INDIANA 2 0 2 3 IT-40 Full-Year Resident Individual Income Tax Booklet freefile.dor.in.gov FAST • FRIENDLY • FREE

WAIT! YOU MAY QUALIFY FOR FREE ONLINE TAX FILING! The majority of Indiana taxpayers file electronically every year. Consider the benefits of filing electronically:

• Faster Refund. Electronic filing reduces errors and expedites refund time – within 10 to 14 days (compared with 10 to 12 weeks for a paper return). • Fewer Errors. Up to 20 percent of paper-filed returns have errors, which can result in delays and possible penalty and/or interest for the taxpayer. Returns filed electronically, however, are 98 percent accurate. • Easier Filing. You won’t have to complete the many complicated forms in this booklet. Instead, you go online, answer some easy questions, and before you know it your taxes are complete. You may be eligible to file your taxes online for FREE with INfreefile. Go to www.in.gov/dor/individual-income-taxes/ infreefile to see if you qualify or learn more about INfreefile on page 4. SP 265 (R24 / 12-23)

IT-40 Booklet 2023 Page 3 Which Indiana Tax Form Should You File? Indiana has three different individual income tax returns. Read the following to find the right one for you to file. Form IT-40 for Full-Year Residents Use Form IT-40 if you (and your spouse, if married filing jointly) were full-year Indiana residents. Form IT-40PNR for Part-Year and Full-Year Nonresidents Use Form IT-40PNR if you (and your spouse, if married filing jointly): • Were Indiana residents for less than a full-year or not at all, or • Are filing jointly and one was a full-year Indiana resident and the other was not a full-year Indiana resident, and • Do not qualify to file Form IT-40RNR. Form IT-40RNR for Full-Year Residents of Reciprocal States Use Form IT-40RNR if you (and your spouse, if married filing jointly) were: • Full-year residents of Kentucky, Michigan, Ohio, Pennsylvania or Wisconsin, and • The only type of income from Indiana was from wage, tip, salary or other compensation.* *You are required to file Form IT-40PNR if you have any other kind of Indiana-source income. Note. If you have income that is being taxed by both Indiana and another state, you may have to file a tax return with the other state. Military Personnel See the instructions on page 7 to determine which form to file. Military personnel stationed in a combat zone should see the instructions on page 7 for extension of time to file procedures. 2023 Changes Update. Line 1 of Form IT-40 assumes conformity with the Internal Revenue Code of 1986, as amended and in effect on January 1, 2023. If the 2024 Indiana General Assembly does not conform to the most current changes to the Internal Revenue Code, you may have to amend your tax return at a later date to reflect any differences between Indiana and federal law. You may wish to periodically check DOR’s homepage at www.in.gov/dor for updates. Add-backs • A new add-back (151) has been added for certain modifications required to be applied against a net operating loss resulting from an excess business loss. See page 14 for more information. • A new add-back (153) has been added for certain modifications related to net operating losses permitted as a result of excess inclusion income. See page 14 for more information. • A new add-back (154) is available for specified research and experimental expenses required to be amortized for federal income tax purposes. See page 15 for more information. Credits • A new credit (874) is available for qualified investments at a mine reclamation site. See page 42 for more information. • Indiana’s Earned Income Tax Credit (EITC) has recoupled with the federal EITC. Indiana EITC is now 10% of federal EITC. Taxpayers may now claim up to three qualified children on Schedule IN-EIC. See page 31 for more information. • The Indiana’s CollegeChoice 529 Education Savings Plan Credit maximum credit amount has increased. In addition, contributions made after December 31, but no later than April 15, may claim a credit on either the current tax year or previous tax year returns. See page 39 for more information. • Credit for Taxes Paid to Other States. If you paid a pass through entity tax similar to Indiana’s Pass Through Entity Tax (PTET), you may claim a credit for those taxes in the same manner as if you had paid those taxes. See page 37 for further information. • Credit for Indiana Pass Through Entity Tax (PTET) Paid. If you are a taxpayer who is a partner in a partnership or a shareholder of an S corporation that has elected to pay PTET, the entity owner is entitled to a refundable credit. This credit is also available to owners of pass-through entities that pass along PTET from another entity. See page 30 for more information. Deductions • A new deduction (639) is available to allow the deduction for the portion of small employer health insurance premiums that is disallowed for federal purposes as a result of claiming the credit under IRC section 45R. See page 23 for more information. • A new deduction (641) is available to permit a current-year deduction for specified research and experimental expenses otherwise required to be amortized for federal tax purposes. See page 23 for more information. • A new deduction (642) is available for Career Scholarship Account (CSA) program grants received and used toward qualified expenses. See page 19 for more information. • The National Guard and Reserve Component Members Deduction (621) now exempts all military pay for members of a reserve component of the armed forces of the United States or the National Guard from the income tax for taxable years beginning in 2023 and thereafter. See page 22 for more information. Exemptions • Additional Dependent Child Exemption Change. If a taxpayer is claiming a child as a dependent for the first taxable year in which the exemption is allowed, the taxpayer is permitted to claim an amount of $3,000, instead of $1,500 for one tax year. See page 26 for more information. Miscellaneous • The Individual Income Tax Rate is lowered to 3.15% for tax year 2023. • Direct Debit of Estimated Payment. DOR will now accept direct debit of estimated payments with the electronic filing of your current year tax return.

IT-40 Booklet 2023 Page 4 Need Tax Forms or Information Bulletins? Use Your Personal Computer Visit our website and download the forms you need. Our address for tax forms is www.in.gov/dor/tax-forms. Information Bulletins are available at www.in.gov/dor/legal-resources/tax-library. Visit a District Office Some tax forms are available at district offices located throughout the state. These offices are open Monday - Friday, 8 a.m. to 4:30 p.m. local time. Visit www.in.gov/dor/contact-us/district-office-contact-info for a list of these offices, including addresses and telephone numbers. Need Help With Your Return? INTIME e-Services Portal Available INTIME, DOR’s e-services tax portal available at intime.dor.in.gov, provides the following functionalities for Individual 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, INTIME provides increased access and functionality for tax preparers. INTIME provides the following functionality for tax preparers: • Gain access to view and manage multiple customers under one login • Ability to file returns, make payments, and view file and pay history for clients • Request electronic power of attorney (ePOA) authorization to view customer accounts • View and respond to correspondence for clients We strongly encourage all taxpayers to make payments and file returns electronically whenever possible. INTIME allows customers to make estimated payments electronically with just a few clicks. Local Help You may be eligible to take advantage of the IRS Volunteer Return Preparation Program (VRPP). This program offers free tax return help to low income, elderly and special needs individuals. Volunteers will fill out federal and state forms for those who qualify. Call the IRS at 1-800-829-1040 to find the nearest VRPP location. Be sure to take your W-2s, 1099s and a copy of last year’s state and federal tax returns. Information Line Call the information line at 317-232-2240 to get the status of your refund, billing and payment plan information, a copy of your tax return, or prerecorded tax topics. If you wish to check for billing information, be sure to have a copy of your tax notice. The system will ask you to enter the tax identification number shown on the notice. To speak to a representative, please call during regular business hours, 8 a.m. to 4:30 p.m., Monday - Friday. Internet Address If you need help deciding which form to file, or need to get information bulletins or policy directives on specific topics, visit our website at www. in.gov/dor. Ready to File Your Return? Use an Electronic Filing Program A majority of Hoosier taxpayers use an electronic filing program to file their state and federal individual income tax returns every year. Electronic filing provides Indiana taxpayers the opportunity to file their federal and state tax returns immediately, and receive their Indiana refunds in about half the time it takes to process a paper return. It takes even less time if you use direct deposit, which deposits your refund directly into your bank account. Even if there is an amount due on either return, Indiana taxpayers can still file electronically and feel comfortable knowing that the returns were received by the IRS and the Indiana Department of Revenue (DOR). Use an electronic vendor or contact your tax preparer to see if he or she provides this service. INfreefile This tax season Indiana continues to offer a free tax filing service through the cooperation of the Free File Alliance. Eligible Indiana taxpayers can file both the federal and Indiana individual tax returns using highly interactive and easy-to-use web-based applications that speed both returns and refunds. You can choose from a list of multiple vendors that provide this free service. DOR estimates nearly 2 million Indiana taxpayers are eligible for this free service. See if you are eligible by visiting www.in.gov/dor/individual-income-taxes/infreefile. Our Website Our website offers tax filing options, a Spanish version of the IT-40 booklet with forms, downloadable blank forms and instructions, information bulletins, an online helpdesk, helpful email links and a calendar with filing due dates. Visit DOR’s website at www.in.gov/dor. Moving? Notify DOR if you move to a new address after filing your tax return, Change your address with us by doing one of the following: • Use DOR’s e-services portal, the Indiana Taxpayer Information Management Engine (INTIME), to change your address at intime. dor.in.gov. INTIME offers customers the ability to manage their tax account(s) in one convenient location, 24/7. You can change your address by creating an INTIME log on. Once logged in, go to the “All Actions” tab and locate the “Update Name and Addresses” panel and select the “Addresses” tab. An INTIME User Guide for Individual Income Tax Customers is available at www.in.gov/dor/files/intime-individual-guide.pdf to help you through the process. • Fax your request, including your Social Security number, old address, new address and signature, to 317-615-2608. • Mail the request, including your Social Security number, old address, new address and signature, to Indiana Department of Revenue, P.O. Box 6197, Indianapolis, IN 46206-6197. • Visit one of our District Offices (find locations here: www.in.gov/dor/ contact-us/district-office-contact-info) in person. Make sure to bring your Social Security number, old address, and new address with you.

IT-40 Booklet 2023 Page 5 Filing an Amended (Corrected) Tax Return If you need to amend (correct) your 2023 individual income tax return after you initially filed: • Prepare another IT-40 return that reflects all changes and check the “Amended” box on the front page. Failure to do so can delay processing. • Imclude a copy of all required schedules reflecting all changes and documentation. Failure to do so can delay processing. • File the amended return electronically, if possible. Note. All amounts previously paid should be reported as an estimated payment. All refunds previously received should not be reported on an amended filing. If you are filing an amended return for 2023 reporting additional tax and you previously received a refund, the department will issue either a notice of proposed assessment or demand for payment to request repayment of the refund plus interest and penalty. The Form IT-40 and supporting schedules are located at www.in.gov/ dor/tax-forms/2023-individual-income-tax-forms. For prior years, please see the instructions for that year. Annual Public Hearing In accordance with the Indiana Taxpayer Bill of Rights, DOR will conduct an annual public hearing in Indianapolis in June 2024. Event details will be listed at www.in.gov/dor/news-media-and-publications/ dor-public-events/annual-public-hearings. Please come and share feedback or comments about how DOR can better administer Indiana tax laws. If not able to attend, please submit feedback or comments in writing to: Indiana Department of Revenue, Commissioner’s Office, MS# 101, 100 N. Senate Avenue, Indianapolis, IN 46204. Our homepage provides access to forms, information bulletins and directives, tax publications, email, and various filing options. Visit www.in.gov/dor. Before You Begin Important. You must complete your federal tax return first. Filling in the Boxes – Please Use Ink If you are filling out the form by hand, please use black or blue ink and print your letters and numbers neatly within each box. If you do not have an entry for a particular line, leave it blank. Do not use dashes, zeros or other symbols to indicate that you have no entry for that line. Social Security Number Be sure to enter your full 9-digit Social Security number in the boxes at the top of the form. If filing a joint return, enter your Social Security number in the first set of boxes and your spouse’s full 9-digit Social Security number in the second set of boxes. An incorrect or missing Social Security number can increase your tax due, reduce your refund, or delay timely processing of your filing. Individual Taxpayer Identification Number (ITIN) If you already have an ITIN, enter it wherever your Social Security number is requested on your tax return. If you are in the process of applying for an ITIN, check the box located directly beneath the Social Security number area at the top of the form. For information on how to get an ITIN, contact the IRS at 1-800-829-3676 and request federal Form W-7, or find it online at www.irs.gov. Name and Suffix Please use all capital letters when entering your information. For example, Jim Smith Junior should be entered as JIM SMITH JR. Name. If your last name includes an apostrophe, do not use it. For example, enter O’Shea as OSHEA. If your name includes a hyphen, use it. For example, enter SMITH-JONES. Suffix. Enter the suffix associated with your name in the appropriate box. • Use JR for junior and SR for senior. • Numeric characters must be replaced by alphabetic Roman Numerals. For example, if your last name is Charles 3rd, do not use 3rd; instead, enter III in the suffix field. • Do not enter any titles or designations, such as M.D., Ph. D., RET., Minor or DEC’D. Married Filing Requirements • Married Filing Jointly If you filed your federal income tax return as married filing jointly, you also must file married filing jointly with Indiana. • Married Filing Separately If you file your federal income tax return as married filing separately, you must also file as married filing separately with Indiana. Enter both of your Social Security numbers in the boxes on the top of the form, and then check the box directly to the right of those boxes. Enter the name of the person filing the return on the top line, but do not enter the spouse’s name on the second name line. • Married Persons Who Live Apart Filing Status If you were not divorced or legally separated during the tax year you may have qualified for and filed as ‘head of household’ on your federal income tax return. If you did, do not check the married filing separately box. Also, do not enter either your spouse’s name or Social Security number. Military Address Overseas military addresses must contain the APO, FPO designation in the “city field” along with a two-character “state” abbreviation of AE, AP, or AA and the ZIP code. Place these two- and three-letter designations in the city name area. ZIP/Postal Code Enter your five- or nine-digit ZIP code (do not use a dash). For example, enter 46217 or 462174540. If filing with a foreign address, enter the associated postal code. Foreign Country Code Complete this area if the address you are using is located in a foreign country. Enter the 2-character foreign country code, which may be found online at www.in.gov/dor/legal-resources/tax-library/foreign- country-code-listing. County Information Enter the two-digit code numbers for the county(s) where you and your spouse, if filing jointly, lived and worked on Jan. 1, 2023. You can find these code numbers on the chart found on the back of Schedule CT-40. See the instructions beginning on page 49 for

