R C 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 I R C to permit I R A withdrawals to be included over three years (e.g., a 2025 withdrawal would be included one-third in 2025, one-third in 2026, and one-third in 2027). If Indiana decoupled from the I R C , the whole amount would be included in 2025, none in 2026, and none in 2027. The Code 120 would be for the two-thirds add-back in 2025, the Code 147 would be for the one-third deduction in 2026 and 2027. These have occurred from time to time but (1) did not affect Indiana because of the specific disaster and (2) the I R C 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 $1,250,000 as its add back. The Schedule I N K-1 issued to Individual will reflect $125,000 (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 I R C 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 A G I 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/reference/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 I R C 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 I R C 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 A G I . 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 I R C 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/reference/ib118.pdf

explains this initial required modification on the allowance of depreciation for state tax purposes and special rules for certain like-kind exchanges.

O O S Municipal Obligation Interest Add-back (3-digit code 137) Interest earned from a direct obligation of a state or political subdivision other than Indiana (out of state, or O O S ) 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/reference/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 I N K-1. For nonresident individuals, include only the apportioned amount of the add-back. Excess Federal Interest Deduction Modification (3-digit code 142) I R C 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 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. 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 I R C 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. Note. If you are claiming a full federal deduction for domestic research expenses for 2025, do not enter an add-back using Code 154 for those expenses. If you are electing to claim a full federal deduction for domestic research expenses for 2022 through 2024 and amend your 2022 through 2024 federal income tax return, amend your Indiana income tax return to reverse any reported Code 154 add-backs based on those expenses and do not claim any further modifications after 2024. For other situations related to research and experimental expenses for 2022 through 2025, this will not be determined until the 2026 Indiana General Assembly session. If any changes are enacted, the department will provide guidance after any changes are enacted. Example. Corporation D E F incurred $100,000 of specified research expenses in 2025. Corporation D E F reported $10,000 of amortized expenses in 2025. Corporation D E F 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 2026 through 2030, Corporation D E F 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/reference/ib19.pdf. Note. Entries made on federal Form 8825 should also be considered when completing entries on line 2. 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. 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 through 23 of the I N K-1. Filers should keep detailed records of the contribution as DOR can ask filers to provide this information at a later date. 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 I R C Section 118. 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. Small Employer Health Insurance Premium Deduction

(3-digit code: 639) If you: • Claimed a federal tax credit for small employer health insurance premiums under I R C Section 45R; and

• Would have been permitted a deduction for those premiums except for the disallowance under I R C 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 I R C 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 I R C Section 280C(c). Note. If you are claiming a full federal deduction for domestic research expenses for 2025, do not enter a Code 641 deduction for those expenses. If you are electing to claim a full federal deduction for domestic research expenses for 2022 through 2024 and amend your 2022 through 2024 federal income tax return, amend your Indiana income tax return to reverse any Code 641 deduction based on those expenses and do not claim any further modifications after 2024. For other situations related to research and experimental expenses for 2022 through 2025, this will not be determined until the 2026 Indiana General Assembly session. If any changes are enacted, the department will provide guidance after any changes are enacted. Example. Corporation D E F incurred $100,000 of specified research expenses in 2025. Corporation D E F reported $10,000 of amortized expenses in 2025. Corporation D E F 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 2026 through 2030, Corporation D E F 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 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 15. For more information, see Income Tax Information Bulletin #12 available at www.in.gov/dor/files/reference/ib12.pdf. Before continuing to lines 5 through 25, complete Schedule I N 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 A G I 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 L I F O 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. Line 13. Multiply the amount on line 11 by 4.9% (.049). On line 13, enter the total computed A G I tax based on the taxable income reported on line 11 of Schedule B. 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.

Summary of Calculations Sales/Use Tax 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 Effective July 1, 2025, use tax also applies to the purchase price of services and items other than tangible personal property that are subject to Indiana sales tax but on which sales tax was not paid in whole or in part. A registered retail merchant for Indiana must report nonexempt purchases used in the Indiana business. This is reported on Form ST-103 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. To report any other unpaid taxes, such as county innkeeper's tax or food and beverage tax, please use form ST-115. 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 I N K-1 from the paying entity.) Do not take any credit for individual or separate estimated tax payments made by the shareholders. 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. Caution. Read this before completing lines 20 through 23. If you are reporting composite tax on line 15 and/or PTET on line 16 and you used credits to reduce the tax due on Schedule Composite, Schedule Composite-COR, and/or Schedule PTET, do not report the portion of the credits applied on those schedules on lines 20 through 23. 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 Indiana state and Marion County withholding taxes may be reported on Form I N-MSID and/or Form I N-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 I N-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 I N-MSID-A to yourself in order to claim the credit for the state and county (if applicable) withholding amounts. 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 I N-EDGE. Enter only (1) the aggregate credit amounts from Schedule I N 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 I N-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 I N-EDGE-R. Enter only (1) the aggregate credit amounts from Schedule I N 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 I N-EDGE-R 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.

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 I N 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 A. S Corporation

Income All Sources B. Distributions from Partnerships / Estates / Trusts C. Distributions Attributed to IndianaS Corporation's Distributive Share of Items 1. Ordinary business income (loss) .............................................. 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. 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 I R C Section 1231 gain (loss) ............................................. 10. Other income (loss) .................................................................. Less Allowable Deductions for State Tax Purposes 11. I R C Section 179 expense deduction .................................. 12A. Portion of expenses related to investment portfolio income, including investment interest expense and other (federal non-itemized) deductions.................................................... 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 .................................................................... 13A 13B 13C 14. Total of Indiana state modifications to distributive share income (see line 2f, Form IT-20S) ........................................................................................ 14B 14C 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

Line 23. Enter the total amount of credits claimed from Schedule I N-O CC, and enclose Schedule I N -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 I N K-1s on behalf of the entity's shareholders who are included on the composite return. Do not include credits from Schedule I N 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 I N -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 amount reported for the 4-digit code provided on Schedule I N K-1 not the 3-digit code utilized on the S Corporation income tax return. 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 https://www.in.gov/dor/files/reference/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. 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 I N 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 I N T I M E, DOR's e-services portal at intime.dor.in.gov. If paying by check, make check payable to Indiana Department of Revenue. 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 "Y es" 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 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, I N 46207-7206. Officer Information An officer of the organization must sign and date the tax return and enter the officer's name and title. 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 F I D o r 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 Please use the addresses below only if you do not file your amended return electronically. If taxes are owed, please mail the completed return to:

P .O. Box 7205 Indianapolis, I N 46207-7205 If taxes are not owed, please mail the completed return to: P .O. Box 7147 Indianapolis, I N 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

# 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 I R C Section 965 or GILTI (I R C 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 6-3-2-12 if the S corporation is itself taxable for federal purposes on such income. • Receipts do not include deemed foreign dividends under I R C 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 if the card charges and fees are regularly billed to Indiana. • Receipts from the performance of fiduciary and other services are attributed to the state where the benefits of the services are consumed. Receipts from the issuance of traveler's checks, money orders, or United States savings bonds are attributed to the state where those items are purchased. • Receipts from investments are attributed to Indiana if the taxpayer's commercial domicile is in Indiana. • Gross receipts from the performance of certain telecommunications and broadcast services are attributed to Indiana if the income-producing activity is in Indiana. If such activities are conducted partly within and partly outside Indiana, the gross receipts from the services are attributable to Indiana if the direct costs incurred in Indiana related to those receipts are greater than the direct costs incurred in any other state, unless the activities are otherwise directly attributed to Indiana according to IC 6-3-2-2.2 or IC 6-3-2-2(f). • Receipts from other services and other intangibles are attributed to Indiana if the benefit of the service or intangible is received in Indiana. Please see [regulations] for further information on whether the receipts from a particular transaction are attributed to Indiana. Sales to the United States Government. The United States government is the purchaser when it makes direct payment to the seller. A sale to the United States government of tangible personal property is in Indiana if it is shipped from an office, a store, a warehouse, or another place of storage in Indiana. See the previous rules for sales other than tangible personal property if such sales are made to the United States government. Other Gross Receipts. On line 6, report other gross business receipts not included elsewhere and pro rata gross receipts from all unitary partnerships, excluding from the factors the portion of distributive share income derived from a non-unitary partnership [45 IAC 3.1-1-153(b)]. On line 7, report direct premiums and annuity considerations received during the taxable year for insurance upon property or risks in Indiana. The terms direct premiums and annuity considerations mean the gross premiums received from direct business as reported in the corporation's annual statement filed with the Department of Insurance. Total Receipts. Complete all lines as indicated. Add all the receipts in Column A (lines 1A through 7A), and enter the total on line 8A. In addition, enter the total receipts from all jurisdictions on line 8B. Apportionment of Income for Indiana Divide line 8A by line 8B. Multiply by 100 to arrive at a percentage rounded to the nearest second decimal place. This is the Indiana apportionment percentage; carry it to the apportionment entry line on the return, line 4 on Form IT-20S. Part II - Business/Other Income Questionnaire Complete all applicable questions in this section. If income is apportioned, enclose the completed Schedule E, Apportionment of Income, with Form IT-20S. The completed Schedule E, Apportionment of Income, must be enclosed with the return. Instructions for Completing Schedule PTET Any S corporation that is either: • Making an election to be subject to PTET, or • Passing through PTET from another entity, must complete Schedule PTET to report the amount of PTET to be passed to each of its shareholders. Note. For PTET, nonprofit corporations are required to be listed on Schedule PTET even though they are not required to be listed on Schedule Composite. Check the box for no Schedule Composite tax due if the PTET is greater than the combined state and composite tax for all shareholders listed on the Schedule PTET and who otherwise would be listed on Schedule Composite. The determination for each shareholder must be made separately. If a shareholder would owe composite tax except for the application of an exception code, all nonresident shareholders who would otherwise be listed on Schedule Composite will be required to be listed on Schedule Composite. Example 1. Corporation A has two individual shareholders, Shareholder B, who is an Indiana resident, and Shareholder C, who is an Illinois resident. Each shareholder has $10,000 of Indiana-source income and PTET of $300. Shareholder C would otherwise have a $300 liability for composite tax, while Shareholder B would not be listed on Schedule Composite because Shareholder B is an Indiana resident. Corporation A can check the box and not file Schedule Composite. Example 2. Same facts as Example 1 except Shareholder C also has a $100 composite county income tax. Corporation A cannot check the box and must file Schedule Composite to list Shareholder C and to report the $100 county tax. Example 3. Same facts as Example 1 except Shareholder B is an Ohio resident and Shareholder C also has a $100 composite county income tax. Corporation A cannot check the box and must file Schedule Composite to list Shareholder C and to report the $100 county tax. Shareholder B also must be included on Schedule Composite even though the PTET will equal Shareholder B's composite/withholding tax. Check the box for no Schedule Composite-COR tax due. This is true even if the S corporation has a nonprofit corporation as a shareholder.