IT-40 Booklet 2023 Page 6 more information, including the definitions of the county where you live and work, details for military personnel, retired individuals, homemakers, unemployed individuals, out-of-state filers, etc. Refund Check Address Your refund check will be issued in the name(s), address and Social Security number(s) shown on your tax return. It is very important that this information is correct and legible. Any wrong information will delay your refund. Rounding Required Each line on which an amount can be entered has “.00” already filled in. This is to let you know that rounding is required when completing your tax return. You must round your amounts to the nearest whole dollar. To do this, drop amounts of less than $0.50. Example. $432.49 rounds down to $432.00. Increase amounts of $0.50 or more to the next higher dollar. Example. $432.50 rounds up to $433.00. Losses or Negative Entries When reporting a loss or negative entry, use a negative sign. Example. Write a $125 loss as -125. Commas Do not use commas when entering amounts. For instance, express 1,000 as 1000. Enclosing Schedules, W-2s, Etc. Use only DOR-issued or DOR-permitted forms and schedules. Failure to use correct forms and schedules could result in disallowance of deductions or credits and will delay processing your return. You will find an enclosure sequence number in the upper right-hand corner of each schedule. Make sure to put your completed schedules in sequential order behind the IT-40 when assembling your tax return. Do not staple or paper clip your enclosures. If you have a schedule on which you’ve made no entry, do not enclose it unless you have completed information on the back of it. Also, enclose: • All W-2s, 1099s, Forms IN-MSID-A and IN K-1s on which Indiana state and/or county tax withholding amounts appear • All IN K-1s on which pass through entity tax amounts appear • All 1099Gs showing unemployment compensation • A check/money order, if applicable A note about your W-2s. It is important that your W-2 form is readable. The income and state and county tax amounts withheld are verified on every W-2 form that comes in with your tax return. We encourage you to enclose the best copy available when you file. Who Should File? You may need to file an Indiana income tax return if: • You lived in Indiana and received income, or • You lived outside Indiana and had any income from Indiana. Filing Status Requirement. If you and your spouse file a joint federal tax return, you must file a joint tax return with Indiana. If you and your spouse file separate federal tax returns, you must file separate tax returns with Indiana. Note. There are three types of Indiana tax returns available. The type you need to file is generally based on your residency status. Read the following to decide if you are a full-year resident, part-year resident, or nonresident of Indiana, and which type of return you should file. Full-Year Residents If you were a full-year resident of Indiana and your gross income (the total of all your income before deductions) was greater than certain exemptions*, you must file an Indiana tax return. Full-year residents must file Form IT-40, Indiana Full-Year Resident Individual Income Tax. You are a full-year Indiana resident if you maintain your legal residence in Indiana from Jan. 1 – Dec. 31 of the tax year. You do not have to be physically present in Indiana the entire year to be considered a full-year resident. Residents, including military personnel, who leave Indiana for a temporary stay, are considered residents during their absence. Retired persons spending part of the year in another state may still be full-year residents if: • They maintain their legal residence in Indiana and intend to return to Indiana during part of the taxable year • They retain their Indiana driver’s license • They retain their Indiana voting rights • They claim a homestead deduction on their Indiana home for property tax purposes * To figure your exemptions for filing requirement purposes, Indiana allows a $1,000 exemption for you and a $1,000 exemption for your spouse (if married filing jointly). You also get a $1,000 exemption for each dependent you are eligible to claim. See instructions beginning on page 24 for additional information concerning how to figure your dependents. If your gross income is less than your total exemptions figured above, you are not required to file. However, you may want to file a return to get a refund of any state and/or county tax withheld by your employer, or other refundable credits, such as an earned income credit or estimated tax payment. Part-Year Residents and Full-Year Nonresidents If you were a part-year resident and received income while you lived in Indiana, you must file Indiana Form IT-40PNR, Part-Year Resident or Nonresident Individual Income Tax Return. If you were a legal resident of another state(s) (exception: see next paragraph) and had income from Indiana (except certain interest, dividends, or retirement income), you must file Form IT-40PNR.

IT-40 Booklet 2023 Page 7 Full-Year Residents of Kentucky, Michigan, Ohio, Pennsylvania or Wisconsin If you were a full-year resident of Kentucky, Michigan, Ohio, Pennsylvania or Wisconsin, and your only income from Indiana was from wages, salaries, tips or commissions, then you need to file Form IT-40RNR, Indiana Reciprocal Nonresident Individual Income Tax Return. Deceased Taxpayers If an individual died during 2023, or died after Dec. 31, 2023, but before filing his/her tax return, the executor, administrator or surviving spouse must file a tax return for the individual if: • The deceased was under the age of 65 and had gross income more than $1,000 • The deceased was age 65 or older and had gross income more than $2,000, or • The deceased was a nonresident and had gross income from Indiana. Be sure to enter the month and day of death for the taxpayer or spouse in the appropriate box located on Schedule 7. For example, a date of death of Jan. 9, 2023, would be entered as 01/09/2023. Note. The date of death should not be entered here if the individual died after Dec. 31, 2023, but before filing the tax return. The date of death information will be shown on the individual’s 2024 tax return. Signing the Deceased Individual’s Tax Return If a joint return is filed by the surviving spouse, the surviving spouse should sign his or her own name and after the signature write: “Filing as Surviving Spouse.” An executor or administrator appointed to the deceased’s estate must file and sign the return (even if this isn’t the final return), indicating their relationship after their signature (e.g. administrator). If there is no executor, or if an administrator has not been appointed, the person filing the return should sign and give their relationship to the deceased (e.g. “John Doe, nephew”). Only one tax return should be filed on behalf of the deceased. Note. DOR may ask for a copy of the death certificate, so please keep a copy with your records. Refund Check for a Deceased Individual If you (the surviving spouse, administrator, executor or other) have received a refund check and cannot cash it, contact the State Comptroller at www.in.gov/comptroller/contact-us to get a widow’s and distributee’s affidavit (POA-20) or a reissuance of refund (IN- 1310). Send the completed form, the refund check and a copy of the death certificate to the State Comptroller so a refund check can be issued to you. Military Personnel — Residency If you were an Indiana resident when you enlisted, you remain an Indiana resident no matter where you are stationed. You must report all your income to Indiana on Form IT-40. If you changed your legal residence (military home of record) during the tax year, you are a part-year resident and should file Form IT-40PNR. You must also enclose a copy of Military Form DD-2058 with the tax return. As an Indiana part-year resident you will be taxed on the income you earned while you were a resident of Indiana, plus any income from Indiana sources. If you are stationed in Indiana and you are a resident of another state, you won’t need to file with Indiana unless you have non-military income from Indiana sources. Example. Annie, who is a Kansas resident, is stationed in Indiana. She earned $1,300 from her Indiana part-time job. She will need to report that income to Indiana on Form IT-40PNR. If you are a full-year Indiana resident in the military, your spouse is a legal resident of another state and you filed a joint federal return, you will need to file Form IT-40PNR. Important. Refer to the instructions on page 49 for an explanation of county of residence for military personnel. When Should You File? Your tax return is due April 15, 2024. If you file after this date and owe tax, you will owe interest on the unpaid amount and you may owe penalty, too. See page 11 for more information. Fiscal year tax returns are due by the fifteenth (15) day of the fourth (4th) month after the close of the fiscal year. You must complete the fiscal year filing period information at the top of the Form IT-40. Extension of Time to File — What if You Can’t File on Time? You must get an extension of time to file if you: • Are required to file, and • You cannot file your tax return by the April 15, 2024, due date. Whether you owe additional tax, are due a refund, or are breaking even, you still need to get an extension if filing after April 15, 2024. Note. Indiana’s Application for Extension of Time to File, Form IT-9, extends the filing date to Nov. 15, 2024. If You Owe… Option 1. File Indiana’s Application for Extension of Time to File, Form IT-9. This must be filed by April 15, 2024, for the extension request to be valid. Note. You may file Indiana’s Application for Extension of Time to File online if you make a payment with it by April 15, 2024. Pay electronically using DOR’s e-services portal, the Indiana Taxpayer Information Management Engine (INTIME), by visiting intime.dor. in.gov. INTIME offers customers the ability to manage their accounts in one convenient location, 24/7. Option 2. Filing for a federal application for extension of time to file with the IRS will automatically provide for a state extension of time to file. You must file your state tax return by Nov. 15, 2024, paying any balance due with that filing.

IT-40 Booklet 2023 Page 8 While interest is due on any amount paid after the original April 15 due date, penalty will be waived if both of the following conditions are met: • The remaining balance due is paid in full by Nov. 15, 2024, and • You paid at least 90% of the tax expected to be owed by the original April 15 due date. If You Don’t Owe… You’ll need to file for an extension if: • You are due a refund, or • You don’t expect to owe any tax when filing your tax return, and • You are unable to file your return by April 15, 2024. There are two ways to accomplish this: • If you have a federal extension (you filed Form 4868, or made an extension payment via an electronic filing method), you automatically have an extension with Indiana and do not have to file for a separate state extension (Form IT-9). • If you do not have a federal extension, file Form IT-9 by April 15, 2024. Extension Filing Deadline Both state Form IT-9 and federal Form 4868 extend your state filing time to Nov. 15, 2024. Will You Owe Penalty and/or Interest? Penalty will not be owed if you have: • Paid 90% of the tax you expect to owe by April 15, 2024, • Filed your tax return by Nov. 15, 2024, and • Paid any remaining amount due (including interest) with that filing. Interest is owed on all amounts paid after April 15, 2024. See page 11 for instructions on how to figure interest. Indiana’s Extension of Time to File, Form IT-9 Pay electronically using DOR’s e-services portal, the Indiana Taxpayer Information Management Engine (INTIME), by visiting intime.dor. in.gov. INTIME offers customers the ability to manage their accounts in one convenient location, 24/7. Alternatively, you may access Form IT-9 online at www.in.gov/dor/tax-forms/2023-individual-income- tax-forms. You may file Indiana’s Application for Extension of Time to File online if you make a payment with it by April 15, 2024. Where to Report Your Extension Payment Add your state extension payment to any estimated tax paid. Report the total on Schedule 5, line 4. Military personnel on duty outside of the United States and Puerto Rico on the filing due date are allowed an automatic 60 day extension of time to file. A statement must be enclosed with the return verifying that you were outside of the United States or Puerto Rico on April 15, 2024. Military personnel in a presidentially declared combat zone have an automatic extension of 180 days after they leave the combat zone. In addition, if they are hospitalized outside the United States because of such service, the 180-day extension period begins after being released from the hospital. The spouse of such service member must use the same method of filing for both federal and Indiana (e.g. single or joint). When filing the return, write “Combat Zone” across the top of the form (above your Social Security number). Form IT-40: Line-by-line Instructions Important. You must complete your federal income tax return, Form 1040/1040-SR, before starting your Indiana income tax return. Line numbers from your federal income tax return are referenced in many of the following instructions. While every effort has been made to make the instructions as clear as possible, sometimes the line numbers change on the federal income tax return after the Indiana forms are finalized. Please contact us if you are unsure as to whether or not you are looking at the correct line on your federal income tax return (see page 4 of this booklet for contact information). When Not to Fill In a Line If you do not have an entry for a particular line, leave it blank. Do not use dashes, zeros or other symbols to indicate that you have no entry for that line. Line 1 – Federal Adjusted Gross Income Enter the adjusted gross income from your federal Form 1040/1040- SR, line 11. If you were not required to file a federal return, complete a “sample” federal return and report the amount you would have shown on your federal return if you had been required to file. When reporting a loss or negative entry, use a negative sign. Example. Write a $125 loss as -125. Line 2 – Add-Backs Enter on this line any add-backs from Schedule 1: Add-Backs. Instructions for Schedule 1 begin on page 12. Make sure to enclose Schedule 1 when filing. Line 4 – Deductions Enter on this line any deductions from Schedule 2: Deductions. Instructions for Schedule 2 begin on page 16. Make sure to enclose Schedule 2 when filing. Line 6 – Exemptions Enter any exemptions from Schedule 3: Exemptions on this line. Instructions for Schedule 3 begin on page 24. Make sure to enclose Schedule 3 when filing. Line 9 – County Tax Complete Schedule CT-40 to figure your county tax. Instructions for Schedule CT-40 begin on page 49. Line 10 – Other Taxes Enter any other taxes from Schedule 4: Other Taxes on this line. Instructions for Schedule 4 begin on page 28. Make sure to enclose Schedule 4 when filing. Line 12 – Credits Enter your credits from Schedule 5: Credits on this line. Instructions for Schedule 5 begin on page 29. Make sure to enclose Schedule 5 when filing. Line 13 – Offset Credits Enter the total of any offset credits reported on Schedule 6: Offset Credits on this line. Instructions for Schedule 6 begin on page 36.

IT-40 Booklet 2023 Page 9 Make sure to enclose Schedule 6 when filing. Line 17 – Donation Check-Offs Enter on this line the total of any donations made on Schedule IN- DONATE. Make sure to enclose Schedule IN-DONATE, which is located at the bottom of Schedule 5: Credits, when filing. See page 35 for more information. Line 19 – Amount to be Applied as a 2024 Estimated Tax Installment Payment You should pay estimated tax during the 2024 tax year if: • You have income that will not be subject to Indiana tax withholding, or • You think the amount withheld will not be enough to pay your tax liability, and • You expect to owe more than $1,000 when you file your tax return. The simplest and most efficient way to pay quarterly estimated taxes is by using INTIME at intime.dor.in.gov. INTIME offers a quick, safe and secure way to submit estimated payments, while providing the option to schedule payments and view payment history. By using this method, customers receive a confirmation number immediately without having to wait for mail to arrive or checks to clear. INTIME also provides the option to schedule all four estimated payments, up to a year in advance, to avoid penalties and never miss a deadline again. Any awaiting payment(s) in INTIME will remain “pending” until the scheduled payment date enabling customers to make changes or cancel at any time leading up to that date. Instructions on how to make estimated payments using INTIME are available in the INTIME User Guide for Individual Income Tax Customers at www.in.gov/dor/files/intime-individual-guide.pdf. Beginning in 2024, if you file your individual return electronically, DOR will accept direct debit of up to four estimated payments. Alternatively, you may visit our website at www.in.gov/dor/tax- forms/2023-individual-income-tax-forms to get Form ES-40. Use the worksheet on Form ES-40 to see how much you will owe. Then, if you have an overpayment showing on line 18 of your tax return, you can have some or all of the overpayment applied to next year’s estimated tax account. To do so, enter any portion of the overpayment: • On line a, if you want to apply an amount to offset estimated county tax due (from Form ES-40 worksheet, line K). Also, enter the 2-digit county code from line K; and/or • On line b, if your spouse lived in a different county than you did on Jan. 1, 2024, and you want to apply an amount to offset your spouse’s estimated county tax due (from Form ES-40 worksheet, line L). Also, enter the 2-digit county code from line L; and/or • On line c, if you want to apply an amount to offset your estimated state tax due (from Form ES-40 worksheet, line J). Example. Mark and Megan have a $420 overpayment, and want to apply $300 of it to their 2024 estimated tax account. Their worksheet from Form ES-40 has the following breakdown: • Line I (each installment payment) is $300; • Line J (portion that represents state tax due) is $270; and • Line K (portion that represents county tax due) is $30. They will enter $30 on line 19a (along with their 2-digit county code), $270 on line 19c, and the $300 total amount to be applied will be entered on line 19d. They will get a $120 refund ($420 overpayment minus $300 applied to their 2024 estimated tax account). Example. Stu wants to pay $500 in estimated tax for each installment period. He has a $30 overpayment on his tax return. He chooses to enter the full $30 overpayment on line 19c (Indiana adjusted gross income tax amount), and carries it to line 19d. (He may pay the $470 additional amount by using INTIME to make a secure electronic payment, or by printing Form ES-40 and filing it along with a check or money order.) Important. Estimated tax installment payments made for the 2024 tax year are due by: • April 15, 2024 (1st installment) • June 17, 2024 (2nd installment) • Sept. 16, 2024 (3rd installment) • Jan. 15, 2025 (4th installment) Any installment payment amount entered on line 19d will be considered to be paid on the day your tax return is filed (postmarked). For instance, an installment payment shown on a return filed on: April 15, 2024, will be considered to be a 2024 first installment payment; June 3, 2024, will be considered to be a 2024 second installment payment; and July 22, 2024, will be considered to be a 2024 third installment payment. Note. You may complete and mail the ES-40, Estimated Tax Payment form, along with your payment to DOR’s return address on the form. Estimated payments can also be made online with an electronic bank payment (ACH/e-check) or Visa, MasterCard and Discover debit or credit cards by using DOR’s e-services portal, the Indiana Taxpayer Information Management Engine (INTIME), at intime.dor.in.gov. See line 26 instructions on page 11 for details about payment options. See Income Tax Information Bulletin #3 at www.in.gov/dor/files/ reference/ib03.pdf for additional information about estimated taxes. Line 20 – Penalty for Underpayment of Estimated Tax You might owe a penalty for the underpayment of estimated tax if you did not have taxes withheld from your income and/or you did not pay enough estimated tax throughout the year. In fact, not properly paying estimated tax is one of the most common errors made in filing Indiana tax returns. Generally, if you owe $1,000 or more in state and county tax for the year that’s not covered by withholding taxes, you need to be making estimated tax payments. You might owe this penalty if: • The total of your credits, including timely made estimated tax payments, is less than 90% of this year’s tax due or 100% of last year’s tax due, ** or • You underpaid the minimum amount due for one or more of the installment periods. If either of these cases apply to you, you must complete Schedule IT-2210 or IT-2210A to see if you owe a penalty or if you meet an exception.

IT-40 Booklet 2023 Page 10 • If you owe this penalty, complete Schedule IT-2210 or IT-2210A and write the penalty amount on Form IT-40, line 20. • If you meet an exception, complete Schedule IT-2210 or IT-2210A to show which exception was met. Include the completed form with your submission. *You must have timely paid 100% of lines 8 and 9 of your 2022 IT-40 or IT-40PNR. Note: If last year’s Federal adjusted gross income was more than $150,000 ($75,000 for married filing separately), you must pay 110% of last year’s tax (instead of 100%) to meet this exception. **Farmers and fishermen should see the special instructions on page 10. Important. DOR will compute and assess the underpayment penalty where appropriate based on filing history and tax due. Should You Use Schedule IT-2210 or Schedule IT-2210A? Schedule IT-2210 should be used by individuals who receive income (not subject to withholding tax) on a fairly even basis throughout the year. This schedule will help determine whether a penalty is due, or whether an exception to the penalty has been met. Example. Jim and Sarah together received $4,500 in pension income each month. Since their income is received on a fairly even basis, they’ll use Schedule IT-2210 to figure their penalty or exception to the penalty. Farmers and fishermen have special filing considerations. If at least two-thirds of your gross income is from farming or fishing, complete Schedule IT-2210, using the Section D Short Method. Schedule IT-2210A may be used by individuals who receive income (not subject to withholding tax) unevenly during the year. Also use this form if you had substantial changes in withholding during the year. See Income Tax Information Bulletin #3 available at www.in.gov/ dor/files/reference/ib03.pdf for further information. This schedule will help determine whether a penalty is due, or whether an exception to the penalty has been met. Example. Bill’s income is from selling fireworks in June and July. He will want to figure any penalty due on Schedule IT-2210A, which may exempt him from having had to pay estimated tax on the April 15, 2023, first installment due date. Example. Rachael received a sizable lump sum distribution in December of 2023. She figured how much estimated tax was due, and paid it in full by the Jan. 16, 2024, fourth period installment due date. By completing Schedule IT-2210A, she shows she owes no penalty for the first three installment periods, and that a proper payment was made for the fourth installment period. She will owe no penalty. Farmers and Fishermen. Special options are available if more than two-thirds of your gross income for 2022 and/or 2023 was from farming or fishing. Option 1. Pay your estimated tax in one payment on or before Jan. 16, 2024, and file your tax return by April 15, 2024; or Option 2. Make no estimated tax payment and file your tax return and pay all the tax due by March 1, 2024. Example. More than two-thirds of Henry’s gross income is from farming. He should complete Schedule IT-2210. Henry will be able to use the Section D Short Method to figure his penalty or to show he meets an exception to owing a penalty. Example. Henry had two-thirds of his income for 2021 from farming. In 2022 and 2023, Henry had less than two-thirds of his income from farming or fishing. Henry can use the special option for farmers or fisherman for 2022 because two-thirds of his previous-year income (2021) was from farming or fishing. Henry cannot use the special option for 2023 because less than two-thirds of his income for both 2022 and 2023 was from farming or fishing. Visit our website at www.in.gov/dor/tax-forms/2023-individual- income-tax-forms to get Schedule IT-2210 or Schedule IT-2210A. Line 20a Enter Code A if you are computing your penalty using Form IT-2210A. Enter Code F if you are reporting estimated tax as a farmer or a fisherman. Line 21 – Refund You have a refund if line 18 is greater than the combined amounts entered on lines 19d and 20. Important. If the combination of line 19d plus line 20 is greater than the amount on line 18, you must make an adjustment. The estimated tax carryover amount on line 19d is limited; it cannot be greater than the remainder of line 18 minus line 20. See the second example about Stu under the Line 19 instructions on page 9. A Note About Refund Offsets Indiana law requires that money you owe to the state, its agencies, and certain federal agencies, be deducted from your refund or credit before a refund is issued. This includes money owed for past-due taxes, student loans, child support, food stamps or an IRS levy. If DOR applies your refund to any of these debts, you will receive a letter explaining the situation. When to Expect Your Refund Generally, 10 to 14 business days is the average wait for a refund if the tax return is electronically filed; it can take up to 12 weeks for the refund to be issued if you mail a paper tax return. A refund may take longer under certain circumstances. The most common incidents are when businesses supply withholding statements (such as W-2, 1099-R, Schedule IN K-1, etc.) late and when the return reports a Schedule C loss. Where’s Your Refund? There are several ways to check the status of your refund. You will need to know the exact amount of your refund, and a Social Security number entered on your tax return. Then, do one of the following: • Go to www.in.gov/dor/individual-income-taxes/check-the-status- of-your-refund and click Check the Status of Your Refund. • Call 317-232-2240 for automated refund information; to speak to a representative, please call during regular business hours, 8 a.m. to 4:30 p.m., Monday - Friday. • Go to INTIME at intime.dor.in.gov and click “Where’s my refund?”

IT-40 Booklet 2023 Page 11 A refund directly deposited to your bank account may be listed on your bank statement as a credit, deposit, etc. If you have received information from DOR that your refund has been issued, and you are not sure if it has been deposited in your bank account, call the ACH Section of your bank or financial institution for clarification. Important. If we are unable to deposit your refund to the listed account (incorrect/incomplete account numbers; account closed; refund to go to an account outside the United States; etc.), DOR will mail a paper check to the address on the front of the tax form. Note. A refund deposited directly to your Hoosier Works MasterCard account will appear on your monthly statement. Statute of Limitations for Refund Claims There is a statute of limitations when filing for a refund of overpaid taxes for tax year 2023. In general, a claim for refund must be made by April 15, 2027 (Nov. 15, 2027 if filing under extension). The claim for refund is considered to be made on the day your tax return is postmarked. If you file your 2023 tax return after the statute of limitations has expired, no refund will be issued. Line 22 – Direct Deposit You may choose to have your refund deposited in your checking, savings or Hoosier Works Master Card account. If you want your refund directed into your checking or savings account, complete lines 22 a, b, c and d. Caution. If you choose this option, make sure to verify the account information after you have entered it. This will help ensure your refund is deposited into your desired account. The routing number is nine digits, with the first two digits of the number beginning with 01 through 12 or 21 through 32. Do not use a deposit slip to verify the number because it may have internal codes as part of the actual routing number. The account number can be up to 17 digits. Omit any hyphens, accents and special symbols. Enter the number from left to right and leave any unused boxes blank. Check the appropriate box for the type of account you are making your deposit to: either a checking account or savings account. To comply with banking rules, you must place an X in the box on line d if your refund is going to an account outside the United States. If you check the box, we will mail you a paper check. If you currently have a Hoosier Works MasterCard and wish to have your refund directly deposited in your account, enter your 12-digit account number on line 22b, where it says “Account Number” (do not write anything on line 22a “Routing Number”). You can find your 12-digit account number in the upper right-hand corner of your account monthly statement. Note. DO NOT use your MasterCard 16-digit number. Make sure to check the “Hoosier Works MC” box on line 22c. For more information on direct deposit, please see “Where’s Your Refund?” on page 10. Line 23 If line 21 is less than zero, you have an amount due. Enter here as a positive number and skip to line 24. OR If line 15 is greater than line 14, complete the following steps: Subtract line 14 from line 15 and enter the total here... A___________ Enter any amount from line 20.........................................B___________ Add lines A + B. Enter total here and on line 23............C___________ Line 24 – Penalty You may owe a penalty if your tax return is filed after the April 15, 2024, due date and you have an amount due. Penalty is 10% of the amount due (line 23 minus line 20) or $5, whichever is greater. Exception. No penalty will be due if you have: • An extension of time to file, • Are filing and paying the remaining tax due by the extended filing due date, and • Have prepaid at least 90% of the amount due by April 15, 2024. Line 25 – Interest You will owe interest (even if you have an extension of time to file) if your tax return is filed after the April 15, 2024, due date and you have an amount due. Interest should be figured on the sum of line 23 minus line 20. Contact DOR at 317-232-2240 or visit our website at www. in.gov/dor/files/reference/dn03.pdf to get Departmental Notice #3 for the current interest rate. Line 26 – Amount Due – Payment Options There are several ways to pay the amount you owe. Electronic payments can be made via DOR’s e-service portal, the Indiana Taxpayer Information Management Engine (INTIME), at intime.dor. in.gov. INTIME offers customers the ability to manage their accounts in one convenient location, 24/7. Accepted forms of payment via INTIME include electronic bank payment (ACH/e-check), Visa, MasterCard and Discover debit or credit cards. No fees are assessed for electronic bank payments. Fees apply to payments made with credit or debit cards. You do not need to logon to INTIME to make payments. Simply select the “Make a Payment” option on the page. An INTIME User Guide for Individual Income Tax Customers is available at www.in.gov/dor/files/ intime-individual-guide.pdf to help you through the process. Another option is to mail your payment to: Indiana Department of Revenue P.O. Box 7224 Indianapolis, IN 46207-7224 You may pay in person at one of DOR’s district offices with cash, but with the exact amount only. Other in-person options include paying with a money order, cashier’s check or personal check made payable to DOR. Note. All payments to DOR must be made with U.S. Funds. Payment plan option. If you cannot pay the full amount due at the time you file, you may be eligible to set up a payment plan online using DOR’s e-services portal, the Indiana Taxpayer Information Management Engine (INTIME), at intime.dor.in.gov. INTIME offers customers the ability to manage their tax account(s) in one convenient

IT-40 Booklet 2023 Page 12 location, 24/7. Create an INTIME logon to manage your account, make payments, establish payment plans, and more. After your return finishes processing, a payment plan can be established. Important. If using the payment plan option, penalty and interest will be due on all amounts paid after the April 15, 2024, due date. If you have questions, contact DOR in one of three ways: • Use the secure messaging feature in the Indiana Taxpayer Information Management Engine (INTIME). If you are not registered, create an online account at intime.dor.in.gov. Select “New to INTIME? Sign up” and follow instructions to complete the process. You will need your taxpayer ID (FEIN, SSN, etc.) and the unique Letter ID, printed in the upper-right hand corner of this letter. Once logged in, select “Respond to a letter, notice, or bill” under the “All Actions” menu. • Call DOR Customer Service at 317-232-2240, Monday through Friday, 8 a.m. - 4:30 p.m. EST. • Correspond with DOR via mail using this address: Indiana Department of Revenue 100 N. Senate Ave. Indianapolis, IN 46204-2253 Returned Checks and Other Types of Payments If you make a tax payment with a check, credit card, debit card, electronic funds transfer, or any other instrument in payment by any commercially allowable means, and DOR is unable to obtain payment for its full amount when it is presented for payment through normal banking channels, a $35 penalty will be assessed. The assessed amount will be due immediately upon receipt of the tax due notice and must be paid by certified check, bank draft or money order. Note. Any permits and/or licenses issued by DOR may be revoked if the assessed amount is not paid immediately. Signatures and Signing Dates First, read the Authorization area on Schedule 7. Then, sign and date the tax return. If this is a jointly filed tax return, both you and your spouse must sign and date it. Make sure to enclose the completed Schedule 7 when filing. Taxpayer Advocate As prescribed by the Taxpayer Bill of Rights, DOR has an appointed Taxpayer Advocate whose purpose is to facilitate the resolution of taxpayer complaints and complex tax issues. If you have a complex tax issue, you must first pursue resolution through normal channels, such as contacting the customer service division at 317-232-2240. If you are still unable to resolve your tax issue, or a tax assessment places an undue hardship on you, you may receive assistance from the Office of the Taxpayer Advocate. For more information, and to get required schedules if filing for an offer in compromise or a hardship case, visit our website at: www. in.gov/dor/contact-us/tao. You may also contact the Office of the Taxpayer Advocate directly at taxadvocate@dor.in.gov, or by telephone at 317-232-4692. Submit supporting information and documents to: Indiana Department of Revenue, Office of the Taxpayer Advocate, P.O. Box 6155, Indianapolis, IN 46206-6155. Where to Mail Your Tax Return If you are enclosing a payment, please mail your tax return with all enclosures to: Indiana Department of Revenue P.O. Box 7224 Indianapolis, IN 46207-7224 For all other filings, please mail your tax return with all enclosures to: Indiana Department of Revenue P.O. Box 40 Indianapolis, IN 46206-0040 Schedule 1: Add-Backs Some amounts reported on your federal tax return may require different treatment for Indiana income tax purposes. Listed in this area are those items that may need to be added back on your Indiana tax return. Please review the list carefully. When reporting these add-backs, maintain with your records the corresponding federal tax forms and schedules as DOR can require you to provide them at a later date. Important Information About Possible Year-End Federal Legislation This publication was finalized before all year-end federal legislative changes were complete. Therefore, some of these add-backs may need to be adjusted. You may wish to periodically check DOR’s homepage at www.in.gov/dor for updates about any impact of late federal legislation. Treatment of Previously Discontinued Add-Back Several discontinued add-backs were created as a result of timing differences between federal and Indiana allowable expenses. See Certain Discontinued Add-Backs: How and When to Report a Final Catch-Up Modification on page 15 for information about these add-backs. Line 1 – Tax Add-Back If you did not complete Federal Schedules C, E or F, which include sole proprietorship income, farm income, rental, partnership, S corporation, and trust and estate income (or loss), then do not complete this line. On those schedules you are allowed to claim a deduction for taxes paid which are: • based on, or • measured by income, and • levied at a state level by any state in the United States. If you claimed this kind of deduction on any of these schedules, then you must add it back to your Indiana income. Do not add back property taxes on this line. State-level pass through entity taxes that are deducted in determining your federal adjusted gross income should be added back on this line. If you subsequently receive a refund of those taxes, report the refund on this line as a deduction. Schedule 1: Add-Backs