For the computation code box, you must enter one of the following codes: • 01 - The S corporation is electing to be subject to PTET, resident shareholders have their income determined before apportionment, and the tax equals the shareholder's share of income times the individual tax rate for all shareholders. • 02 - The S corporation is electing to be subject to PTET, resident shareholders have their income determined after apportionment, and the tax equals the shareholder's share of income times the individual tax rate for all shareholders. • 03 - The S corporation is electing to be subject to PTET, there are no resident shareholders, and the tax equals the shareholder's share of income times the individual tax rate for all shareholders. • 04 - The S corporation is electing to be subject to PTET, resident shareholders have their income determined before apportionment, and for at least one shareholder the tax exceeds the shareholder's share of income times the individual tax rate. • 05 - The S corporation is electing to be subject to PTET, resident shareholders have their income determined after apportionment, and for at least one shareholder the tax exceeds the shareholder's share of income times the individual tax rate. • 06 - The S corporation is electing to be subject to PTET, there are no resident shareholders, and for at least one shareholder the tax exceeds the shareholder's share of income times the individual tax rate. • 07 - The S corporation is not electing to be subject to PTET, resident shareholders have their income determined before apportionment, and the tax is equal to or less than the shareholder's share of income times the individual tax rate for all shareholders. • 08 - The S corporation is not electing to be subject to PTET, resident shareholders have their income determined after apportionment, and the tax is equal to or less than the shareholder's share of income times the individual tax rate for all shareholders. • 09 - The S corporation is not electing to be subject to PTET, there are no resident shareholders, and the tax is less than or equal the shareholder's share of income times the individual tax rate for all shareholders. • 10 - The S corporation is not electing to be subject to PTET, resident shareholders have their income determined before apportionment, and for at least one shareholder the tax exceeds the shareholder's share of income times the individual tax rate. • 11 - The S corporation is not electing to be subject to PTET, resident shareholders have their income determined after apportionment, and for at least one shareholder the tax exceeds the shareholder's share of income times the individual tax rate. • 12 - The S corporation is not electing to be subject to PTET, there are no resident shareholders, and for at least one shareholder the tax exceeds the shareholder's share of income times the individual tax rate. • 13 - The S corporation is electing to be subject to PTET, resident shareholders have their income determined before apportionment, and the tax is determined after credits. • 14 - The S corporation is electing to be subject to PTET, resident shareholders have their income determined after apportionment, and the tax is determined after credits. • 15 - The S corporation is electing to be subject to PTET, there are no resident shareholders, and the tax is determined after credits. Checking the box on Page 1 of the return AND listing Codes 1 through 6 on Schedule PTET will constitute a PTET election. Codes 7 through 12 are to be used only if you are not electing PTET but you are wishing to pass through PTET paid by another entity to your shareholders as PTET. Please note that you may not pass through more PTET than what was paid on your behalf. See Income Tax Information Bulletin #72B at

www.in.gov/dor/files/reference/ib72.pdf for further information. Codes 13 through 15 are to be used if you are electing to claim nonrefundable credits against PTET. These credits are for: • Taxes from regular credit states (i.e., states with individual income taxes other than Arizona, Oregon, and Washington D.C.) imposed on the S corporation income of individual shareholders, but only if the S corporation elects to be subject to PTET on pre-apportioned income of individuals, • Taxes for reverse credit states on individuals with Indianasource income from the S corporation (Arizona, Oregon, and Washington D.C.), and • Indiana nonrefundable credits allowed to be passed through to shareholders. For this credit, EDGE and EDGE-R credits are considered to be nonrefundable. The following apply to the codes listed above: • If you elect to treat resident shareholders as subject to tax on their share prior to or after apportionment, you cannot change treatment later. However, you can change codes if the tax calculation changes provided that the same calculation method is used (e.g., Code 01 to Code 04, 02 to 05, etc., but not 01 to 02 or 05). • Once codes 01 through 06 are used, you cannot use codes 07 through 12 later. Conversely, if you use codes 07 through 12, you cannot use codes 01 through 06 later. • If you use Codes 3, 6, 9, or 12, and a shareholder is later determined to be a resident, you may make a one-time determination as to whether to elect to treat the shareholder as subject to tax on the shareholder's share of income before or after apportionment. Instructions for Each Column If you have more than 21 owners, attach additional sheets using Schedule PTET. Use the same computation codes on all sheets. Identification Number. If the owner is an individual, list the individual's social security number or individual taxpayer identification number. If the owner is a partnership, estate, trust, or corporation, list the entity's F E I N. L ist the entire nine-digit code. Column A - State of residency. Enter the two-digit postal code for the owner's state of residence. If the owner is a resident of a foreign country, enter "FC" .

Column B - Entity type. Enter the two-digit code associated with the entity. Those entity types are: Code Entity Type 01 Resident Individual 04 Resident Nonprofit corporation 07 Resident Estate/trust other than E S O P or retirement plan 08 Retirement plan/employee stock option plan 21 Nonresident Individual 24 Nonresident Nonprofit corporation 27 Nonresident Estate/trust other than E S O P or retirement plan 28 Nonresident Retirement plan/employee stock option plan For government entities, use code 08 or 28, whichever is appropriate. For retirement plans that are subject to Indiana income tax, use code 07 or 27, whichever is appropriate. Column C - Adjusted gross income.

For individuals, estates, and trusts: • If an S corporation is electing to be subject to PTET on the pre-apportioned share of income, enter the adjusted gross income from Part 4, Line 9 of Schedule IT-20/IT-65 I N K-1. • If an S corporation is electing to be subject to PTET on the post-apportioned share of income, complete a pro forma Schedule I N K-1 for each resident owner as if the owner is a nonresident. Enter the adjusted gross income from the pro forma Schedule I N K-1 from Part 4, Line 9 of Schedule IT-20/ IT-65 I N K-1. For corporations: • If an S corporation is electing to be subject to PTET on the pre-apportioned share of income, complete a pro forma Schedule I N K-1 for each resident owner as if the S corporation had a 100% Indiana apportionment factor. Enter the adjusted gross income from the pro forma Schedule I N K-1 from Part 4, Line 9 of Schedule IT-20/IT-65 I N K-1. • If an S corporation is electing to be subject to PTET on the post-apportioned share of income, enter the adjusted gross income from Part 4, Line 9 of Schedule IT-20/IT-65 I N K-1. Column D - Pass Through Entity Tax. In general, multiply Column C by 3% (if your taxable year ends in 2025) or 2.95% (if your taxable year ends in 2026). However: • If you use computation codes 04, 05, or 06, the tax can be equal to or greater than the general computation. Enter the actual amount of tax credited to the shareholder in Column D. The tax cannot be less than amount generally computed. • If you use computation codes 07, 08, or 09, the tax can be equal to or less than the general computation. Enter the actual amount of tax credited to the shareholder in Column D. The tax cannot be greater than amount generally computed. • If you use computation codes 10, 11, or 12, the tax can be equal to or not equal to the general computation. Enter the actual amount of tax credited to the shareholder in Column D. • If you use computation codes 13, 14, or 15, the tax can be equal to the amount otherwise computed and, if applicable, reduced by credits for taxes paid to other states and for nonrefundable credits. EDGE, EDGE-R, and refundable Headquarters Relocation credits are to be treated as nonrefundable credits. Do not enter less than zero for any shareholder. • If you use entity codes 08 or 28, enter zero. If Column C is less than zero, do not enter an amount less than zero in Column D. Enter the sum of all additional sheets reporting PTET on Line 22. Report the sum of all PTET on Line 23 and carry to Form IT-20S, Line 16. Instructions for Schedule Composite An S corporation that has any shareholders who are nonresidents of Indiana must file a composite return and include all its nonresident shareholders. If you file Schedule PTET and check the appropriate box to indicate that Schedule Composite will not be filed, Schedule PTET will be considered the composite return for the shareholders who otherwise would be required to be reported on Schedule Composite. An S corporation will be assessed a penalty of $500 if it fails to file a composite return that includes all nonresident shareholders. Remitting the $500 penalty with the return does NOT allow the S corporation to avoid the additional 20% failure to withhold penalty. Shareholders may only be excluded from withholding by means of the I N -COMPA waiver form. Every nonresident shareholder must be listed. If a nonresident shareholder has a negative share of income, the shareholder is required to be listed on Schedule Composite. The composite return must be filed with and has the same due date as the S corporation return. If the Internal Revenue Service allows the S corporation an extension to file its income tax return, the due date for its Indiana return is automatically extended for the same period, plus one month. Composite income means each nonresident shareholder's distributive share of income derived from sources within Indiana as determined by the use of the apportionment formula described in IC 6-3-2-2(b) plus Indiana modifications. Filing Requirements for Schedule Composite The following limitations and conditions apply to each shareholder included as a member in the composite return: • No deduction is permitted for carryover of net operating losses or capital losses; • No personal exemption is permitted; • No deduction is allowed for charitable contributions allowed or allowable pursuant to I R C Section 170; • No credit is permitted for taxes paid to other states; • No credit carryovers are permitted (except for those on Schedule I N -OCC); and • All other credits that flow through to shareholders on a pro rata basis are limited to the shareholder's state income tax liability. See the list of Pass-through Tax Credits for more information. An S corporation filing a composite return is liable not only for the tax shown on the return. It is also liable for any additional