IT-40 Booklet 2023 Page 13 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: 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 wagering taxes in 2023. Individual owns 10% of Casino X. Individual’s share of Casino X’s income taxes is $1,000,000. Instead of individual adding back the full $1,000,000, Individual will add back $375,000. Note. Income, losses and/or expenses from other schedules and forms may flow through to federal Schedules C, E and F. For example, partnership income from federal Schedule K-1 (Form 1065) 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. Line 2 – Net Operating Loss Add-Back Any net operating loss (NOL) deduction reported on line 8 of your federal Schedule 1 must be added back on this line. Write the amount of the net operating loss as a positive figure. (You may be eligible to claim an Indiana net operating loss deduction on Schedule 2, under line 9.) Note. Leave this line blank if you did not report a net operating loss deduction on line 8a of your federal Schedule 1. Line 3 – OOS Municipal Obligation Interest Add-Back Interest earned from a direct obligation of a state or political subdivision other than Indiana (out of state, or OOS) is taxable by Indiana if the obligation is acquired after Dec. 31, 2011. Interest earned from obligations held or acquired before Jan. 1, 2012, is not subject to Indiana income tax and should not be reported as an add-back. Note. Interest earned from obligations of Puerto Rico, Guam, Virgin Islands, American Samoa, or Northern Mariana is not included in federal gross income and is exempt under federal law. There is no add- back for interest earned on these obligations. For more information about this add-back, see Income Tax Information Bulletin #19 at www.in.gov/dor/files/reference/ib19.pdf. Line 4 – Bonus Depreciation Add-Back You must make an exception for any bonus depreciation deduction used for property placed in service after Sept. 11, 2001. Bonus depreciation is the additional first-year special depreciation deduction allowed under Section 168(k) of the Internal Revenue Code (IRC). Figure the net income (or loss) that would have been included in federal adjusted gross income had the bonus depreciation method not been used. Then, enter the difference, which may be a positive or negative amount, on line 4. Example. Mack used the bonus depreciation method for federal income tax purposes. After refiguring the depreciation without using the bonus method, he has to add back $1,500 on his Indiana tax return. Note. After making an initial adjustment for bonus depreciation you will need to refigure the amount of depreciation available for state tax purposes for subsequent years. Example. Ann made an initial adjustment for bonus depreciation on last year’s Indiana tax return. This year she figures she is entitled to a $150 additional depreciation amount for state tax purposes. She should enter that amount as a negative entry, or -150, on line 4. Special rules may apply if the bonus depreciation is taken against property acquired in a like-kind exchange or acquired in a taxable year in which you have an excess business loss. See Income Tax Information Bulletin #118 at www.in.gov/dor/files/reference/ib118.pdf for additional information. Line 5 – Section 179 Expense Add-Back You may have figured an IRC Section 179 expense using a ceiling of more than $25,000 for federal tax purposes. Indiana allows you to figure IRC Section 179 expense using a ceiling of no more than $25,000. If you figured IRC Section 179 expense using a ceiling amount of more than $25,000, you will need to add back the difference between it and $25,000 on line 5. Special rules may apply if the bonus depreciation is taken against property acquired in a like-kind exchange or acquired in a taxable year in which you have an excess business loss. See Income Tax Information Bulletin #118 at www.in.gov/dor/files/reference/ib118.pdf for additional information. Line 6 – Other Add-Backs Each of the following add-backs has been assigned a 3-digit code number. When reporting the add-back, write its name, the associated 3-digit number and the amount. Conformity Add-Back Before this publication was finalized Indiana had not conformed to any changes to the Internal Revenue Code (IRC) that may have become law after January 1, 2023. Therefore, the IRC used to figure Indiana income may not wind up being the same as the IRC used to figure federal income. This add-back is specific to these annual current year conformity issues. If uncertainty exists as to whether or not Indiana will adopt some or all of the federal legislation passed after January 1, 2023, that acts to modify federal AGI, you may add-back those items as an “other” add-back. In the event those items are adopted, an amended return should be filed to recoup the add-back(s). Conformity Add-Back – Positive Entry 120 This add-back is only for: • current year conformity issues, and • add-backs required by Indiana legislation passed retroactively to years before 2023. Conformity issues for preceding tax years must be addressed on the add-back line specific to the item in question. Schedule 1: Add-Backs Continued

IT-40 Booklet 2023 Page 14 If the state legislature does not conform to federal code changes enacted after January 1, 2023, you may have to amend your return at a later date to reflect any differences between Indiana and federal law. You may wish to periodically check DOR’s homepage at www.in.gov/ dor for updates. Enter code 120 on Schedule 1 under line 6 if reporting this add-back. Conformity Add-Back – Negative Entry 147 This add-back generally is based on conformity issues arising from a previous year or on deductions enacted by Indiana legislation passed retroactively to years before 2023. However, in rare cases this can arise from conformity issues arising in the current year where the IRC treats an item as taxable or nondeductible that was previously exempt or deductible. Enter code 147 on Schedule 1 under line 6 if reporting this add-back. Employer Student Loan Payment Add-Back 148 If your employer paid any amount for your student loans and you excluded the payment from your federal gross income, add back the amount you excluded from your gross income. This amount must be added back regardless of whether your employer paid you the amount for your student loans or whether your employer paid the student loan on your behalf. Also see the instructions for the deduction for the Employer Student Loan Payment Interest Deduction on page 20. Excess Federal Interest Deduction Modification 142 IRC Section 163(j) limits the federal interest deduction for most business interest to 30% (50% for 2019 and 2020 in certain cases) of adjusted taxable income plus business interest. However, Indiana has decoupled from this provision. Subtract an amount equal to the amount as a deduction for excess business interest under IRC Section 163(j) in the year in which the interest was first paid or accrued. If you are deducting any business interest carried over from a previous year, add the amount of this interest deducted. Enter code 142 on Schedule 1 under line 6 if reporting this add-back. Federal Repatriated Dividend Deduction Add-Back 139 Untaxed foreign earnings and profits are repatriated dividends that need to be reported when filing state taxes. Individuals should add back the deduction taken on federal Form 965, Line 17. For additional information see Income Tax Information Bulletin #116 at www.in.gov/ dor/files/reference/ib116.pdf. Modifications for Excess Business Losses 151 If you: • Have a current-year excess business loss under IRC section 461(l) that is not deducted in determining your federal adjusted gross income, • Have current-year federal deductions that: ο are disallowed in determining your current-year federal adjusted gross income, and ο for which an add-back is required for Indiana adjusted gross income tax purposes, use Code 151 to deduct the add-backs required for Indiana purposes. The most common examples will be bonus depreciation, IRC section 179 expensing, and the add-back for state and local taxes deducted in determining federal adjusted gross income. Do not report modifications arising from prior year Indiana modifications such as bonus depreciation catch-up modifications. First, if you have such add-backs, report the add-backs in the normal manner as if no excess business loss limitation was in effect under IRC section 461(l). Second, report the lesser of these add-backs required for Indiana purposes or the IRC section 461(l) disallowance (Form 1040, Schedule 1, Line 8p) as a Code 151 deduction. The Code 151 deduction will reduce the net operating loss carryforward allowable for Indiana purposes. Example. Bob has $100,000 of federal adjusted gross income, consisting of $370,000 salary and a $270,000 allowable loss from Partnership A. Bob has a $300,000 excess business loss disallowed from Partnership A. Bob’s share of Partnership A’s income included $470,000 in losses other than bonus depreciation and $100,000 of bonus depreciation, of which only $270,000 of cumulative losses are allowed in the current year. Bob otherwise has an $80,000 bonus depreciation add-back for Indiana purposes. Bob will report the $80,000 add-back for bonus depreciation and also report an $80,000 deduction using Code 151. This will also result reduce the net operating loss for the current year to $220,000 ($300,000 excess business loss minus $80,000). Example. Bob has $100,000 of federal adjusted gross income, consisting of $370,000 salary and a $270,000 allowable loss from Partnership A. Bob has a $300,000 excess business loss disallowed from Partnership A. Bob’s share of Partnership A’s income included $170,000 in losses other than bonus depreciation and $400,000 of bonus depreciation, of which only $270,000 of cumulative losses are allowed in the current year. Bob otherwise has a $320,000 bonus depreciation add-back for Indiana purposes. Bob will report the $320,000 add-back for bonus depreciation. However, because the excess business loss is less than the Indiana add-back, the Code 151 deduction is limited to the $300,000 excess business loss. The net operating loss for the current year will be zero. Modifications from Excess Inclusion Income 153 If you: • Have a net operating loss for federal purposes incurred the current taxable year that does not appear in your federal taxable income as a result of reporting excess inclusion income under IRC section 860E; and • Have modifications to your Indiana adjusted gross income that are allowable in determining your Indiana net operating loss; use Code 153 to report the amount of modifications that are allowable in determining the portion of your net operating loss not already part of your adjusted gross income. In most cases this will equal your excess inclusion income. Report the net modifications using the inverse of the signage for the underlying modifications. Example. Individual A has a $100 of excess inclusion income. Individual A also has a $20,000 Indiana bonus depreciation add-back and a $50,000 net operating loss for federal purposes. The portion of net operating loss not directly reported for federal purposes is $100 (the excess inclusion income). Individual A will report the $20,000 Schedule 1: Add-Backs Continued

IT-40 Booklet 2023 Page 15 add-back as bonus depreciation and a negative $100 using Code 153. The Code 153 in conjunction with other modifications will result in a $30,000 Indiana net operating loss. Do not report a Code 153 modification if: • The amount determined is positive (i.e., net deductions exceed net add-backs), or • You do not have a federal net operating loss. Qualified Preferred Stock 113 If an individual: • Had losses from the sale or exchange of preferred stock in either Federal National Mortgage Association or Federal Home Loan Mortgage Corporation; • Treated the loss from the sale or exchange as ordinary income for federal income tax purposes in the year the loss had been incurred; and • Had any amount previously added back that not been allowed as a deduction, the individual is permitted to continue deducting the loss not previously allowed as a capital loss. However, the amount allowable as a capital loss must be computed in accordance with federal limitations on allowable capital losses. See IRC sections 1211 and 1212 for further details on federal limitations. Enter code 113 on Schedule 1 under line 6 if reporting this add-back. Specified Research and Experimental Expenses Add-Back 154 If you claimed a federal income tax deduction for specified research and experimental expenses that are required to be amortized for federal purposes pursuant to IRC section 174, add back the amount of expenses you actually deducted for federal income tax purposes. See the instructions for Code 641 for further information on the amount of expenses allowable as a deduction. Note. If after printing of these instructions, IRC Section 174 is amended to allow immediate expensing of research and experimental expenses and you elect to amortize those expenses, you cannot use this code and Code 641 to accelerate the allowance of your expenses. Example. Individual A incurred $100,000 of specified research expenses in 2023. Individual A reported $10,000 of amortized expenses in 2023. Individual A 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 2024-2028, Individual A will continue to use Code 154 to report timing differences. Student Loan Discharge Add-Back 150 If you had a student loan discharged during the taxable year and you excluded the amount of the discharge from your federal gross income, add back the amount of discharged loans excluded from your federal gross income. Do not add back amounts discharged or repaid via: • The Public Service Loan Forgiveness Program. • The Teacher Loan Forgiveness Program. • The National Health Service Corps Loan Repayment Program. • Other programs that qualify under IRC section 108(f)(4). • A discharge granted to a borrower under the Closed School or Defense to Repayment discharge processes if the IRS permits the discharge to be excluded from gross income. • The death or total and permanent disability of the student. • The discharge of the student loan in bankruptcy. • If the student loan was discharged while the borrower was insolvent. However, the discharge is limited to the amount the borrower was insolvent. Further, if a loan is discharged under the other bullets, those discharges must be applied before the insolvency exception. Note. The amounts added back may include portions of student loans forgiven during 2023. This add-back applies to student loans forgiven under income-based repayment plan corrections. These loans are subject to the insolvency exception above. The exceptions listed above also apply to 2023 loan forgiveness even if the loan may not have been forgiven otherwise. Certain Discontinued Add-Backs: How and When to Report a Final Catch-Up Modification. Required add-backs for the following modifications have been eliminated, effective Jan. 1, 2013: • Motorsports Entertainment Complex, Code 130 • Qualified Advance Mining Safety Equipment, Code 126 • Qualified Electric Utility Amortization, Code 135 • Qualified Environmental Remediation Costs, Code 121 • Qualified Leasehold Improvement Property, Code 129 • Qualified Restaurant Improvement Property, Code 108 • Qualified Retail Improvement Property, Code 109 • Start-Up Expenditures, Code 131 Required add-backs for the following modifications have been eliminated, effective Jan. 1, 2016: • Qualified Disaster Assistance Property, Code 110 • Qualified Refinery Property, Code 111 • Qualified Film or Television Production, Code 112 If you previously reported any of these add-backs, see the following example for guidance as to how to figure and report a final catch-up modification. Example. Grant has qualified restaurant equipment. For federal tax purposes he used the accelerated 15-year recovery period for an asset placed in service since 2009. Since 2009 Grant had been adding back the depreciation expense taken for federal purposes that exceeded the amount allowable for Indiana purposes. The accumulated depreciation on such an asset through 2012 was, therefore, different for federal and state purposes. This difference will remain until the asset is fully depreciated or until the time of its disposition. A simple illustration: Asset – acquired January, 2009 – qualified restaurant property – purchase price $120,000. This normally would have had a 39-year recovery period; IRC Sec. 168 allows for a 15-year recovery period. Schedule 1: Add-Backs Continued

IT-40 Booklet 2023 Page 16 Asset acquired Jan. 2009 $120,000 purchase price Federal Depreciation Add- Back Indiana Depreciation Year 1 (2009) 8,000 4,924 3,076 Year 2 (2010) 8,000 4,924 3,076 Year 3 (2011) 8,000 4,924 3,076 Year 4 (2012) 8,000 4,924 3,076 Year 5 (2013) Accumulated Depreciation 8,000 40,000 0 8,000 20,304 Year 6 – 15 Accumulated Depreciation 80,000 120,000 0 80,000 100,304 Year 16 – 38 Accumulated Depreciation 0 0 0 Year 39 (or year of disposition) Add-back 0 -19,696 19,696 Tax year 2012 is the last year Grant reported an add-back until the end of the recovery period. Had this asset been sold before being fully depreciated, the catch-up modification would be reflected in the year of the sale. If this property is held through 2048 (the 39th year of depreciation), Grant will report a negative $19,696 catch-up add-back on his 2048 state tax return. Enter the associated 3-digit code on Schedule 1 under line 6 if reporting a final catch-up modification. Reporting Certain Prior-Year Modifications In certain cases, a modification in a prior year may have been limited due to various federal limitations, including basis limitations, passive loss limitations, and at-risk loss limitations. Even though certain modifications may not apply to activities during the current taxable year, you may be required to report a modification when you have income against which to realize the modification. Use the modification code for the year in which the modification was actually accrued. This includes, but is not limited to, modifications required to be reported using 3-digit Code 149 (Meal Deduction Add- Back) and Code 634 (COVID-Related Employee Retention Credit Disallowed Expenses Deduction). Schedule 2: Deductions Line 1 – Renter’s Deduction You may be able to take the renter’s deduction if: • You paid rent on your principal place of residence, and • You rented a place that was subject to Indiana property tax. Your “principal place of residence” is the place where you have your true, fixed, permanent home and where you intend to return after being absent. If you rented a manufactured home or paid rent for your manufactured home lot, you may claim the renter’s deduction if the above requirements are met. Rent paid for summer homes or vacation homes is not deductible. You cannot claim the renter’s deduction if the rental property was not subject to Indiana property tax. Examples of this type of property are: • Government owned housing, • Property owned by a nonprofit organization, • Student housing, • Property owned by a cooperative association, and • Property located outside of Indiana. How do I report my deduction? First, complete the information area by entering: • The address where rented if it’s different from the address on the front of the return (leave blank if it is not different), • The landlord’s name and address, • The total amount of rent paid, and • The number of months you lived there. If you moved during the year or had more than one landlord, you must list the same information for each place that you rented. Enclose additional pages if necessary. How much rent can I deduct? You can deduct up to $3,000 ($1,500 if married filing separately) or the amount of rent paid, whichever is less. Example. Emily paid $4,800 in rent on her principal place of residence. She will claim a $3,000 renter’s deduction. Example. Bill paid $400 rent for his first apartment. He moved to another location during the year and paid $2,800 rent for the rest of the year. His deduction will be limited to $3,000, even though he paid $3,200 altogether. Important. Keep copies of your rental receipts, landlord identifying information and lease agreements as DOR can require you to provide this information. For more information about this deduction, see Income Tax Information Bulletin #38 at www.in.gov/dor/files/reference/ib38.pdf. Line 2 – Homeowner’s Residential Property Tax Deduction You may be able to take a deduction of up to $2,500 ($1,250 if married filing separately) of the Indiana property taxes (residential real estate taxes) paid on your principal place of residence. Your “principal place of residence” is the place where you have your true, fixed home and where you intend to return after being absent. Note. Property tax paid for summer homes or vacation homes is not deductible. Important. You cannot claim this deduction for property tax paid in 2023 if you are claiming the Lake County residential income tax credit on Schedule 5, line 7. How do I claim my deduction? Complete the information area on Schedule 2, line 2. Enter the address of your principal residence where the Indiana property tax was paid if it is different from the address on the front of the return. If you had more than one principal residence during the year, and you paid Indiana property tax on both residences, list the additional residence on a separate piece of paper. Schedule 2: Deductions