tax, interest, and penalty as a result of a subsequent audit or examination. The S corporation should send a copy of the general Indiana filing requirements to each nonresident shareholder. Instructions for Completing Schedule Composite Indicate the Social Security Number (SSN) or Federal Employer Identification Number (F E I N) o f each nonresident shareholder. Subject to the limitations and conditions specified in the filing requirements, separately compute the state tax liabilities on the composite return attributable to each nonresident shareholder. Shareholders who have a negative distributive share after modifications should enter 0 as the amount to be withheld. All non-resident shareholders must be listed even if distributive share is negative and no composite tax is due. Note. The SSN of all nonresident individuals of reverse credit agreement states 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 must be listed on the Schedule Composite, but with the amount of withholding tax/credit for these shareholders listed as zero. Column A. If a shareholder has an exception where the shareholder may not be subject to tax, enter the exception code applicable to that shareholder. If no exception code applies to a shareholder, leave the column blank. If an invalid code is entered, this will be treated as a blank code. If a code is entered into this column, compute the values for Columns D and F based on the proper amount of tax due rather than based on Column C and E. The codes 03 through 12 will require a signed I N-C OMPA from the shareholder. Failure to obtain and include a signed I N-C OMPA will require the S Corporation to withhold as otherwise required under IC 6-3-4-13. • Code 01 - Approved alternative arrangement. This is available only if DOR has approved an alternative withholding arrangement with the corporation responsible for paying the tax. Y ou must maintain DOR's approval of the arrangement with your records as DOR can require you to provide it at a later date. • Code 02 - Credit used to offset composite tax. If the shareholder would have been entitled to claim a nonrefundable tax credit that flowed through from the corporation to reduce the shareholder's income tax liability, the corporation may reduce the amount of composite tax by the shareholder's share of such credit. Do not reduce the tax in Column G by more than the shareholder's share of any credits that properly passed through to the shareholder. Also, you may only reduce the tax by the amount of current year credit. Finally, you may not use this code to reduce composite tax for credits that did not flow through from the corporation. • Code 03 - Employee Stock Ownership Plan Enter this code if the shareholder is an employee stock option plan (E S O P). • Code 04 - Income offset by previously disallowed deductions. If: ο a shareholder is determined to have zero basis on their share of the corporations stock, and ο the shareholder has deductions that were disallowed because the shareholder had zero basis, the share of income subject to tax can be reduced by the newly-allowed Indiana deductions and the tax recomputed after the newly-allowed deductions. • Code 09 - Treaty-based exclusion. If a shareholder is subject to a treaty-based exception from federal income tax, the scope of the treaty includes the income derived from the corporation, and the corporation has knowledge of the shareholder's exemption, enter this code for the shareholder. • Code 10 - Passive activity losses. Enter this code if the shareholder has passive income from the corporation that is offset by previously-disallowed passive losses. Do not reduce the income subject to tax by more than the passive loss reported as previously disallowed. • Code 11 - Net operating losses. Enter this code if the shareholder has an Indiana net operating loss carryforward that can offset the income in whole or in part. Do not reduce the income subject to tax by more than the net operating loss reported. • Code 12 - Credits from other sources. Enter this code if the shareholder indicates one or more credits that would reduce the tax liability. These should be either a carryforward credit regardless of source or a credit from a source other than the corporation. Do not enter a credit used to reduce tax using Code 02. In addition, the tax cannot be reduced by more than the credits reported by the shareholder. • Code 14 - Entity has multiple tiers. If the corporation is part of a multi-tiered structure and has obtained written department consent for an alternative withholding arrangement, enter this code. The written consent of the department must be attached or otherwise made available upon department request. • Code 15 - Shareholder is an Indiana resident. Enter this code if the shareholder is an Indiana resident and tax is reported as being withheld on behalf of the shareholder. This withholding can occur directly or indirectly, such as withholding in a tiered pass-through structure. • Code 17 - Allowance for Schedule IN-COMPA for similarly situated partners. If you have five or more shareholders that otherwise would be required to provide a Schedule IN-COMPA to report an entity-based exemption (e.g., non-profit or employee stock option plan), you can use this code for those shareholders if you do not receive a Schedule IN-COMPA. • Code 18 - Negative shareholder/partner income. If the shareholder has a negative distributive share income after modifications, you can enter this code to report the shareholder's information. Failure to list one or more nonresident shareholders will subject the corporation to a potential $500 penalty. • Code 19 - Withholding greater than tax computed. If a nonresident shareholder has more tax withheld than the amount that otherwise is due, enter this code. This will prevent unintended refunds/overpayments at the S corporation level. If the corporation is an Indiana resident, use exception code 15. Column B. Enter the 2-character state of residency for each nonresident listed. Column C. Enter the Indiana adjusted gross income from Schedule I N K-1, Part 4, line 9. Column D. State Tax. Multiply the adjusted gross income by .03 (.0295 for years ending in 2026).

Column E. Enter total amount from Schedule PTET. Column F. Multiply the amount in Column C by the county tax rate associated with the county reported on Schedule I N K-1, lin e 7. This rate is listed on Schedule CT-40PNR, which is located at Notwithstanding any other requirement, a nonresident individual who is subject to Indiana county income tax on Schedule Composite (Column F) is required to file a nonresident individual income tax return, Form IT-40PNR, to report all sources of Indiana income. Note. If the nonresident owner is also employed by the business, the business shall use the county reported on the owner/ employee's WH-4 to determine whether or where withholding is required. Example. Individual X, a nonresident of Indiana, is a 50% owner of a business that operates in St. Joseph County and Elkhart County. Individual X works at the business's St. Joseph County location. The business has $200,000 in Indiana adjusted gross income, with 60% of the receipts derived from St. Joseph County and 40% from Elkhart County. Of Individual X's $100,000 income, $60,000 ($100,000 x 60%) from St. Joseph County is subject to county income tax and withholding and the remaining $40,000 from Elkhart County is not subject to county income tax. Get Income Tax Information Bulletin #72 at

www.in.gov/dor/files/reference/ib72.pdf for additional information. Column G. If the amount in Column E is greater than the amount in Column D, enter the amount from Column F . Leave blank if less than zero. Enter the amount from Schedule Composite, line 15G, on Form IT-20S, line 15. Note. A federal Schedule K-1 for each shareholder is not required to be enclosed but must be made available for inspection upon request by DOR. If there are any questions, please visit www.in.gov/dor for additional information. Instructions for Schedule I N K-1 Enclose each shareholder's Schedule I N K-1 w ith Form IT-20S. Also, provide a completed copy of Schedule I N K-1 t o each shareholder. Beginning with tax years ending after Dec. 31, 2019, a taxpayer that is required to file 25 or more Schedule I N K-1s must file the Schedule I N K-1s in an electronic format. This means that filing the IT-20S return with accompanying I N K-1s must be done through modernized e-file (MeF). For taxpayers filing on a calendar year basis, this electronic filing requirement began with tax year 2020. Part 1 - Shareholder's Identification Section Complete Schedule I N K-1 t o identify each shareholder. C heck the box if filing an amended return. Line 1. Enter the name of the shareholder (individual, entity, trust name, etc.). If the legal shareholder is a disregarded entity, enter the name of the beneficial owner. Line 2. Enter the shareholder's Social Security number if an individual or the shareholder's federal employer identification number (F E I N) if t he shareholder is another entity. If the legal shareholder is a disregarded entity, enter the FEIN of the beneficial owner Line 3. Enter the applicable pro rata percentage of the shareholder's interest in the S corporation. The percentage should be adjusted to an annual rate if necessary. Line 4a and b. If the shareholder is a disregarded entity (DE), enter the shareholder's name and F E I N (s ee instructions for federal Schedule K-1 at www.irs.gov/forms-instructions-and-publications). Line 5. List the type of entity of the shareholder for whom you are issuing the Schedule I N K-1. Line 6. Enter the shareholder's state of residence or commercial domicile. Line 7. If shareholder was an Indiana nonresident individual on Jan. 1, 2025, and worked in Indiana as of Jan. 1, 2025, then enter the individual's 2-digit county of employment in this box. Y ou may get the 2-digit code number from Departmental Notice #1, located at www.in.gov/dor/files/reference/dn01.pdf. Line 8. Enter the name of the entity that remitted actual payment of the withholding. Line 9. Enter the F E I N o f the paying entity. Note: Do not obscure any digits when entering the F E I N. Line 10. Enter the amount of PTET paid. Line 11. Enter the amount of Indiana state tax withheld. This amount should only include payments made into the corporate account and withholding amounts passed through by another entity. Line 12. Enter the amount of Indiana county tax withheld.