IT-40 Booklet 2023 Page 17 Example. Jamie and Ella each owned their own home; they married in 2023. They sold both of their homes during the year and began renting. They are eligible to claim a property tax deduction on the combined property taxes paid on both homes if they are filing a joint return (limited to $2,500 altogether). • Enter the number of months you lived there. If you claim more than one residence, enter the number of months lived at the other residence(s) on a separate sheet of paper. • Enter the amount of Indiana property tax paid. If you lived in more than one residence during the year, enter the combined amount of Indiana property tax paid on all principal residences. • Enter the smaller of $2,500 ($1,250 if married filing separately) or the amount of Indiana property tax paid. No double benefit allowed. If any portion of property taxes paid on your principal residence was deducted as an expense on federal Schedule C, E or F, then do not deduct that amount on this line. Example. Jean paid $1,200 in Indiana property tax on her home. She used one room of her home for her business, and deducted $200 Indiana property tax as an expense on her federal Schedule C. Jean is allowed a deduction of $1,000 ($1,200 minus the $200 deduction already taken on federal Schedule C). How do I find out how much I paid in Indiana property tax on my principal residence? Indiana counties send statements to homeowners showing how much property tax is due on their property. Add together the 2023 spring and fall installments, if you paid both of them. If you received just one installment statement this year for your 2023 property taxes, use the amount paid for that installment. Sometimes mortgage companies pay the Indiana property tax from an escrow account. If your mortgage company pays it, they should send you a Form 1098 (or its equivalent) showing the amount of property tax paid. If you cannot locate the information, contact your local county treasurer’s office or your mortgage company. Important. You must maintain copies of proof that you paid your Indiana property tax as DOR can require you to provide this information. This could include the Form 1098, the property tax statement from your local assessor’s office, cancelled checks, etc. Line 3 – State Tax Refund Reported on Federal Return If you entered a state tax refund amount on federal Schedule 1, line 1, then enter that amount here. Line 4 – Interest on U.S. Government Obligations Deduction If the amount on line 1 of Form IT-40 includes interest income, you may be able to take a deduction. If any part of your interest income included on line 1 is from a direct obligation of the U.S. government, you can deduct this amount. Examples of U.S. government obligations include U.S. savings bonds, U.S. Treasury bills and U.S. government certificates. This interest is usually reported on federal Schedule B. Interest income reported from a trust, estate, partnership or S corporation that is from U.S. government obligations should also be deducted on this line. Note. When certain U.S. savings bonds are redeemed to pay expenses for higher education, the interest may be excluded from federal adjusted gross income. Therefore, do not enter any interest from U.S. savings bonds that is shown on your federal Schedule B, line 3 (because it has already been excluded from income). For more information about this deduction see Income Tax Information Bulletin #19 at www.in.gov/dor/files/reference/ib19.pdf. Lines 5 and 6 – Taxable Social Security and/or Railroad Retirement Benefits Deduction Indiana does not tax Social Security income or the railroad retirement benefits that are issued by the U.S. Railroad Retirement Board. To figure your deduction: • Enter the amount from federal Form 1040/1040-SR, line 6b, on Indiana’s Schedule 2, line 5. • If you have included railroad retirement benefits that are issued by the U.S. Railroad Retirement Board on line 5b of your federal Form 1040/1040-SR, then enter that amount on Indiana’s Schedule 2, line 6. Important. Do not enter any other types of pension or retirement income on these lines. Note. See the Railroad Unemployment and Sickness Benefits deduction instructions on page 22 if you have received unemployment and/or sickness benefits from the Railroad Retirement Board. A Word About the Three Military Income Deductions Military income recipients may be eligible to claim one or more of the three deductions based on the type of income/benefits they get. 1. Military Service Deduction (including the National Guard and reserve component of the armed forces) Individuals with military pay from active duty in the armed forces, may be eligible to deduct up to $5,000 of that income. See the Military Service Deduction below to find out if you qualify for this deduction. 2. Military Retirement Income and/or Survivor’s Benefits Deduction Individuals with military retirement income and/or survivor’s benefits may be eligible to deduct those benefits. See the Military Retirement Income and/or Survivor’s Benefits Deduction information on page 22 to see if you qualify. 3. National Guard and Reserve Component Members Deduction This deduction is available for qualified military income received as a member of the Indiana National Guard or an armed forces reserve component. See the National Guard and Reserve Component Members Deduction on page 22 to see if you qualify for this deduction. Schedule 2: Deductions Continued

IT-40 Booklet 2023 Page 18 Line 7 – Military Service Deduction (active duty armed forces members only) Note. National Guard and armed forces reserves members will not report the deduction for their income on this line. Please see the instructions for Line 11, National Guard and Reserve Component Members Deduction on page 22. Important. The military service deduction and the military retirement income and/or survivor’s benefits deduction are reported in two different places. • You (and/or your spouse, if married filing jointly and both qualify) will report your active military service income deduction here. • You (and/or your spouse, if married filing jointly and both qualify) will report your military retirement income and/or survivor’s benefits deduction on Schedule 2 under line 11, Other Deductions. See the instructions for Military Retirement Income and Survivor’s Benefits Deduction on page 22. The income on line 1 of Form IT-40 may include military pay from active duty in the armed forces (reserve). If it does, you may be eligible to take this deduction. The deduction will be the actual amount of your active duty military income or $5,000, whichever is less. If both you and your spouse received active duty military income, you may each claim the deduction for a maximum of $10,000 (up to $5,000 each). Example 1. Louis earned $25,000 from active service in the Army. Brooklynn, his wife, earned $2,640 from the Indiana National Guard. Louis is eligible for the maximum $5,000 deduction; Brooklynn is not eligible to claim the deduction on this line. However, Brooklynn can claim a $2,640 deduction using Code 621 on Line 11. Military income earned while in a combat zone is not taxable on your federal or state income tax returns. Since Indiana is not taxing this income, your combat zone income is not eligible for a deduction. Example 2. Jim was on active duty the first month of the year. He was stationed in a combat zone the rest of the year. His military W-2 form shows the first month’s regular military wage income of $1,250 in Box 1. Only $1,250 of his income is taxed on his federal (and Indiana) tax returns. Jim should claim a $1,250 military deduction (the lesser of the income being taxed [$1,250] or $5,000). Important. You must enclose your military W-2 form(s) if you are claiming this deduction. For more information about this deduction see Income Tax Information Bulletin #27 at www.in.gov/dor/files/reference/ib27.pdf. Line 8 – Private School/Homeschool Deduction You may be eligible for a deduction based on education expenditures paid for each dependent child who is enrolled in a private school or is homeschooled. Dependent Child Qualifications • Your dependent child must be eligible to receive a free elementary or high school education (K-12 range) in an Indiana school corporation; • You must be eligible to claim the child as a dependent on your federal tax return; and • The child must be your natural or adopted child or, if not, you must have been awarded custody of the child in a court proceeding making you the court appointed guardian or custodian of the child. Education expenditure. This refers to any expenditures made in connection with enrollment, attendance, or participation of your dependent child in a private elementary or high school education program. The term includes tuition, fees, computer software, textbooks, workbooks, curricula, school supplies (other than personal computers), and other written materials used primarily for academic instruction or for academic tutoring, or both. The term does not include the delivery of instructional service in a home setting to your dependent child who is enrolled in a school corporation or a charter school. This term also does not include educational expenditures that are reimbursed, such as by a scholarship or grant. A “private elementary or high school education program” means attendance at a nonpublic school (including a private school, a parochial school and a homeschool) in Indiana that satisfies a child’s obligation for compulsory attendance at a school. The obligation for “compulsory attendance” means a child must be in attendance in a school (public and/or private) for a minimum of 180 days in a calendar year. Note. No deduction will be available based on a child who is enrolled in school for a period of less than 180 days in a calendar year. Figure your deduction. If you made an unreimbursed education expenditure during the year your deduction is: • $1,000; multiplied by • the number of qualified dependent children for whom you made education expenditures. Example. Greg and Constance have three children ages 7, 9 and 11. The two oldest children attend a private school. The youngest child attends the neighborhood public school. The parents purchased schoolbooks for all three children. They will be eligible for a $2,000 deduction (the youngest does not qualify as he attends a public school). Note. A qualifying child may be claimed for this deduction only once per year. For example, if a husband and wife are married and filing separately, whichever parent is eligible to claim the child as a dependent for exemption purposes is eligible to claim this deduction. For more information about this deduction, see Income Tax Information Bulletin #107 at www.in.gov/dor/files/reference/ib107.pdf. Line 9 – Indiana Net Operating Loss Deduction You may take a deduction for any Indiana net operating losses allowable. (This will be a net operating loss deduction from an earlier year(s) carried forward to 2023). Schedule 2: Deductions Continued

IT-40 Booklet 2023 Page 19 Complete Schedule IT-40NOL to determine the amount available to be deducted this year. Make sure to enter the amount you are eligible to deduct as a positive figure. Note. It is possible to have an Indiana NOL without also having a federal NOL. See the instructions for IT-40NOL beginning on page 46. For years prior to 2023, the modifications required to compute an Indiana NOL may have changed after publication of the IT-40NOL for the prior year. See the instructions for a list of modifications required for each year and, if necessary, revise the IT-40NOL for changes in modifications. In most cases, you will need to complete federal Form 1045 in order to determine your federal net operating loss. You may be asked to provide a copy of federal Form 1045 or such other calculations necessary to determine your federal and Indiana net operating loss. Enclose a completed Indiana Schedule IT-40NOL when claiming this deduction. If your Schedule A from federal Form 1045 included itemized deductions to increase the federal net operating loss, enclose a pro forma copy of the Schedule A computing the net operating loss without the itemized deductions. Also, maintain with your records a copy of the federal Form 1040/1040-SR from the loss year as DOR can require you to provide this information at a later date. Line 10 – Nontaxable Portion of Unemployment Compensation You may be eligible for a deduction if you reported unemployment compensation on your federal income tax return. Complete the worksheet below to see if you are eligible. Make sure to enclose your 1099G(s) if you claim the deduction. Important. Do not include any unemployment compensation issued by the U.S. Railroad Retirement Board on line 1 of the worksheet. Instead, see the instructions for the Railroad Unemployment and Sickness Benefits Deduction on page 22 for more information. Line 11 – Other Deductions Each of the following deductions has been assigned a 3-digit code number. When claiming the deduction on Schedule 2 under line 11, write the name of the deduction, the three-digit code number and the amount claimed. Career Scholarship Account Deduction 642 If you received a distribution from a career scholarship account and that distribution is included in your federal adjusted gross income, you are entitled to a deduction for the portion of the distribution included in your federal adjusted gross income. Note. Do not claim this deduction if the distribution was not included in your federal adjusted gross income. Civil Service Annuity Deduction 601 The income on line 1 of Form IT-40 may include federal civil service annuity income. If it does, you may be eligible to take a deduction if you were at least 62 years of age by the end of the tax year and/or a surviving spouse of a civil service annuitant. For each civil service annuitant, the deduction is limited to: • The lesser of the amount of taxable civil service annuity income included in federal adjusted gross income or $16,000, • Less all amounts of Social Security income and tier 1 and tier 2 Railroad Retirement income (issued by the Railroad Retirement Board) received by the civil service annuitant. Example. The taxable amount of your civil service annuity is $6,000. You received $1,200 in Social Security income. You are age 67. Here is how to figure your deduction. Lesser of the taxable amount of the annuity or $16,000............. $6,000 Total of Social Security/tier 1 & tier 2 Railroad Retirement income..........................................................................- $1,200 Allowable deduction ....................................................................... $4,800 If you receive a civil service annuity both for yourself and as a surviving spouse, the combined deduction cannot exceed $16,000. Schedule 2: Deductions Continued Unemployment Compensation Worksheet Note: If you were married but filing separately, and you lived with your spouse at any time during the year, enter -0- on line 3 of the worksheet.

However, if you were married but filing separately, and lived apart from your spouse the entire year, enter $12,000 on line 3. 1. Unemployment compensation included on IT-40, line 1 (do not include any unemployment compensation issued by the Railroad Retirement Board - see instructions)............................................... 1 2. Federal adjusted gross income from federal Form 1040, line 11................................................................. 2 3. Enter $12,000 if single, or $18,000 if married filing a joint return................................................................. 3 4. Subtract line 3 from line 2. If zero or less, enter -0-..................................................................................... 4 5. Enter one-half of the amount on line 4 (divide line 4 by the number 2)....................................................... 5 6. Taxable unemployment compensation for Indiana purposes: enter the amount from either line 1 or line 5, whichever is smaller...................................................................................................................... 6 7. Subtract line 6 from line 1. Carry this amount to Schedule 2, line 10.......................................................... 7

IT-40 Booklet 2023 Page 20 Example. Matthew and Claire, both age 68, file a joint federal and state income tax return. They each receive a civil service annuity and Social Security income. Matthew’s taxable civil service annuity is $13,700; he also received $17,500 in Social Security income. Since the Social Security income he received is greater than the taxable amount of his annuity, he is not eligible for a deduction. Claire’s taxable civil service annuity is $21,900; she also received $6,300 in Social Security income. Here is how to figure Claire’s deduction. Lesser of the taxable amount of the annuity or $16,000............. $16,000 Claire’s Social Security income.......................................................- $6,300 Allowable deduction ....................................................................... $9,700 Surviving Spouse A surviving spouse may be eligible to claim this deduction. There is no age requirement for the surviving spouse. To figure the deduction, begin with the taxable amount of civil service annuity income or $16,000, whichever is less. Subtract from that amount any Social Security income and tier 1 and tier 2 Railroad Retirement income (issued by the Railroad Retirement Board) the surviving spouse received. Example. Marie is a surviving spouse. The taxable amount of her civil service annuity is $14,500, and she received $1,200 in Social Security income. Here is how to figure Marie’s deduction. Lesser of the taxable amount of the annuity or $16,000............. $14,500 Marie’s Social Security income.......................................................- $1,200 Allowable deduction ....................................................................... $13,300 You must maintain Form CSA 1099-R with your records as DOR can require you to provide it at a later date. For more information about this deduction see Income Tax Information Bulletin #6 at www.in.gov/dor/files/reference/ib06.pdf. Enter code 601 on Schedule 2 under line 11 if claiming this deduction. Disability Retirement Deduction 602 To take this deduction you must have been: • Permanently and totally disabled at the time of retirement, • Retired on disability before the end of the tax year, and • Received disability retirement income during the tax year. If you meet these qualifications, you must complete Schedule IT-2440 and have it signed by your doctor to claim this deduction. You must maintain the completed Schedule IT-2440 with your records as DOR can require you to provide it at a later date. For more information about this deduction see Income Tax Information Bulletin #70 at www.in.gov/dor/files/reference/ib70.pdf and Schedule IT- 2440 at www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. This deduction is limited to a maximum of $5,200 per qualifying individual. Note. Social Security disability income does not qualify for this deduction because Indiana does not tax this income. Enter code 602 on Schedule 2 under line 11 if claiming this deduction. Employer Student Loan Payment Interest Deduction 637 If you are required to add back employer-paid student loan payment using Code 148, you are permitted to deduct the amount of student loan interest that: • was paid by your employer, and • you would have been permitted to deduct if federal law did not disallow that deduction. Complete Worksheet 4-1 provided in IRS Publication 970 to determine the amount (if any) of additional interest allowable for Indiana purposes, but not in excess of $2,500 total. When completing Worksheet 4-1, do not add back amounts required to be added to Indiana adjusted gross income using Code 148. This deduction cannot exceed the amount you are required to add back using Code 148. Enterprise Zone Employee Deduction 603 Certain areas within Indiana have been designated as enterprise zones. Enterprise zones are established to encourage investment and job growth in distressed urban areas. Enterprise zones have been established in areas of certain cities/ locations. Use this website to look up contact information for a particular enterprise zone: www.aiez.org/#mem Your employer will provide Form IT-40QEC to you if you are eligible to claim this deduction. The amount of the deduction is one-half of the earned income shown on Form IT-40QEC or $7,500, whichever is less. If you and your spouse both have received Form IT-40QEC, you may each take this deduction for a combined maximum of $15,000 (no more than $7,500 per qualifying person). Enter code 603 on Schedule 2 under line 11 if claiming this deduction. Government or Civic Group Capital Contribution Deduction 633 A deduction is available for certain capital contributions made by a government or civic group. Deduct any eligible contributions as listed on a Schedule K-1 you received from an S corporation, or from an estate or trust that owns a portion of an S corporation AND through which you are receiving a distribution. You must maintain a copy of the Schedule K-1(s) with your records as DOR can require you to provide it at a later date. Enter code 633 on Schedule 2 under line 11 if claiming this deduction. Human Services Deduction 605 The human services deduction is intended to eliminate any individual income tax imposed on Medicaid recipients who are living in a: • Hospital, • Skilled nursing facility, Schedule 2: Deductions Continued