# Part 2 - Pro Rata Share of Indiana Pass-through

Tax Credits from S Corporation If the S corporation has available any eligible Indiana credits flowing through to the shareholders, enter the following: • F E I N number from the entity that the credit was awarded to. If the credit is passed through from another entity enter the F E I N from Schedule I N K-1; • The credit's certification year; • For credit codes 818, 820, 835, 849, 860, 863, 865, 867, 868, 869, 871, 874, 875, 878, 879, 882, 883, 884, 1818, 1820, 1835, 1849, 1860, 1863, 1865, 1867, 1868, 1869, 1871, 1875, 1879, 1882, 1883, and 1884 the credit's certification, project, or PIN number; • The credit's 3- or 4-digit credit code; and • The pro rata amount of credits allotted to each shareholder.

A completed Schedule I N -OCC (credit schedule) must be enclosed with Form IT-20S to support the credit distribution for certified credits; otherwise, the credits will be denied. See the descriptive list of pass-through tax credits that may be available to a pass-through entity on page 22. Each credit is assigned a 3- or 4-digit code number. This should be used for identification purposes when reporting and claiming these credits. For more information, see Income Tax Information Bulletin #59 available at www.in.gov/dor/files/reference/ib59.pdf. Note. The 3-digit codes utilized on behalf of each shareholder on the I N -OCC towards composite tax should be reflected as a 4-digit codes on Part 2 of Schedule I N K-1. Any pro rata portion of the shareholder's credit above the 4-digit amount previously utilized towards composite tax should be reported on Part 2 of Schedule I N K-1 as a 3-digit code and the remaining amount reflected in the amount claimed column. Example. Company A used $400 of the shareholder/partner's $700 total Hoosier Business Investment Credit to offset the tax liability on the composite filing. The shareholder/partner has $300 remaining credit. Schedule I N K-1 will breakdown the credit as follows: Credit Name 3- or 4- Digit Code Amount Hoosier Business Investment Credit - Composite 1820 $400 Hoosier Business Investment Credit 820 $300 If the shareholder/partner has other taxable Indiana-source income, Form IT-40PNR, reporting all Indiana-source income (including the income taxed on the composite return) should be filed. When completing the I N -OCC, the shareholder/partner will be able to use up to $700 of the HBI credit, using the amount associated with the 4-digit number first. For example, if the total state tax liability is $500, "HBI 1820 $400" will be listed on Schedule I N -OCC, and the remaining amount is then reported as needed as "HBI 820 $100. " A 3-digit code 820 in the amount of $200 remaining will be available to carryforward. Credits reported on Part 2 of Schedule I N K-1 that are used to offset tax liabilities will be reported on the following lines: • Any credits not requiring an I N -EDGE, I N -EDGE-R, or I N -OCC schedule will be reported on line 19 • EDGE credit code 839 will be reported on line 20 • EDGE-R credit code 857 will be reported on line 21 • I N -OCC credit codes 818, 820, 835, 849, 860, 863, 865, 867, 868, 869, 871, 874, 875, 878, 879, 882, 883, 884, 1818, 1820, 1835, 1849, 1860, 1863, 1865, 1867, 1868, 1869, 1871, 1875, 1879, 1882, 1883, and 1884 will be reported on line 22.

# Part 3 - Distributive Share Amount

Complete lines 1 through 13 for the shareholder. Also provide the shareholder with a statement showing the distributive share of income, credits, and modifications. Line 1 through line 13b. For full-year Indiana resident shareholders, complete these lines as shown on the federal Schedule K-1, Form 1120S. For most nonresident shareholders, the federal Schedule K-1 amounts should be multiplied by the Indiana apportionment percentage. This is calculated on the Schedule E (see the instructions beginning on page 15). The apportioned amounts should be entered on lines 1 through 13b. If any entries on lines 2 through 11 represent nonbusiness income to the S corporation, these amounts are allocated to the appropriate state. Line 4. "Guaranteed payments" is for those filing an IT-65. Leave this line blank. Line 6. "Ordinary dividends" corresponds to line 5a on the federal K-1. Line 9, "Net long-term capital gain (loss), " corresponds to line 8a on the federal K-1. On line 13a or 13b, include investment interest expenses attributed to royalty income and all other federal deductions. (This excludes those treated as itemized deductions.) Do not report any other type of investment interest expense, itemized deduction, or carryover loss on this line. Line 14. Add the sum of lines 1 through 11 and subtract lines 12, 13a, and 13b. The amount on this line is used solely to determine the income subject to withholding and Pass Through Entity Tax. The partner must make any determinations related to the taxability of these items based on the partner's own circumstances. Note. If the corporation has received any distributions from other entities having income previously apportioned to Indiana, use the following method to report distributive share income for Schedule I N K-1. Alternative Completion of Schedule I N K-1 Information for Part 3 An alternative application of Schedule I N K-1 must be used if: • A shareholder is a nonresident individual, fiduciary, or trust; and • The corporation had income from outside Indiana. Use the following method for completing Schedule I N K-1 when the corporation had any apportioned income from outside Indiana or is otherwise required to complete the Indiana apportionment schedule. Modify each required Schedule I N K-1 line entry by recalculating the pro rata share of total S corporation income with required Indiana modifications to adjusted gross income reported on line 1 of Form IT-20S. Use the pro rata amount from line 13A, Worksheet for S Corporation Distributive Share Income, Deductions, and Credits, by applying these steps: Step 1. Deduct from the above pro rata share the respective pro rata amount of line 13B and line 14B of the worksheet.

Step 2. Multiply the result by the Indiana apportionment percent reported on line 4 of Form IT-20S, from Schedule E, line 8, if present. This amount should reflect the shareholder's proportionate share of this S corporation's activity in Indiana. Step 3. Add to the previous amount the pro rata share of any other (entity) source income received by the corporation that was previously apportioned or allocated as distributive share income derived from Indiana (line 15C of the worksheet). The result is the modified Indiana S corporation income from Indiana sources to be reported on the appropriate lines of Schedule I N K-1 o f nonresident individuals, trusts, and estates.

# Part 4 - State Modifications

Lines 1 through 7. Enter the Indiana modifications from Form IT- 20S, lines 2a through 2e (and any additional sheets), as percentage applied, or apportioned in the case of nonresident individuals. List the pro rata share amount of each modification on the appropriate line. (Use a minus sign to denote negative amounts.) Line 8. Enter the total distributive share of modifications. Add lines 1 through 7. Line 9. Add Part 3, line 14, to Part 4, line 8. For nonresident shareholders, carry this amount to Schedule Composite, Column C. Pass-through Tax Credits Unless specifically noted, each shareholder is allowed a pro rata share of the income tax credits available to the S corporation. If the pass-through entity does not have a state A G I t ax liability (Schedule B tax computation) against which the tax credit must be applied, the shareholders of the pass-through entity are entitled to a pro rata share of the computed credit. An S corporation may not carry over credits. Any credits from a prior tax year must be passed through to the shareholders and any carryover determined at the shareholder level. Also, do not complete Schedule I N-O CC, Part B. Each shareholder's share of an available credit is reported on Schedule I N K-1, Part 2. It also must be supported by enclosing the proper, completed tax credit form with the corporation's return. The shareholders can claim the allowable portion of Indiana credits on the respective annual income tax returns: Form IT-40, IT-40PNR, or IT-41. Caution. Within a certain group of credits, a taxpayer may not be granted more than one credit for the same project. The credits included for this group are as follows: • Community Revitalization Enhancement District Credit; • Enterprise Zone Investment Cost Credit; • Hoosier Business Investment Credit; • Industrial Recovery Credit; and • Venture Capital Investment Credit. Apply this restriction first when figuring allowable credits. See Income Tax Information Bulletin #59 at www.in.gov/dor/files/reference/ib59.pdf for more information. Order of Credit Application If claiming more than one credit, first use the credits that cannot be carried over and applied against the state adjusted gross income (A G I) t ax in another year. Next, use the credits that can be carried over for a limited number of years and applied against the state A G I tax. If one or more credits are available, apply the credits in the order that the credits would expire. Finally, use the credits that can be carried over and applied against the state A G I t ax in another year. Example. A taxpayer has a the following credits available to be claimed: • A neighborhood assistance credit for which no carryover is available, • A school scholarship credit that can be carried forward to 2026, and • A community revitalization enhancement district credit with an indefinite carryforward period. The taxpayer would apply the credits in the following order until the credit is exhausted or the taxpayer's liability is reduced to zero, whichever comes first: • Neighborhood assistance credit • School scholarship credit (expiring in 2026) • Community revitalization enhancement district credit (indefinite carryforward period) For more information about Indiana tax credits, see Information Bulletin #59 available at www.in.gov/dor/files/reference/ib59.pdf. The following credits have each been assigned a 3-digit code number for identification purposes. Use the code numbers when reporting and claiming any of these credits. See Income Tax Information Bulletin #59 available at www.in.gov/dor/files/reference/ib59.pdf

f or more information about Indiana tax credits. Affordable and Workforce Housing Credit 871 A taxpayer is eligible to claim a credit for the construction of a qualified low income building located in Indiana. In addition, the qualified low income building must be a building for which a federal affordable housing tax credit was awarded using a 30% present value of the qualified basis for the building and is financed by tax exempt bonds subject to federal private activity bond volume cap. The amount of the credit is determined by the Indiana Housing and Community Development Authority (IHCDA). The credit determined by IHCDA is a five-year credit, with 20% of the credit first allowable each year for five years (e.g., a credit of $1,000,000 for a building placed in service in 2025 will be $200,000 first claimable in each year from 2025 to 2029). The credit may be assigned in writing. Any unused credit may be carried forward for nine years following the first year of the credit period. In other words, for a credit related to a project placed in service in 2025 to be claimed for 2025 through 2029, the credits for all years expire in 2034. The credit can be assigned in writing. If you are assigning a credit or are receiving a credit by assignment, additional guidance will be provided for submission and handling of assigned credits.

Enter Code 871 on Part A of Schedule IN-OCC for the year in which you are claiming the credit. Include the certification/ project number provided by IHCDA for the project (or relevant portion of the project) when you claim the credit. If necessary, complete Part B of Schedule IN-OCC to report credits claimed from a carryover or credits to be carried over. Airport Development Zone Employment Expense Credit 800 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Airport Development Zone Investment Cost Credit 801 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Airport Development Zone Loan Interest Credit 802 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Alternative Fuel Vehicle Manufacturer Credit 845 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Attainable Homeownership Tax Credit 875 A credit is available for contributions of cash and other property made to Habitat for Humanity of Indiana. The credit is for 50% of any allowable contributions up to a maximum credit of $10,000 per taxable year. In addition, the total amount of credits per state fiscal year is limited to $4,000,000. Note. Certification for this credit must be obtained from Habitat for Humanity of Indiana. Contact Habitat for Humanity at taxcredit@habitatindiana.org or at Habitat for Humanity of Indiana, Inc., 101 W . Ohio St., Suite 2000, Indianapolis, I N 46204. The approved credit must be reported on Schedule I N -OCC, found at Make sure to enclose this schedule with your tax filing. Benefit Corporation Employment of Individuals with Disability Tax Credit 881 A credit is available for employers that hire individuals referred to the employer for employment through a vocational rehabilitation services program for individuals with a disability. If all the following criteria are met, you are eligible for the credit: • Y ou are a benefit corporation as defined in IC 23-1.3-2-3 • Y ou are an employer that did not have more than 50 employees at any time during the taxable year; • Y ou hire an individual referred to the employer for employment through a vocational rehabilitation services program for individuals with a disability (the "credit-eligible employee"); • The credit-eligible employee was first hired by the employer after Dec. 31, 2023; • The credit-eligible employee works at least an average of 20 hours per week for the employer and at a similar compensation rate as other employees performing the same or similar tasks; and • The credit-eligible employee is not hired to replace an employee who was terminated unless the terminated employee was terminated for misconduct, or the terminated employee voluntarily left their position. The credit is equal to 30% of the credit-eligible's employee's wages for the first year for which the credit-eligible employee's wages are allowable for purposes of the credit. The credit increases to 40% of wages for the second year and 50% for the third and subsequent years. DOR may contact you to complete Form EDTC W-1, Employment of Individuals with Disability Tax Credit Worksheet, to provide additional information related to the credit. Additional instructions will be provided upon issuance of the Form EDTC W-1. Blended Biodiesel Tax Credits 803 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Community Revitalization Enhancement District Credit 808 A state and local income tax liability credit is available for a qualified investment for the redevelopment or rehabilitation of property within a community revitalization enhancement district. To be eligible for the credit, the intended expenditure plan must be approved by the Indiana Economic Development Corporation (IEDC) before the expenditure is made. The credit is equal to 25% of the IEDC-approved qualified investment made by the taxpayer during the tax year. DOR has the authority to disallow any credit if the taxpayer: • Ceases existing operations within the district or elsewhere in Indiana; • Substantially reduces its operations within the district or elsewhere in Indiana; or • Reduces other Indiana operations to relocate them into the district. The taxpayer can assign the credit to a lessee who remains subject to the same requirements. The assignment must be in writing. Any consideration may not exceed the value of the part of the credit assigned. Both parties must report the assignment on state income tax returns for the year of assignment. Enclose the certification from the IEDC; otherwise, the credit will be denied. Contact the Indiana Economic Development Corporation at One North Capitol, Suite 700, Indianapolis, I N 46204, or visit the website at www.iedc.in.gov for more information about this credit. Economic Development for a Growing Economy (EDGE) Credit 839 This credit is for businesses that conduct certain activities designed to foster job creation in Indiana. It is a refundable tax liability credit. Note. Schedule I N -EDGE must be completed and enclosed with the IT-20S. Otherwise the credit will be denied. A PIN must be obtained from the IEDC.

Claim this credit on line 19 of the return or Part 2 of the I N K-1. Contact the Indiana Economic Development Corporation at One North Capitol, Suite 700, Indianapolis, I N 46204, for eligibility requirements or visit www.iedc.in.gov for additional information. Economic Development for a Growing Economy Retention (EDGE-R) Credit 857 This credit is for businesses that conduct certain activities designed to foster job retention in Indiana. It is a refundable tax liability credit. Note. Schedule I N-EDGE-R must be completed and enclosed with the IT-20S. Otherwise, the credit will be denied. A PIN must be obtained from the IEDC. Claim this credit on line 20 of the return or Part 2 of the I N K-1. If claiming the EDGE or EDGE-R credit at both the corporate and pass-through levels, the amount of credit claimed may not exceed the total credit approved for the corporation. When claiming at the pass-through level, the Schedule I N-EDGE or I N-EDGE-R must be enclosed with the IT-20S return. Contact the Indiana Economic Development Corporation at One North Capitol, Suite 700, Indianapolis, I N 46204, for eligibility requirements or visit www.iedc.in.gov for additional information. Economic Development for a Growing Economy - Nonresident Employees (EDGE-NR) 865 This credit is for incremental state income tax amounts that would have been withheld on employees from reciprocal states if those employees had been subject to Indiana state tax withholding. Owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc., are eligible for this credit. Unlike the EDGE and EDGE-R credits, the EDGE-NR credit is a nonrefundable credit. This credit is administered by the IEDC. Contact them at One North Capitol, Suite 700, Indianapolis, I N 46204, via website at www.iedc.in.gov, or by phone at 317-232-8800. The approved credit must be reported on Schedule I N-OCC, found at www.in.gov/dor/tax-forms/individual/current. Make sure to enclose this schedule with your tax filing. If you are claiming this credit as an owner of a pass-through entity such as S corporations, partnerships, limited liability companies, etc., make sure to keep Schedule I N K-1 with your records as DOR can require you to provide this information. Employer Child Care Expenditure Credit 876 A credit is available for employers with 100 or fewer employees who incur certain costs for establishing new Indiana licensed childcare facilities for their employees' children. The credit is 50% of the employer's qualified expenditures for Indiana licensed childcare facilities, up to a maximum credit of $100,000 per employer. The amount of allowable credits is $2,500,000 per state fiscal year and is awarded in the order of returns claiming the credit. Qualified expenditures for purposes of this credit are limited to expenses: • For the acquisition, construction, rehabilitation, or expansion of property used as part of an Indiana qualified childcare facility of a taxpayer that is operated for the taxpayer's employees; • Incurred under a contract between a taxpayer and an Indiana qualified childcare facility to provide for the acquisition, construction, rehabilitation, or expansion of property used as part of the Indiana qualified childcare facility; or • For purposes of complying with the qualified child care facility licensure requirements under IC 12-17.2, as part of the taxpayer acquiring or constructing an Indiana qualified child care facility. This credit is not available for employers who were in the business of operating a childcare facility prior to making qualified expenditures allowable for this credit. If you take this credit, the credit may be recaptured if certain events occur within five years after the credit was allowed. These events are: • Cessation of the operation of the Indiana qualified childcare facility as an Indiana qualified childcare facility; • A change in ownership of an Indiana qualified childcare facility for which a credit was allowed under this chapter, unless the person acquiring an interest agrees to assume the recapture liability of the person disposing of an interest; or • The use of an Indiana qualified childcare facility for the enrollment of a child from any individual who is not an employee of the taxpayer. However, cessation or changes in ownership as a result of accident or casualty are not subject to credit recapture. The credit recapture is 100% of the credit if the event occurs in the year after the credit is allowed. The recapture percentage is reduced by 20% each year for the next four years, and any event occurring in the sixth year after the credit is first allowed is not subject to recapture. Employment of Individuals with Disability Tax Credit 877 A credit is available for employers that hire individuals referred to the employer for employment through a vocational rehabilitation services program for individuals with a disability. If all the following criteria are met, you are eligible for the credit: • Y ou are an employer that did not have more than 500 employees at any time during the taxable year; • Y ou hire an individual referred to the employer for employment through a vocational rehabilitation services program for individuals with a disability (the "credit-eligible employee"); • The credit-eligible employee was first hired by the employer after Dec. 31, 2023; • The credit-eligible employee works at least an average of 20 hours per week for the employer and at a similar compensation rate as other employees performing the same or similar tasks; and • The credit-eligible employee is not hired to replace an employee who was terminated unless the terminated employee was terminated for misconduct or the terminated employee voluntarily left their position.