IT-40 Booklet 2023 Page 21 • Intermediate care facility, • Licensed county home, • Licensed boarding or residential home, or • Certified Christian Science facility.* The goal of the human services tax deduction is to reduce the affected individual’s adjusted gross income tax liability to zero (-0-). *An eligible Christian Science facility must be listed with and certified by the Commission for Accreditation of Christian Science Nursing Organizations/Facilities, Inc. Generally, the deduction should not be used in conjunction with most tax credits in order to create a refund. If you are a Medicaid recipient and live in one of the facilities listed above, to determine whether you are eligible for the deduction you must first prepare your tax return without claiming a human services deduction. Generally, if a refund is due, you are not eligible for a deduction. File your return without claiming the deduction and a refund will be issued. However, if an amount is due, you are eligible to use a deduction. Enter code 605 on Schedule 2 under line 11 if claiming this deduction. Indiana Education Scholarship Account Deduction 635 A deduction is available if you received an annual grant amount distributed to your Indiana education scholarship account that is used to pay for qualified expenses. See IC 20-51.4-2-9 for a list of qualified expenses. Do not deduct any grants that are not included in your federal gross income. Also, if the grant is used to pay for items other than qualified expenses, do not deduct the amount of those payments. Indiana Enrichment Scholarship Account Deduction 638 A deduction is available if you received an annual grant amount distributed to your Indiana enrichment scholarship account that is used to pay for qualified expenses. Qualified expenses are enrichment materials, activities, or programs approved by the Indiana Department of Education to improve student proficiency in math or reading. Do not deduct any grants that are not included in your federal gross income. Also, if the grant is used to pay for items other than qualified expenses, do not deduct the amount of those payments. Indiana Lottery Winnings Annuity Deduction 629 You may be eligible to deduct annuity payments received from a winning Hoosier Lottery ticket for a lottery held prior to July 1, 2002. 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. Example. Jennifer won $2,000,000 playing the Hoosier Lottery with a ticket purchased in June of 2002. She elected to receive annual installment payments of $100,000. Since Jennifer reported her $100,000 annuity payment on her federal tax return this year, she is eligible to claim a $100,000 deduction. Note. Individuals or entities that have purchased Hoosier Lottery prizes from a winning ticket holder for valuable consideration are not eligible for this deduction. Enter code 629 on Schedule 2 under line 11 if claiming this deduction. Indiana-only Tax-exempt Bonds Deduction 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. Indiana Partnership Long-Term Care Policy Premiums Deduction 608 You may take a deduction for the amount of premiums paid for Indiana partnership long-term care insurance. If you are a married individual filing separately, you may not claim a deduction for amounts paid by or on behalf of your spouse. Important. The Indiana partnership policy will have the following box of information on the outline of coverage, the application or on the front page of the policy. This policy qualifies under the Indiana Long-Term Care program for Medicaid Asset Protection. This policy may provide benefits in excess of the asset protection provided in the Indiana Long-Term Care program. If the information shown in the box above is not located in a box on your policy, you do not have a qualifying policy, and are not eligible to take this deduction. The deduction is the amount of premiums paid during the year on the policy for the taxpayer and/or spouse. No double benefit allowed. Certain self-employed individuals will claim these premiums as a deduction on federal Form 1040/1040-SR. The Indiana deduction will be the actual amount of these premiums paid, minus any amount of these already reported on federal Form 1040/1040-SR. More information about this program is available at www.in.gov/iltcp. Important. Keep a copy of the premium statements as DOR can require you to provide this information. Enter code 608 on Schedule 2 under line 11 if claiming this deduction. Infrastructure Fund Gift Deduction 631 A deduction is available for certain contributions made to a regional development infrastructure fund. You should keep detailed records of the contribution as DOR can require you to provide this information at a later date. Enter code 631 on Schedule 2 under line 11 if claiming this deduction. Schedule 2: Deductions Continued

IT-40 Booklet 2023 Page 22 Military Retirement Income and/or Survivor’s Benefits Deduction 632 The income on line 1 of Form IT-40 may include military retirement income and/or survivor’s benefits. If it does, you (and/or your spouse, if married filing jointly and both qualify) may be eligible to take this deduction. For 2022 and later, the deduction is equal to the entire amount of military retirement income and/or survivor’s benefits. Important. You must enclose your military retirement income statement(s) and/or survivor’s benefit statement(s) with the tax return if you are claiming this deduction. For more information about this deduction see Income Tax Information Bulletin #6 at www.in.gov/dor/files/reference/ib06.pdf. National Guard and Reserve Component Members Deduction 621 Beginning in 2023, regular military income for National Guard members and armed force reserve members is eligible for a full deduction for their military income under this code. Do not deduct this income using any other line or three-digit code. Unlike the Military Service Deduction on line 7, this deduction does not have a dollar limit. Who is Eligible? You must be a member of the reserve components of: • the Army; • the Navy; • the Air Force; • the Coast Guard; • the Marine Corps; or • the Merchant Marine. Or, a member of: • the Indiana Army National Guard; or • the Indiana Air National Guard. What is Eligible to be Deducted? If you are eligible, your deduction is your military income received for service in the reserve component of the armed forces or in the Indiana National Guard. Deployment, mobilization, or federalization is no longer required to be eligible for this deduction for 2023 and later. Do not deduct income received: • As a civilian member of the armed forces or National Guard. • As a member of an active duty component of the armed forces. • From employment or any other source outside the National Guard or reserve components of the armed forces. Note. Military income received due to service in a combat zone is not taxable on your federal or state income tax returns. Since Indiana is not taxing this income, your combat zone income is not eligible for this deduction. Note. You cannot claim both this deduction and the Military Service Deduction (see page 17) based on the same income. Get Income Tax Information Bulletin #27 at www.in.gov/dor/files/ reference/ib27.pdf for more information concerning this deduction. Enter code 621 on Schedule 2 under line 11 if claiming this deduction. Olympic/Paralympic Medal Winners Deduction 627 You are eligible for a deduction if you won a gold, silver and/or bronze medal from participating in the Olympic/Paralympic games. The deduction equals the value of the medal(s) won plus the amount of income received during the taxable year from the United States Olympic Committee as prize money for winning the Olympic medal(s). If these amounts were previously deducted or excluded in determining your federal adjusted gross income, you are not permitted this deduction for the amounts that were excluded or deducted in determining your federal adjusted gross income. This deduction may be claimed only in the tax year in which the medal was won. Enter code 627 on Schedule 2 under line 11 if claiming this deduction. Qualified Patents Income Exemption Deduction 622 Some of the income from qualified patents included in federal taxable income may be exempt from Indiana adjusted gross income tax. A qualified patent is a utility patent or a plant patent issued after Dec. 31, 2007, for an invention resulting from a development process conducted in Indiana. The term does not include a design patent. You must maintain the completed Schedule IN-PAT with your records as DOR can require you to provide it at a later date. You may get Schedule IN-PAT at www.in.gov/dor/tax-forms/2023-individual- income-tax-forms. For more information about this deduction see Income Tax Information Bulletin #104 at www.in.gov/dor/files/reference/ib104. pdf. Enter code 622 on Schedule 2 under line 11 if claiming this deduction. Railroad Unemployment and Sickness Benefits Deduction 624 Benefits issued by the U.S. Railroad Retirement Board are not taxable by Indiana. Deduct unemployment and/or sick pay benefits issued by the U.S. Railroad Retirement Board on this line if: • You included these benefits as taxable income on your federal tax return, and • You did not already deduct these benefits on Schedule 2, lines 5 and/or 6. Do not include any supplemental sick pay benefits on this line. Make sure to keep the statements (such as Form 1099G) issued by the U.S. Railroad Retirement Board as DOR may request them at a later date. Enter code 624 on Schedule 2 under line 11 if claiming this deduction. Schedule 2: Deductions Continued

IT-40 Booklet 2023 Page 23 Recovery of Deductions 616 You are not eligible for this deduction if you did not complete the “other income” line on Schedule 1 of your federal Form 1040/1040-SR. Generally, Indiana does not allow you to claim itemized deductions from federal Schedule A. However, if you reported recovered itemized deductions as “other income” on line 8 of your federal Schedule 1, enter that amount on this line. A recovery is a return of an amount you deducted in an earlier year. The most common recoveries are refunds (see Indiana’s Schedule 2, line 3), reimbursements and rebates of deductions previously itemized on federal Schedule A. Enter code 616 on Schedule 2 under line 11 if claiming this deduction. Repayment of Previously Taxed Income Deduction 630 You may be eligible to claim a deduction for the repayment of previously taxed income, also known as “claim of right,” if: • You reported the income to Indiana in a previous year, • You repaid some or all of it this year, and • For federal tax purposes, you are eligible to: ο claim the repayment as an itemized deduction, or ο claim a credit based on the repayment amount. Example 1. Ryan was a full-year Indiana resident in 2022, and received $1,700 unemployment compensation that year. He reported the full amount on his 2022 federal and Indiana income tax returns. In March of 2023 Ryan found out he had to repay $345 of that compensation; he repaid it that summer. For 2023 federal tax purposes he is eligible to claim an itemized deduction* based on the $345 amount repaid. Ryan is eligible to claim the $345 amount as a repayment of previously taxed income as a deduction on his 2023 state tax return. *In this example, Ryan is not required to claim itemized deductions when figuring his federal taxable income for 2023; he cannot claim miscellaneous itemized deductions for federal purposes. Regardless, he is still eligible to claim the deduction on his state tax return. Note. An adjustment will need to be made if an unemployment compensation deduction was claimed on the return in the year the income was reported. To do this, reduce the amount previously reported by the amount repaid; refigure the deduction based on the reduced amount. Subtract the difference from the repayment amount to be deducted. Example 1, continued. Ryan claimed a $73 unemployment compensation deduction on his 2022 state tax return. He refigured the deduction based on the reduced $1,355 compensation ($1,700 - $345), which reduced the deduction by $15. Ryan will report the $330 net difference ($345 repayment minus the $15 reduced deduction amount) as the repayment of previously taxed income deduction. Important. While no corresponding state credit for the repayment of previously taxed income is available, a deduction based on the amount repaid is. Example 2. In 2023 Cynthia repaid $3,400 of income originally reported on her 2022 federal and Indiana state tax returns. She claimed a credit on her 2023 federal tax return based on the $3,400 amount repaid. Cynthia is eligible to claim the $3,400 amount as a deduction. Important. Indiana does not tax Social Security income. Therefore, any amount of Social Security income repaid in a subsequent year is not eligible for a deduction (since Indiana has not previously taxed this income). Note. Keep a copy of your records detailing the required repayment as DOR can require you to provide this information at a later date. Enter code 630 on Schedule 2 under line 11 if claiming this deduction. Small Employer Health Insurance Premium Deduction 639 If you: • Claimed a federal tax credit for small employer health insurance premiums under IRC section 45R; and • Would have been permitted a deduction for those premiums except for the disallowance under IRC section 280C(h), you are permitted a deduction for the portion of the premiums disallowed for federal purposes. Use Code 639 to enter the amount of premiums for which a deduction was disallowed for federal purposes because you claimed a federal tax credit for small employer health insurance premiums. Specified Research and Experimental Expenses Deduction 641 If you claimed a federal income tax deduction for specified research and experimental expenses that are required to be amortized for federal purposes pursuant to IRC section 174, deduct the amount of expenses paid or incurred in the current taxable year for federal income tax purposes. See the instructions for Code 154 for further information on the amount of expenses required to be added back. Do not claim this deduction for any research expenses for which a deduction is disallowed under IRC section 280C(c). Note. If after printing of this bulletin, IRC Section 174 is amended to allow immediate expensing of research and experimental expenses and you elect to amortize those expenses, you cannot use this code and Code 154 to accelerate the allowance of your expenses. Example. Individual A incurred $100,000 of specified research expenses in 2023. Individual A reported $10,000 of amortized expenses in 2023. Individual A 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 2024-2028, Individual A will continue to use Code 154 to report timing differences. Schedule 2: Deductions Continued