If you are receiving the credit as a result of an interest in a partnership, the eligibility is determined at the partnership level. The credit is equal to 20% of the credit-eligible employee's wages for the first year for which the credit-eligible employee's wages are allowable for purposes of the credit. The credit increases to 30% of wages for the second year and 40% for the third and subsequent years. If you claim this credit as a result of your own activities as opposed to those reported on a Schedule I N K -1 or IT-41 Schedule I N K -1, DOR may contact you to complete Form EDTC W-1, Employment of Individuals with Disability Tax Credit Worksheet, to provide additional information related to the credit. Additional instructions will be provided upon issuance of the Form EDTC W-1. Note. If you are a benefit corporation (as defined in IC 23-1.3-23) and did not have more than 50 employees at any time during the taxable year, see the instructions for Benefit Corporation Employment of Individuals with Disability Tax Credit, Code 881, on page 23. Enterprise Zone Employment Expense Credit 812 This credit is available for employers based on qualified investments made within Indiana. It is the lesser of 10% of qualifying wages or $1,500 per qualified employee, up to the amount of tax liability on income derived from an active enterprise zone. Enclose the completed Schedule EZ 2 with Form IT-20S return, otherwise the credit will be denied. See Indiana Schedule EZ Parts 1, 2, and 3 available at

for more information about how to calculate this credit. Enterprise Zone Investment Cost Credit 813 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. For additional information, contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, I N 46204 or visit their website at www.iedc.in.gov. Enterprise Zone Loan Interest Credit 814 This credit can be for up to 5% of the interest received from all qualified loans made during a tax year for use in an active Indiana enterprise zone. See Income Tax Information Bulletin #66 available at

ww w.in.gov/dor/files/reference/ib66.pdf and Schedule L I C ava ilable at www.in.gov/dor/tax-forms/other-forms/enterprise-zone-forms f or more information about how to calculate this credit. Enclose the completed enterprise zone Schedule L I C wit h the Form IT-20S return. For more information, contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, I N 46204. Call IEDC at 317-232-8800 or visit www.iedc.in.gov. Enclose the certification from the IEDC; otherwise, the credit will be denied. Ethanol Production Tax Credit 815 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Film and Media Production Tax Credit 869 Effective July 1, 2022, a credit is available for expenses incurred for qualified film and media production expenses. The amount of the taxpayer's credit is equal to the taxpayer's qualified film and media production expenses multiplied by a percentage determined by the Indiana Economic Development Corporation, but not more than 30% of the expenses. Beginning July 1, 2025, any single film and media production tax credit may not exceed $250,000. Effective Jan. 1, 2026, a taxpayer may assign any part of the film and media production credit that the taxpayer may claim. The assignment must be in writing and the taxpayer must notify the IEDC in the manner prescribed by the IEDC. Both the taxpayer and assignee shall report the assignment on their AGIT returns for the year in which the credit was assigned. The taxpayer may not receive value in connection with an assignment that exceeds the value of the part of the credit assigned. Note. Certification for this credit must be obtained from the Indiana Economic Development Corporation.

S ee www.indianacreates.com for further information. This credit must be reported on Schedule I N-OC C, found at w ww.in.gov/dor/tax-forms/corporate/current-corporatepartnership. Make sure to enclose this schedule with your tax filing. Enclose the certification letter from the IEDC with the return, otherwise the credit will be denied. Foster Care Donations Credit 867 A credit for donations to qualifying foster care organizations is available. In addition, beginning July 1, 2023, a credit for qualifying contributions to the Insuring Foster Y outh Trust Fund is also available. The credit is 50% of the donation made to qualifying organizations, up to a maximum of $10,000 per taxable year. In addition, no more than $2,000,000 in credits can be awarded during a calendar year.

S ee www.in.gov/dor/tax-forms/other-forms/foster-credit for further information regarding the application and approval process. This credit must be reported on Schedule I N-OC C, found at w ww.in.gov/dor/tax-forms/corporate/current-corporatepartnership. Make sure to enclose this schedule with your tax filing. Enclose the approval letter from the Department of Revenue with the return, otherwise the credit will be denied. Headquarters Relocation Credit - Offset 818 &/or Refundable A business may be eligible for a credit if it meets one of two sets of criteria. The first set of criteria ("first test") is that the business meets all of the following: • Has an annual worldwide revenue of $50 million; • Has at least 75 Indiana employees (for credits awarded before July 1, 2022); and • Relocates its corporate headquarters to Indiana. The second set of criteria ("second test") is that the business meets either (1) or (2), meets (3), and meets (4) or (5):

1. Received at least $4 million in venture capital in the six months immediately preceding the business's application for this tax credit. 2. Closes on at least $4,000,000 in venture capital not more than six months after submitting the business's application for this tax credit. 3. Has at least 10 Indiana employees (for credits awarded before July 1, 2022). 4. Relocates its corporate headquarters to Indiana. 5. Relocates the number of jobs equal to 80% of the business's total payroll during the immediately preceding quarter to an Indiana location. Important. While both the entity and the owners may be eligible to claim an offset credit (818), only the owners are eligible to claim their share of any refundable credit if the IEDC has granted a refundable credit under the second test above. The credit may be as much as 50% of the cost incurred in relocating the taxpayer's headquarters. For more information (including limitations on the credit and the application process), see Income Tax Information Bulletin #97, available at

This credit must be reported on Schedule I N-O CC, found at Make sure to enclose this schedule with your tax filing. This credit is administered by the IEDC. Contact them at One North Capitol, Suite 700, Indianapolis, I N 46204, v ia website at www.iedc.in.gov, or by phone at 317-232-8800. Submit a copy of the letter from the IEDC which: • Verifies the amount of tax credit for the taxable year, and • Designates the amount of credit that is refundable (if any). Enter code 818 on Schedule I N K-1 t o: • Designate any offset portion of this credit, and/or • Designate any refundable portion of this credit. Maintain with your records proof of the relocation costs as well as proof of employment of the minimum number of employees in Indiana and, if applicable, payroll in both Indiana and everywhere, as DOR may request this information at a later date. Health Reimbursement Arrangement Credit 878 A credit is available for employers that make contributions to health reimbursement arrangements for their employer. The credit is available for the first two years that the employer: • Provides an amount toward the health reimbursement arrangement is equal to or greater than either the level of benefits provided in the previous benefit year; or • If the amount the employer contributes toward the health reimbursement arrangement equals the same amount contributed per covered individual toward the employer provided health insurance plan during the previous benefit year. To qualify for this credit, an employer must not have more than 50 employees at any time during the taxable year. The credit for the employer is equal to the lesser of: • The amount contributed to the health reimbursement arrangement during the taxable year, or • $400 for the first year the employer qualifies for the credit, $200 for the second year the employer qualifies for the credit, and $0 for the third and subsequent years. These limitations are computed on an employee-by-employee basis. In addition, the credit is capped at $10,000,000 per fiscal year for all taxpayers and is awarded in the order of returns claiming the credit. The approved credit must be reported on Schedule I N- OCC, found at However, you will not have a certification/project number for this credit. If you are required to enter a certification number, enter a numeric value. Make sure to enclose this schedule with your tax filing. Note. This credit cannot be passed through and cannot be used to reduce or eliminate nonresident withholding tax due. Historic Building Rehabilitation Credit 819 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Historic Rehabilitation Tax Credit 879 A credit is available for certain expenses for rehabilitation of qualified historic structures. A qualified historic structure is a building that is: • A certified historic structure as defined in I R C S ection 47(c)(3); • Individually listed on the register of Indiana historic sites and historic structures; or • Located in, and contributes to, a district listed in the register of Indiana historic sites and historic structures. If you: • Incurred costs and expenses for the restoration and preservation of a qualified historic structure; • The costs and expenses are defined as a qualified rehabilitation expenditure in I R C S ection 47(c)(2); and • The costs and expenses are at least $5,000 you are eligible for a credit of 25% of the qualified rehabilitation expenses. In the case of a qualified rehabilitation expenditures incurred for non-income producing property, the credit is 30% of the qualified rehabilitation expenses. The credit is available for the year in which the restoration and preservation of the qualified historic structures. See

w ww.irs.gov/pub/irs-sbse/qualified-rehabilitation-expenditures.pdf f or further information on expenses that do and do not qualify as a qualified rehabilitation expenditure. This credit is administered by the IEDC. Contact them at One North Capitol, Suite 700, Indianapolis, I N 46204, v ia website at www.in.gov/dor, or by phone at 317-232-8800. The approved credit must be reported on Schedule I N-O CC, found at www.in.gov/dor/tax-forms/individual/current. Make sure to enclose this schedule with your tax filing.