IT-40 Booklet 2023 Page 24 Exemptions Exemptions may be claimed on the Indiana return. Categories include exemptions for: 1. You, and your spouse, if married filing jointly 2. Certain dependents 3. Certain dependent children (additional) 4. Certain adopted children 5. Age 65 or older and/or blind 6. Additional age 65 or older (based on income) While you will need to complete Schedule 3 to list all of your exemptions, you will also need to complete Schedule IN-DEP if claiming any dependents. If you are claiming any adopted dependents, you will also need to complete Schedule IN-DEP-A. Schedule 3: Exemptions Line-by-line instructions. Line 1 – Exemptions for taxpayer, spouse (if married filing jointly) If you are married filing jointly, enter $2,000 on this line. All other filers* should enter $1,000 on this line. *Important. Enter $1,000 on this line even if you are claimed on someone else’s tax return, such as a parent or guardian. Lines 2 and 3 – Exemptions for dependents; Additional exemptions for certain dependent children Read the following information to see if you are eligible to claim any dependents. If you are, complete Schedule IN-DEP after reviewing these steps. • Step 1 Do You Have a Qualifying Child? • Step 2 Is Your Qualifying Child Your Dependent? • Step 3 Is Your Qualifying Relative Your Dependent? Step 1 Do You Have a Qualifying Child? A qualifying child is a child who is your… Son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew) AND, was… • Under age 19 at the end of the year and younger than you (or your spouse, if filing jointly), or • Under age 24 at the end of the year, a student (defined later), and younger than you (or your spouse, if filing jointly), or • Any age and permanently and totally disabled (defined later) AND, who… • Didn’t provide over half of his or her own support for the year (see Income Tax Information Bulletin #117), • Is not filing a joint return for the year, or is filing a joint return for the year only as a claim for refund of withheld income tax or estimated tax paid (see Income Tax Information Bulletin #117 for details and examples), • Lived with you for more than half the year. If the child didn’t live with you for the required time, see Exception to time lived with you, later. Caution. If the child meets the conditions to be a qualifying child of any other person (other than your spouse if filing a joint return) for the year, or the child was married, see Qualifying child of more than one person, later. Do you have a child who meets the conditions to be your qualifying child? Yes. Go to Step 2. No. Go to Step 3. Step 2 Is Your Qualifying Child Your Dependent? 1. Was the child a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico? (See Income Tax Information Bulletin #117 for the definition of a U.S. national or U.S. resident alien. If the child was adopted, see Exception to citizen test, later.) Yes. Continue. No. STOP. You cannot claim this child as a dependent. 2. Was the child married? Yes. See Married Person, later. No. Continue. 3. Could you, or your spouse if filing jointly, be claimed as a dependent on someone else’s tax return? See Steps 1 and 2. Yes. STOP. You cannot claim any dependents. No. You can claim this child as a dependent. See Schedule IN-DEP instructions below. Step 3 Is Your Qualifying Relative Your Dependent? A qualifying relative is a person who is your… • Son, daughter, stepchild, foster child, or a descendant of any of them (for example, your grandchild), or • Brother, sister, half brother, half sister, half brother, half sister, or a son or daughter of any of them (for example, your niece, or nephew), or • Father, mother, or an ancestor of sibling of either of them (for example, your grandmother, grandfather, aunt or uncle), or • Any other person (other than your spouse) who lived with you all of the year as a member of your household if your relationship does not violate local law. If the person did not live with you for the required time, see Exception to time lived with you, later. AND, who… • Was not a qualifying child (see Step 1) of any taxpayer during the year. For this purpose, a person isn’t a taxpayer if he or she isn’t required to file a U.S. income tax return and either doesn’t file such a return or files only to get a refund of withheld income tax or estimated tax paid. See Income Tax Information Bulletin #117 for details and examples. Schedule 3: Exemptions

IT-40 Booklet 2023 Page 25 • Had gross income of less than $4,400 during the year. If the person was permanently and totally disabled, see Exception to gross income test, later. AND, for whom … You provided over half of his or her support during the year. But see Children of divorced or separated parents, Multiple support agreements, and Kidnapped child, later. 1. Does any person meet the conditions to be your qualifying relative? Yes. Continue. No. STOP. You cannot claim this person as a dependent. 2. Was your qualifying relative a U.S. citizen, a U.S. national, U.S. resident alien, or a resident of Canada or Mexico? (See federal Publication 519 for the definition of a U.S. national or U.S. resident alien.) If your qualifying relative was adopted, see Exception to citizen test, later. Yes. Continue No. STOP. You cannot claim this person as a dependent. 3. Was your qualifying relative married? Yes. See Married person, later. No. Continue. 4. Could you or your spouse if filing jointly, be claimed as a dependent on someone else’s tax return this year? See Steps 1 and 2. Yes. STOP. You cannot claim any dependents. No. You can claim this person as a dependent. See Schedule IN-DEP instructions below. If you are eligible to claim one or more dependent from Step 2 and/or Step 3, complete Schedule IN-DEP. If one or more claimed dependent is adopted, see instructions for IN-DEP-A. Line 4 – Age 65 or Older or Blind If you and/or your spouse (if filing a joint return) are age 65 or older, you and/or your spouse can take an additional $1,000 exemption. If you and/or your spouse (if filing a joint return) are legally blind, you and/or your spouse can take an additional $1,000 exemption. Place an “X” in the boxes that apply to you and/or your spouse. Enter the total number of boxes marked on this line and multiply by $1,000. Line 5 – Additional Exemption for Age 65 or Older An additional $500 exemption is available for you and/or your spouse (if filing a joint return) if you are age 65 or older and the amount on Form IT-40, line 1, is less than $40,000 (or if you are married filing separately and the amount on Form IT-40, line 1 is less than $20,000). Place an “X” in the boxes that apply to you and/or your spouse. Enter the total number of boxes marked on this line and multiply by $500. Line 6 – Additional Exemptions for Adopted Child If you are claiming additional exemptions for one or more qualifying adopted children, enter the number of qualifying children listed on Schedule IN-DEP-A. Do not enter the number of boxes marked for parents. Schedule IN-DEP Instructions You must complete and enclose Schedule IN-DEP if you are claiming any dependents on lines 2 and/or 3 of Schedule 3. Question 1. Did you answer “No” to STEP 2, question 3 above? If so, you are eligible to claim the qualifying child (children) as a dependent. Read the Lines 1 through 4 instructions below. If not, skip to Question 2 below. Lines 1 through 4 For each qualified dependent child, enter his or her: • First and last name in Box A and Box B. • Nine-digit Social Security number (SSN) in Box C. • Date of birth in Box D. See Additional Dependent Exemptions below to determine whether or not to complete line E and line F. Example 1. Cooper and Grace Doe are eligible to claim their daughter Tatum as a dependent on Schedule IN-DEP. Here is how they will complete line 1: Dep. First Name Dep. Last Name 1A Tatum 1B Doe Dependent’s SSN Dependent’s DOB 1C 123 45 6789 1D 06 01 2012 Question 2. Did you answer “No” to STEP 3, question 4 above? If so, you are eligible to claim the qualifying relative as a dependent. For each qualified relative, enter his or her: • First and last name in Box A and Box B. • Nine-digit Social Security number (SSN) in Box C. • Date of birth in Box D. Example 2. Cooper and Grace Doe (see Example 1 above) are also eligible to claim Grace’s grandmother, Irene Smith, who lives with them, as a dependent. Here is how they will complete line 2: Dep. First Name Dep. Last Name 2A Irene 2B Smith Dependent’s SSN Dependent’s DOB 2C 987 65 4321 2D 10 15 1940 Line 5 Add the qualified dependents listed on lines 1 through 4, and enter the total in Box 5. Then, enter this amount in the box on Schedule 3, line 2. Schedule IN-DEP Instructions

IT-40 Booklet 2023 Page 26 Additional Dependent Exemptions Read below to see if you are eligible to claim an additional dependent exemption for a dependent child (children) listed on lines 1 through 4. An additional $1,500 exemption is allowed for certain dependent children. Carefully read the following Dependent child definition below to see if you are eligible for this additional exemption(s). If a taxpayer is claiming a child as a dependent for the first taxable year in which the additional dependent exemption is allowable for that child, the taxpayer is permitted to claim an amount of $3,000 instead of $1,500 for one tax year. This exemption is not permitted if the child could have been claimed for the $1,500 exemption in any previous year, regardless of whether the child had been claimed. Dependent child definition. According to state statute, to be eligible for this exemption a dependent child must be a son, stepson, daughter, stepdaughter, foster child*, child for whom you are a legal guardian, and/or your spouse’s child, if filing a joint return. He/she must be either under the age of 19 by the end of the tax year, or be a full-time student who is under the age of 24 by the end of the tax year. *The foster child must have lived with you the entire year in order to meet eligibility requirements for purposes of claiming the additional dependent exemption. If any dependent included in Box 5 on this schedule also meets the Dependent child definition above, place an “X” in box E on the line where the dependent is listed (see following example). In addition, if the dependent is eligible to be claimed for the additional child exemption for the first time, place an “X” in box F where the dependent is listed. Add the number of box E’s and box F’s containing an “X”. Enter that number in Box 6, which is located at the bottom of the schedule. Example 3. Cooper and Grace Doe (see Example 1 above) are eligible to claim the additional dependent exemption for their daughter Tatum. They should enter an “X” on Line 1E. Dep. First Name Dep. Last Name 1A Tatum 1B Doe Dependent’s SSN Dependent’s DOB 1C 123 45 6789 1D 06 01 2012 1E Additional dependent child exemption 1E X Note. Not all dependent children are eligible for this additional exemption. For instance, you may have included a grandson as a dependent in Box 5. However, if he doesn’t meet the qualification of being a foster child or a child for whom you are a legal guardian, you will not be able to claim the additional exemption for him on Box 6. Line 6 Add the number of any additional dependent child exemptions located in boxes 1E and 1F through 4E and 4F. Enter the total in Box 6. Then, enter this amount in the box on Schedule 3, line 3. Claiming more than four dependents If you are claiming more than four dependents, include an additional Schedule IN-DEP. Make sure to add the additional information to the totals on the first schedule, Boxes 5 and 6, where applicable. Example 4. June has five dependents. She entered information for her fifth dependent on line 1 on a second Schedule IN-DEP. She added the dependent claimed on the second schedule to the four claimed on the first schedule, and entered “5” on the first Schedule IN-DEP, Box 5. She made sure to include the second schedule with her filing. Likewise, she would include the fifth dependent in the total listed in Box 6 if the child listed on the second Schedule IN-DEP qualified for the additional dependent child exemption. Schedule IN-DEP-A Instructions You must complete and enclose Schedule IN-DEP-A if you are claiming any additional exemption for adopted children. These children are also required to be listed on Schedule IN-DEP. To claim this exemption for an adopted child, the adoption of the child must be finalized before the end of the taxable year. Lines 1 through 5 For each adopted dependent, enter his or her: • First and last name in Box A and Box B • Nine-digit Social Security number (SSN) in Box C • Date of birth in Box D • If the first listed taxpayer on the return is an adoptive parent of the child, check Box E • If the second listed taxpayer on the return is an adoptive parent of the child, check Box F Note. An adopted child can only qualify for the additional adopted child exemption if the child also meets the requirements for an additional child exemption on Schedule IN-DEP. If Box E on Schedule IN-DEP for the adopted child is not checked, the additional adopted child dependent exemption also will be disallowed. If both parents are adoptive parents of the child, only one additional adopted child dependent deduction is permitted for that child. This exemption may not be claimed by a non-adoptive parent (e.g., a biological parent of child adopted by a stepparent) unless the adoptive parent files a joint return with the non-adoptive parent. If you are claiming more than five additional adopted child exemptions, include an additional Schedule IN-DEP-A. Include the additional information to the total on the first schedule, Box 6, where applicable. Schedule IN-DEP-A Instructions

IT-40 Booklet 2023 Page 27 Definitions and Special Rules for Dependents Important. • Various Internal Revenue Service (IRS) forms and publications you may need can be found online at https://apps.irs.gov/app/ picklist/list/formsInstructions.html. • Indiana’s Income Tax Information Bulletin #117 can be found online at https://www.in.gov/dor/files/reference/ib117.pdf. Adopted child. An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption. Adoption taxpayer identification numbers (ATINs). If you have a dependent who was placed with you for legal adoption and you don’t know his or her SSN, you must get an ATIN for the dependent from the IRS. Get federal Form W-7A for details. If the dependent isn’t a U.S. citizen or resident alien, apply for an ITIN instead, using federal Form W-7. Children of divorced or separated parents. A child will be treated as the qualifying child or qualifying relative of his or her noncustodial parent (defined later) if all of the following conditions apply. 1. The parents are divorced, legally separated, separated under a written separation agreement, or lived apart at all times during the last 6 months of the year (whether or not they are or were married). 2. The child received over half of his or her support for the year from the parents (and the rules on Multiple support agreements, later, do not apply). Support of a child received from a parent’s spouse is treated as provided by the parent. 3. The child is in custody of one or both of the parents for more than half of the year. 4. Either of the following applies. a. The custodial parent signs federal Form 8332 or a substantially similar statement that he or she won’t claim the child as a dependent for the year, and the noncustodial parent maintains a copy of the signed federal Form 8332 with his or her records (as DOR can require this to be provided at a later date). If the divorce decree or separation agreement went into effect after 1984 and before 2009, the noncustodial parent may be able to include certain pages from the decree or agreement instead of federal Form 8332. See Post-1984 and pre-2009 decree or agreement and Post-2008 decree or agreement. b. A pre-1985 decree of divorce or separate maintenance or written separation agreement between the parents provides that the noncustodial parent can claim the child as a dependent, and the noncustodial parent provides at least $600 for support of the child during the year. If conditions (1) through (4) apply, only the noncustodial parent can claim the child for purposes of the dependency. Custodial and noncustodial parents. The custodial parent is the parent with whom the child lived for the greater number of nights in the year. The noncustodial parent is the other parent. If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher federal AGI. See Income Tax Information Bulletin #117 for an exception for a parent who works at night, rules for a child who is emancipated under state law, and other details. Post-1984 and pre-2009 decree or agreement. The decree or agreement must state all three of the following. 1. The noncustodial parent can claim the child as a dependent without regard to any condition, such as payment of support. 2. The other parent will not claim the child as a dependent. 3. The years for which the claim is released. The noncustodial parent must maintain with his or her records a copy of all of the following pages from the decree or agreement as DOR can require these to be provided at a later date. • Cover page (include the other parent’s SSN on that page). • The pages that include all the information identified in (1) through (3) above. • Signature page with the other parent’s signature and date of agreement. Post-2008 decree or agreement. If the divorce decree or separation agreement went into effect after 2008, the noncustodial parent cannot include pages from the decree or agreement instead of federal Form 8332. The custodial parent must sign either federal Form 8332 or a substantially similar statement the only purpose of which is to release the custodial parent’s claim to an exemption for a child, and the noncustodial parent must include a copy with his or her return. The form or statement must release the custodial parent’s claim to the child without any conditions. For example, the release must not depend on the noncustodial parent paying support. Release of exemption revoked. A custodial parent who has revoked his or her previous release of a claim to exemption for a child must maintain with his or her records a copy of the revocation as DOR can require this to be provided at a later date. For details, see federal Form 8332. Exception to citizen test. If you are a U.S. citizen or U.S. national and your adopted child lived with you all year as a member of your household, that child meets the requirement to be a U.S. citizen in Step 2, question 1. Exception to gross income test. If your relative (including a person who lived with you all year as a member of your household) is permanently and totally disabled (defined later), certain income for services performed at a sheltered workshop may be excluded for this test. For details, see Income Tax Information Bulletin #117. Exception to time lived with you. Temporary absences by you or the other person for special circumstances, such as school, vacation, business, medical care, military service, or detention in a juvenile facility, count as time the person lived with you. Also see Children of divorced or separated parents, earlier, or Kidnapped child, later. If the person meets all other requirements to be your qualifying child but was born or died during the year, the person is considered to have lived with you for more than half of the year if your home was this person’s home for more than half the time he or she was alive during the year. Any other person is considered to have lived with you for all of the year if the person was born or died during the year and your home was this person’s home for the entire time he or she was alive during the year. Definitions and Special Rules for Dependents