Hoosier Business Investment Credit 820 This credit is for qualified investments, including costs associated with the following: • Constructing special-purpose buildings and foundations; • Making onsite infrastructure improvements; • Modernizing existing equipment; • Purchasing equipment used to make motion pictures or audio production; • Purchasing or constructing new equipment directly related to expanding the workforce in Indiana; • Retooling existing machinery and equipment; • Purchasing retooled or refurbished machinery; • Constructing or modernizing transportation or logistical distribution facilities; • Improving the transportation of goods via highway, rail, air, or water; • Improving warehousing and logistical capabilities; • Purchasing new pollution control, energy conservation, or renewable energy generation equipment; and • Purchasing new on site digital manufacturing equipment. It does not include property that can be readily moved out of Indiana. This credit is administered by the IEDC at One North Capitol, Suite 700, Indianapolis, I N 46204. Visit www.iedc.in.gov or call 317- 233-3638 for more information. Also, see Income Tax Information Bulletin #95 available at www.in.gov/dor/files/reference/ib95.pdf. Submit a copy of the IEDC certificate verifying the amount of tax credit for the taxable year with the return, otherwise the credit will be denied. This credit must be claimed on Schedule I N -OCC. Enclose Schedule I N -OCC to claim this credit; otherwise, the credit will be denied.

# Indiana Research Expense Credit 822

Indiana has a research expense credit that is similar to the federal credit (Form 6765) for increasing research activities in Indiana. Compute the credit using Schedule IT-20R E C . If claiming a current year credit, make sure to check the corresponding box on Form IT-20S, question V . To claim a portion of a prior-year

# Indiana Research Expense Credit, please include Schedule IT-

20R E C from the prior-year's credit being utilized along with a schedule reflecting the utilization of the prior-year credit up to this point. Note. Current-year credits must be used first, then prior-year credits may be applied. Schedule IT-20R E C available at must be completed and enclosed with the return to claim this credit; otherwise, the credit will be denied. For more information, visit www.in.gov/dor. Filers claiming the research expense credit should keep documentation supporting the credit in a usable form. Important. Make sure to check Box V on Form IT-20S if claiming this credit. Individual Development Account Credit 823 A credit is available for contributions made to a community development corporation participating in an Individual Development Account (I D A ) program. The I D A program is designed to assist qualifying low-income residents in accumulating savings and building personal finance skills. The organization must have an approved program number from the Indiana Housing and Community Development Authority (IHCDA) for a contribution to qualify for preapproval. The credit is equal to 50% of the contribution, which must be between $100 and $50,000. Applications for the credit are filed through the IHCDA. To request more information about this credit, contact the Indiana Housing and Community Development Authority at 30 S. Meridian St., Suite 1000, Indianapolis, I N 46204 or 317-232-7777. Keep any approval certification or letter of credit assignment with your records as DOR can require you to provide this information at a later date. Industrial Recovery Credit 824 This credit is based on a taxpayer's qualified investment in a vacant industrial facility located in a designated industrial recovery site. If the Indiana Economic Development Corporation approves the application and the plan for rehabilitation, you are entitled to a credit based on the "qualified investment. " The minimum age for a facility to be eligible for this credit has been reduced from 20 years to 15 years. This credit is available to passthrough entities such as S corporations, partnerships, limited liability companies, etc. Note. Except for in situations described in the next sentence, a taxpayer is entitled to receive this credit only for a qualified investment made before Jan. 1, 2020. A taxpayer is entitled to receive a credit for a qualified investment made after Dec. 31, 2019, and before Jan. 1, 2030, if the taxpayer is awarded a credit under: • An application approved by the Indiana Economic Development Corporation (IEDC) before Jan. 1, 2020; or • An agreement entered into by the taxpayer and IEDC before Jan. 1, 2021. Important. Any unused credit existing before Jan. 1, 2020, is still eligible for carryforward for an unlimited number of years. For additional information regarding procedures for obtaining this credit, contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, I N 46204, call 317-232-8800, or visit their website at www.iedc.in.gov. Military Base Investment Cost Credit 826 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Military Base Recovery Credit 827 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed.

Mine Reclamation Credit 874 A credit is available for a qualified investment at a mine reclamation site. To be eligible for the credit, the credit must be approved by the IEDC. The credit for a taxable year cannot exceed 30% of the IEDC-approved qualified investment for the taxable year or $5,000,000, whichever is less. The taxpayer claiming this credit must provide a copy of the IEDC certification of the credit. However, if a taxpayer is claiming the credit as an owner of a pass-through entity, the taxpayer must have a Schedule I N K-1 reporting the claimed credit. The passthrough entity must provide and retain the certification by IEDC. The taxpayer can assign the credit to a lessee who remains subject to the same requirements. The assignment must be in writing. Also, any consideration may not exceed the value of the part of the credit assigned. Both parties must report the assignment on the state tax returns for the year of assignment. Neighborhood Assistance Credit 828 If a contribution is made to the Neighborhood Assistance Program or activities were engaged in to upgrade areas in Indiana, a credit for this assistance may be available. Effective July 1, 2014, contributions to organizations that provide services to individuals who are ex-offenders are also eligible for this credit. Contact the Indiana Housing and Community Development Authority, Neighborhood Assistance Program, 30 S. Meridian St., Suite 1000, Indianapolis, I N 46204, for more information. Call 317-232-7777 within Indianapolis or (800) 872-0371 outside of Indianapolis. New Employer Credit 850 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. New Rail Infrastructure Expenditures Tax Credit 883 Effective January 1, 2025, a taxpayer may claim a credit for new railroad infrastructure investments. The amount of the credit is equal to 50% of the taxpayer's qualified railroad expenditures, but may not exceed the lesser of: • 50% of the qualified new rail expenditures for each served customer project completed by the taxpayer in the taxable year, or • $500,000 per rail served customer project. A credit application may only be filed with the department after completion of the project. The department must evaluate a taxpayer's eligibility to be certified the credit based on a taxpayer submitting the number of miles of railroad track owned or leased in Indiana and a description and certification of the amount of the taxpayer's qualified new rail infrastructure expenditures. If a pass through entity does not have state tax liability to apply the credit, the credit flows through to the shareholders, partners or members on a pro rata basis. The credit may be assigned in writing. A taxpayer may make only one assignment and the assignee may not subsequently assign the credit. If the transferor of an assignment is a tax exempt entity (meaning a government agency or an organization that is recognized as exempt under section 501(c)(3) of the Internal Revenue Code) the transfer must be completed on or before the date that is one year after the close of the tax year for which the credit was certified. Enter Code 883 on Part A of Schedule IN-OCC for the year in which you are claiming the credit. Include the certification number provided by the department when you claim the credit. If necessary, complete Part B of Schedule IN-OCC to report credits claimed from a carryover or credits to be carried over. Railroad Expenditures Tax Credit 882 Effective Jan. 1, 2025, a taxpayer may claim a credit for qualified railroad expenditures. The amount of the credit is equal to 50% of the taxpayer's qualified railroad expenditures, but may not exceed the number of miles of Class II or Class III railroad track owned or leased by the taxpayer in Indiana at the close of the taxable year multiplied by $3,500. A credit application may only be filed with the department after completion of the project. The department must evaluate a taxpayer's eligibility to be certified the credit based on a taxpayer submitting the number of miles of railroad track owned or leased in Indiana and a description and certification of the amount of the taxpayer's qualified railroad expenditures. The credit may be assigned in writing. A taxpayer may make only one assignment and the assignee may not subsequently assign the credit. If the transferor of an assignment is a tax exempt entity (meaning a government agency or an organization that is recognized as exempt under section 501(c)(3) of the Internal Revenue Code) the transfer must be completed on or before the date that is one year after the close of the tax year for which the credit was certified. Enter Code 882 on Part A of Schedule IN-OCC for the year in which you are claiming the credit. Include the certification number provided by the department when you claim the credit. If necessary, complete Part B of Schedule IN-OCC to report credits claimed from a carryover or credits to be carried over. Redevelopment Tax Credit 863 Y ou may be eligible for a credit if you make a qualified investment for the redevelopment or rehabilitation of real property located within a qualified redevelopment site. This credit is administered by the Indiana Economic Development Corporation (IEDC), One North Capitol, Suite 700, Indianapolis, I N 46204. Visit the IEDC website at www.iedc.in.gov or call 317- 232-8800 for additional information. The approved credit must be reported on Schedule I N-OCC, found at www.in.gov/dor/tax-forms/individual/current. Make sure to enclose this schedule with your tax filing.

Riverboat Building Credit 832 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. School Scholarship Credit 849 A credit is available for contributions to school scholarship programs. A taxpayer that makes a qualifying contribution to a scholarship granting organization (SGO) is entitled to a credit against the state tax liability in the taxable year in which the contribution is made. The amount of a taxpayer's credit is equal to 50% of the amount of the contribution made to the SGO for a school scholarship program. In some cases, DOR may round the credit down to the nearest dollar if DOR receives information that the credit should be the amount as rounded down. The credit can be carried forward for nine years after the unused credit year. To qualify for the credit, the taxpayer must: • Make a contribution to a scholarship granting organization that is certified by the Department of Education under IC 20-51; • Make the contribution directly to the SGO; • Designate in writing to the SGO that the contribution is to be used solely for a school scholarship program or have written confirmation from the SGO that the contribution will be used solely for a school scholarship program. Although there are no limits on the size of a qualifying contribution to an SGO, the entire tax credit program has a limit of $18.5 million in credits per state fiscal year. Enclose Schedule I N -OCC to claim this credit; otherwise, the credit will be denied. Small Modular Nuclear Reactor Tax Credit 884 A credit is available for expenditures incurred in the manufacture of a small modular nuclear reactor. The credit is allowable for 20% of these expenditures incurred during the taxable year. The credit must be approved by the department prior to any credit claim. List this credit on Schedule IN-OCC, Part A using code 884 and listing the PIN provided by the department. If you are carrying forward any credit from a prior year or carrying forward a credit to next year, list the credit on Schedule IN-OCC, Part B. Any unused credit in excess of the current year tax liability can be carried forward indefinitely to future tax years. Venture Capital Investment Credit 835 A taxpayer that provides qualified investment capital to a qualified Indiana business may be eligible for this credit. Certification for this credit must be obtained from the Indiana Economic Development Corporation Development Finance Office, VCI Credit Program, One North Capitol, Suite 700, Indianapolis, I N 46204, telephone number 317-232-8827, or visit www.iedc.in.gov. Beginning with the 2020 tax year, this credit must be reported on Schedule I N -OCC, found at Make sure to enclose this schedule with your tax filing. If you are claiming this credit as an owner of a pass-through entity, such as an S corporation, limited liability company, etc., make sure to keep Schedule I N K-1 with your records as DOR can require you to provide this information. Also, see the "Restriction for Certain Tax Credits - Limited to One per Project" below. New reporting requirement. Enclose Schedule I N -OCC to claim this credit; otherwise, the credit will be denied Venture Capital Investment Credit - Qualified

# Indiana Investment Fund 868

A taxpayer who provides qualified investment capital (either debt or equity capital) to a qualified Indiana investment fund may be eligible for this credit. Note. Certification for this credit must be obtained from the

# Indiana Economic Development Corporation, Development

Finance Office, VCI Credit Program, One North Capitol, Suite 700, Indianapolis, I N 46204. This credit must be reported on Schedule I N -OCC, found at Make sure to enclose this schedule with your tax filing. Apply online through the IEDC's website at www.iedc.in.gov or call 317-232-8800 for more information. Restriction for Certain Tax Credits - Limited to One Per Project A taxpayer may not be granted more than one credit for the same project. The credits that are included are the alternative fuel vehicle manufacturer credit, community revitalization enhancement district credit, enterprise zone investment cost credit, Hoosier business investment credit, industrial recovery credit, and the venture capital investment credit. Reminders • Complete the S corporation's identification section. • List the two-digit code of the Indiana county; enter "00" (two zeroes) in the county box to indicate an out-of-state business operation. • S corporations filing on a fiscal-year basis must enter the tax year's beginning and ending dates. • Enclose Schedule PTET if you are electing or reporting PTET. • A composite return must be filed on Schedule Composite. • Enclose Schedule E-Apportionment of Income, if applicable. • Enclose copies of the first five pages of the U.S. Income Tax Return for an S Corporation, Form 1120S and Schedule M-3. • If the corporation's name has changed, check the appropriate box at the top of the return. Enclose with the return copies of the amended Articles of Incorporation filed with the Indiana Secretary of State.

Additional Information Shareholders' Liability and Filing Requirements A shareholder's share of profit or loss from an S corporation is included in the shareholder's calculation of federal A G I. It is generally subject to the same rules for arriving at Indiana A G I. Therefore, a shareholder's distributive share, before any modifications required by Indiana statutes, is the same ratio and amount as determined under I R C Section 1361 and its prescribed regulations. The shareholders include their shares of all S corporation income, whether distributed or undistributed, on separate Indiana income tax returns. Each shareholder's distributive share of the S corporation's income is adjusted by modifications provided for in IC 6-3-1-3.5(a) or (b). Individual Shareholders Residents. A resident shareholder reports the entire distributive share of S corporation income (loss) as adjusted, no matter where the S corporation's business is located or in which state(s) it does business. Form IT-40 (Indiana Individual Income Tax Return) should be completed by each individual shareholder. If a resident shareholder is credited with pass through entity tax or withholding, Schedule I N K-1 must be attached to support any claim for credit for these taxes. Nonresidents. The nonresident individual shareholder will be included on Schedule Composite and/or Schedule PTET and have amounts withheld or pass through entity tax credited on the distributive share of income. Schedule I N K-1 must be attached to the individual income tax return to support the pass-through of income, modifications, credits, pass through entity tax, and withholding. The shareholder must claim credit on Form IT- 40PNR by enclosing Schedule I N K-1 for amounts withheld by the S corporation and/or credited as pass through entity tax from the shareholder's distributive share of income. Important: • Full-year nonresident shareholders are exempt from filing an individual income tax return if: ο all Indiana income is reported on the composite return schedule and/or Schedule PTET, ο the shareholder did not file a Schedule I N-COMPA, and ο no county tax was withheld* on Schedule Composite, Column F . *If county tax was withheld, the nonresident must file Form IT- 40PNR. Nonresident shareholders with other Indiana-source income or who wish to benefit from other deductions or credits not available on a composite return should file Form IT-40PNR. • Part-year nonresident shareholders must file Form IT-40PNR to report: ο the total amount of income (loss) received while residing in Indiana; ο that part of Indiana source income received while a nonresident; and ο apportioned Indiana income (loss), as modified, received by a nonresident of Indiana. Note. Passive losses may not exceed the limits imposed by I R C Section 469. Also, losses may not exceed the shareholder's investment. See I R C Section 1367. Other Shareholders A resident trust or estate treats the entire distributive share of S corporation income (loss) as adjusted, no matter where the S corporation's business is located or in which state(s) it does business. Form IT-41 should be completed by each estate or trust. If a resident shareholder is credited with pass through entity tax or withholding, Schedule I N K-1 must be attached to support any claim for credit for these taxes. Other shareholders that are trusts or estates will be included on the Schedule Composite and/or Schedule PTET and have amounts withheld on the distributive share of income. Schedule I N K-1 will be used to document the withholding tax paid and pass through entity tax credited on behalf of the shareholder. The shareholder must claim credit for withholding and pass through entity tax by enclosing Schedule I N K-1 to report distributive shares of the S corporation income (loss) on Form IT-41. All distributions are fully taxable for income tax purposes. For adjusted gross income, taxable S corporation income includes pro rata Indiana modifications. However, losses may not exceed the limits imposed by I R C Sections 469 and 1367. Shareholders doing business both within and outside Indiana must also determine taxable income from Indiana sources by using the allocation and apportionment provisions contained in IC 6-3-2-2(b)-(h). See Schedule E (apportionment) for more information. Business income, including all S corporation income, apportioned to Indiana plus nonbusiness income allocated to Indiana (plus modifications required by IC 6-3-1- 3.5(a) for adjusted gross income tax) equals the shareholder's net taxable income for Indiana tax purposes. Basis of Stock in an S Corporation For Indiana income tax purposes, the basis of the shareholder's stock in an S corporation is the same as its basis for federal income tax purposes with the exception of an S corporation's basis in property subject to the historical rehabilitation credit. Shareholders of S corporations must maintain basis schedules and make them available to DOR upon request.

# Indiana S Corporation Income for Individual

Shareholders Example: Taxpayer A is a resident of Indiana and has a 50% stock interest in XYZ, Inc. XYZ is an Indiana S corporation doing business both within and outside Indiana. Taxpayer B is a nonresident of Indiana but also has a 50% stock interest in XYZ, Inc. XYZ's income from operations is $530,000, and its expenses are $500,000. Of these expenses, $35,000 is an expense for state income tax. Computations for XYZ, Inc.: XYZ computes its adjusted S corporation income as follows: Income from operations $530,000 Expenses -500,000 Add-back modifications + 35,000 S corporation income $65,000 Using the single-factor apportionment formula for periods beginning after Dec. 31, 2010, XYZ, Inc., determines its apportionment percentage as follows: Indiana sales/receipts $5000.00 Divide by everywhere sales/receipts /41667.00 Equals .1200 Multiply by 100 x 100 Equals Indiana apportionment percentage 12.00% Computations for Taxpayers A and B: Taxpayer A, as a resident of Indiana, must report his own entire share of S corporation income to Indiana regardless of whether the S corporation apportions its income. As a general rule, if Taxpayer A pays tax to another state (on a portion of S corporation income), Taxpayer A can take a credit on his individual return. Indiana adjusted S corporation income for Taxpayer A is computed as follows: S corporation income $65,000 Distributive share (50% x $65,000) Indiana adjusted distributive $32,500 share of income Taxpayer B, as a nonresident of Indiana, reports only her own share of S corporation income apportioned to Indiana. As a general rule, if Taxpayer B is required to pay tax to another state on a portion of her income from XYZ, Inc., Taxpayer B cannot take a credit on her Indiana return. She must claim it from her state of residence. Indiana adjusted S corporation income for Taxpayer B is computed as follows: S corporation income $65,000 Distributive share (50% x 65,000) $32,500 Multiply by apportionment percentage x 12% Apportioned Indiana distributive $3,900 share of income