IT-40 Booklet 2023 Page 28 Foster child. A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. Kidnapped child. If your child is presumed by law enforcement authorities to have been kidnapped by someone who is not a family member, you may be able to take the child into account in determining the dependency exemption. For details, see Income Tax Information Bulletin #117. Married person. If the person is married and files a joint return, you cannot claim that person as your dependent. However, if the person is married but does not file a joint return or files a joint return only to claim a refund of withheld income tax or estimated tax paid, you may be able to claim him or her as a dependent. (See Income Tax Information Bulletin #117 for details and examples.) In that case, go to Step 2, question 3 (for a qualifying child) or Step 3, question 4 (for a qualifying relative). Multiple support agreements. If no one person contributed over half of the support of your relative (or a person who lived with you all year as a member of your household) but you and another person(s) provided more than half of your relative’s support, special rules may apply that would treat you as having provided over half of the support. For details, see Income Tax Information Bulletin #117. Permanently and totally disabled. A person is permanently and totally disabled if, at any time during the year, the person cannot engage in any substantial gainful activity because of a physical or mental condition and a doctor has determined that this condition has lasted or can be expected to last continuously for at least a year or can be expected to lead to death. Public assistance payments. If you received payments under the Temporary Assistance for Needy Families (TANF) program or other public assistance program and you used the money to support another person, see Income Tax Information Bulletin #117. Qualifying child of more than one person. Even if a child meets the conditions to be the qualifying child of more than one person, only one person can claim the child as a dependent. If you and any other person can claim the child as a dependent, the following rules apply: • If only one of the persons is the child’s parent, the child is treated as the qualifying child of the parent; • If the parents file a joint return together and can claim the child as a qualifying child, the child is treated as the qualifying child of the parents; • If the parents do not file a joint return together but both parents claim the child as a qualifying child, DOR will treat the child as the qualifying child of the parent with whom the child lived for the longer period of time during the year. If the child lived with each parent for the same amount of time, DOR will treat the child as the qualifying child of the parent who had the higher federal AGI for the year; • If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person who had the highest federal AGI for the year; • If a parent can claim the child as a qualifying child but chooses not to, the child is treated as the qualifying child of the person who had the highest federal AGI for the year, but only if that person’s federal AGI is higher than the highest federal AGI of any parent of the child who can claim the child. Example. You, your daughter and your mother live together. Your daughter meets the conditions to be a qualifying child for both you and your mother. Your daughter doesn’t meet the conditions to be a qualifying child of any other person, including her other parent. Under the rules just described, you can claim your daughter as a dependent. Your mother cannot claim your daughter. However, if your mother’s federal AGI is higher than yours and you do not claim your daughter as a dependent, your daughter is the qualifying child of your mother. For more details and examples, see Income Tax Information Bulletin #117. Social Security Number. You must enter each dependent’s 9-digit Social Security number (SSN) on Schedule IN-DEP, Box C. Be sure the name and SSN entered agree with the dependent’s Social Security card. Otherwise, we may disallow the exemption claimed for the dependent. If the name or SSN on the dependent’s Social Security card is not correct or you need to get an SSN for your dependent, contact the Social Security Administration. If your dependent child was born and died during the year and you do not have an SSN for the child, enter “Died” in Box C and keep a copy of the child’s birth certificate, death certificate, or hospital records as DOR can require you to provide these at a later date. The document must show the child was born alive. Example. Died If you apply for an ATIN or an ITIN on or before the due date of your 2023 return (including extensions) and the IRS issues you an ATIN or an ITIN as a result of the application, the IRS will consider your ATIN or ITIN as issued on or before the due date of your return. Student. A student is a child who during any part of 5 calendar months of the tax year was enrolled as a full-time student at a school, or took a full-time, on-farm training course given by a school or a state, county, or local government agency. A school includes a technical, trade, or mechanical school. It does not include an on-the- job training course, correspondence school, or school offering courses only through the Internet. Schedule 4: Other Taxes Line 1 – Use Tax on Internet, Mail Order and/or Out- Of-State Purchases If you have purchased items while you were outside Indiana, through the mail (for instance, by catalog or offer through the mail), through radio or television advertising and/or over the Internet, these purchases may be subject to Indiana sales and use tax, if sales tax was not paid at the time of purchase. This tax, called “use” tax, is figured at 7% (.07). Definitions and Special Rules for Dependents Continued

IT-40 Booklet 2023 Page 29 When you make purchases from a company in Indiana, that company is responsible for collecting the Indiana sales tax from you. When you make purchases from an out-of-state company, you are responsible for making sure the use tax is paid. Either the out-of-state company collects the tax from you, or you must pay the tax directly to the State of Indiana. Complete the worksheet below to figure your tax. If you paid sales tax to the state where the item was originally purchased, you are allowed a credit against your Indiana use tax for an amount paid up to 7%. Line 2 – Household Employment Taxes If you paid cash wages during 2023 to an individual who is not: • Your spouse, • Your child under age 21, • Your parent, • An employee under age 18; and the individual worked in and around your home as a baby-sitter, nanny, health aide, private nurse, maid, caretaker, yard worker or someone who does similar domestic duties, then that individual may be defined as your employee. See Federal Publication 926, Household Employer’s Tax Guide, for more information on how to define an employee. Visit www.irs.gov or call the IRS at 1-800-829-1040. If you paid cash wages of $2,200 or more to a household worker who is your employee, or total cash wages of $1,000 or more in any calendar quarter of 2022 or 2023 to all household employees, you may have withheld state and county income taxes. To pay these taxes on your Indiana income tax return, contact DOR for Schedule IN-H, or download one from www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. Line 3 – Recapture of certain Indiana offset credits Indiana requires the recapture of certain offset credits if certain conditions are met. Currently, these credits include the Indiana CollegeChoice 529 Education Savings Plan Credit and the Historic Building Rehabilitation Credit. • If contributions were made to an Indiana CollegeChoice 529 education savings plan in which you are the account owner and you made a non-qualified withdrawal(s) from this plan during the tax year, you will probably have to repay some or all of any credits previously claimed. • You may need to recapture some or all of the credits previously claimed for the Historic Building Rehabilitation Credit if you did not meet certain requirements. Complete and enclose Schedule IN-CR if you have an amount to be recaptured. Enter the total amount to be recaptured on line 3. Download Schedule IN-CR by visiting www.in.gov/dor/tax- forms/2023-individual-income-tax-forms. Schedule 5: Credits Lines 1 and 2 – Indiana State and County Tax Withheld If you are reporting any tax withheld on your behalf, report the Indiana state and local taxes on these lines. Report the state and county withholdings separately. Do not claim credit for taxes withheld for states other than Indiana or for localities outside Indiana. The amount of Indiana state tax withheld is usually shown in box 17 and the amount of and Indiana county tax withheld is usually shown in box 19 of your W-2s. Indiana state and county withholding amounts may also be present on other forms, including W-2Gs, various 1099s, Form IN MSID-A and Schedule IN K-1. You must enclose your withholding statements, including W-2s, W-2Gs, 1099s, Form IN MSID-A and Schedule IN K-1s, with your tax return to verify Indiana state and county taxes claimed as being withheld. Failure to enclose these withholding statements will result in a reduced refund or increase in the amount you owe. In addition to the withholding statements, you must also enclose Schedule IN-W. If you are filing a joint return, be sure to include your spouse’s withholding statements if they show Indiana state and/or county tax withholding amounts. Schedule 4: Other Taxes Continued Sales/Use Tax Worksheet List all purchases made during the tax year from out-of-state retailers. Column A Description of personal property purchased from out-of-state retailer Column B Date of purchase(s) Column C Purchase Price of Property(s) Magazine subscriptions: Mail order purchases: Internet purchases: Other purchases: 1. Total purchase price of property subject to the sales/use tax: enter total of Columns C............................................ 1 2. Sales/use tax: Multiply line 1 by .07 (7%)................................................................................................................... 2 3. Sales tax previously paid on the above items (up to 7% per item)............................................................................. 3 4. Total amount due: Subtract line 3 from line 2. Carry to Form IT-40, Schedule 4, line 1. If the amount is negative, enter zero and put no entry on Schedule 4, line 1...................................................................................................... 4

IT-40 Booklet 2023 Page 30 Important. The use of substitute W-2s will delay the processing of your return and may impact the issuance of any refund. A note about your withholding statements. It is important that any statement reporting withholding is readable. The state and county tax amounts withheld are verified on every withholding statement that comes in with your tax return. These amounts also should be reflected on Schedule IN-W. If you are not filing electronically, we encourage you to enclose the best copy available when you file. In some cases, verification of withholding may be delayed if the business withholding the tax is late filing copies of withholding statements. Line 3 – Pass Through Entity Tax Credit If you are claiming a credit for Indiana pass through entity tax, report the Pass Through Entity Tax (PTET) credited to you from Schedule IN K-1 or IT-41 Schedule IN K-1. You must include all Schedule IN K-1s reporting credit for PTET to verify the credit claim. Do not report PTET as withholding or estimated tax payments. Also, do not report PTET paid to another state or locality on this line. Line 4 – 2023 Estimated Tax Paid If you made estimated tax payments, enter the total paid for 2023 on this line. Also, include any extension payment made with Form IT-9 Extension of Time to File for tax year 2023. Note. Do not include on this line any estimated tax paid for tax year 2024. Line 5 – Unified Tax Credit for the Elderly This credit is no longer limited to a June 30 filing deadline. It may be claimed during the same time period as any other refundable credit. The tax return must be filed and credit claimed within three years of the filing due date (including extensions) to be eligible for a refund. This credit is available for certain low-income individuals who are age 65 or older. You may be able to claim this credit if you and/or your spouse meet all the following requirements: • You and/or your spouse must have been age 65 or older by Dec. 31, 2023, • If married and living together at any time during the year, you must file a joint return, • The amount on line 1 of Form IT-40 must be less than $10,000, • You must have been a resident of Indiana for at least six months during 2023, and • You must not have been in prison for 180 days or more in 2023. Note. Disabled persons under age 65 do not qualify for this credit. How should you file to claim the credit? You may claim the credit by filing the simplified Form SC-40* if your taxable income is low enough that you are not required to file Form IT-40. You will qualify if: • You are single or widowed and your income on line 1 of Form IT- 40 is less than $2,500; or • You are married with only one person age 65 or older and your income on line 1 of Form IT-40 is less than $3,500; or • You are married with both persons are age 65 or older and your income on line 1 of Form IT-40 is less than $5,000; • You have no other credits, such as withholding or estimated tax credits. *Form SC-40 can be found at www.in.gov/dor/tax-forms/2023- individual-income-tax-forms. No double benefit allowed. If you qualify to file Form SC-40 and do so, then do not also file Form IT-40 and claim the credit a second time. If you are required to file Form IT-40 you may claim the credit on Schedule 5, line 5. You can claim the credit on either Form IT-40 or Form SC-40, but file only one of these forms, and only file once. Important. • If your spouse died after Jan. 1, 2023, you can claim this credit by filing a joint return. • If a person dies and does not have a surviving spouse, then no one can claim the credit on behalf of the deceased person. To Figure Your Unified Tax Credit for the Elderly: Use Table A if: You meet all the requirements listed above, and: • You are filing a joint return, lived with your spouse during the tax year, both were Indiana residents for at least six months and both were age 65 or older by Dec. 31, 2023, or • Both you and your spouse met all the above-requirements and your spouse died after Jan. 1, 2023. Table A Joint Filers Both Age 65 or Older If the income on Line 1 of Form IT-40 is: Your Allowable Credit* is: less than $1,000..................................................................................$140 between $1,000 and $2,999................................................................. $90 between $3,000 and $9,999................................................................. $80 Use Table B if: You meet all the requirements listed above, and: • You are age 65 or older and are single or widowed, • You are filing a joint return and only one is age 65 or older, or • You are filing a joint return and only one was an Indiana resident for at least six months, or you are married but did not live with your spouse during the tax year, are age 65 or older and are married filing separately. Table B Only One Person Age 65 or Older If the income on Line 1 of Form IT-40 is: Your Allowable Credit* is: less than $1,000..................................................................................$100 between $1,000 and $2,999................................................................. $50 between $3,000 and $9,999................................................................. $40 *Once you have located your credit on Table A or Table B, enter that amount on line 5. Schedule 5: Credits Continued

IT-40 Booklet 2023 Page 31 Remember to file either Form SC-40 or Form IT-40, but not both. Line 6 – Indiana’s Earned Income Credit (EIC) If you are eligible for an earned income credit on your federal tax return, you may be eligible for Indiana’s earned income credit, too. Here are some important things to know: • You must be eligible for and have claimed an EIC on your federal tax return. If not, STOP. You are not eligible to claim Indiana’s EIC. • Your income on Form IT-40, line 1 (or Indiana’s Schedule A, line 36A), must be less than $63,398. If it is the same amount or more, STOP. You are not eligible to claim Indiana’s EIC. • Schedule IN-EIC must be completed and enclosed by all filers claiming the EIC. Your 2023 EIC will be your federal EIC multiplied by 10%. For the 2023 tax year, Indiana follows all requirements and allowances for the federal EIC. Line 7 – Lake County (Indiana) Residential Income Tax Credit You may be eligible to claim a Lake County (Indiana) Residential Income Tax credit if you meet all three of the following requirements. 1. You paid property tax to Lake County (Indiana) on your residence. Your “residence” is your principal dwelling. You must either own or be buying the residence under contract, and must pay property tax to Lake County (Indiana) on that residence. 2. Your Modified Indiana Adjusted Gross Income is less than $18,600. 3. You are not claiming the Homeowner’s Residential Property Tax Deduction on Indiana Schedule 2, line 2. If you are claiming this credit, make sure to see the Final Step after Worksheet B in the next column. Complete the following steps to see if you are eligible to claim this credit. Step 1 • Did you pay property tax to Lake County (Indiana) on your residence during the year? ☐ Yes ☐ No • If you answered “no,” STOP. You do not qualify for this credit. • If you answered “yes,” continue to Step 2. Step 2 1. First, prepare your state tax return (Form IT-40) through line 7. Enter amount from line 7 here...............................1 ___________ 2. Enter any Homeowner’s Residential Property Tax Deduction reported on Schedule 2, line 2.....2 ___________ 3. Modified Indiana AGI. Add lines 1 and 2, enter result here and continue to Step 3................3 ___________ Step 3 If you are filing as a single individual or as married filing jointly: • If the amount from Step 2, line 3 is greater than $18,599, STOP. You do not qualify for this credit. • If the amount from Step 2, line 3 is less than $18,000, go to Worksheet A to figure your credit. • If the amount from Step 2, line 3 is between $18,000 and $18,599, go to Worksheet B to figure your credit. If you are filing as a married individual filing separately: • If the amount from Step 2, line 3 is greater than $9,299, STOP. You do not qualify for this credit. • If the amount from Step 2, line 3 is less than $9,000, go to Worksheet C to figure your credit. • If the amount from Step 2, line 3 is between $9,000 and $9,299, go to Worksheet D to figure your credit. Worksheet A: Complete if the answer from Step 2, line 3 is less than $18,000 and you are filing as single or married filing jointly. A1 Enter the amount of Indiana

property tax you paid on your

Lake County residence.................................A1 $_ ____________ A2 Maximum credit............................................A2 $ 300 A3 Enter the smaller of A1 or A2. This is

your credit. Enter here and on Schedule 5,

line 7, and skip to the Final Step below.....A3 $_ ____________ Worksheet B: Indiana AGI Phaseout Complete if the answer from Step 2, line 3 is between $18,000 and $18,600 and you are filing as single or married filing jointly. B1 Allowable maximum Indiana AGI............. B1 $ 18,600 B2 Enter the amount from Step 2, line 3......... B2 $_ ____________ B3 Subtract B2 from B1 (if answer is zero

or a negative amount, STOP.

You do not qualify for this credit)............... B3 $_ ____________ B4 Multiply the amount on B3 by 0.5.

Round answer; see page 6 for

rounding instructions................................... B4 $_ ____________ B5 Enter the amount of Indiana property tax

you paid on your Lake County residence.... B5 $_ ____________ B6 Enter the smaller of B4 or B5. This is your

credit. Enter here and on Schedule 5, line 7,

and continue to the Final Step below.......... B6 $_ ____________ Worksheet C: Complete if the answer from Step 2, line 3 is less than $9,000 and you are a married individual filing separately. C1 Enter the amount of Indiana

property tax you paid on your

Lake County residence................................. C1 $_ ____________ C2 Maximum credit............................................ C2 $ 150 C3 Enter the smaller of C1 or C2. This is

your credit. Enter here and on Schedule 5,

line 7, and skip to the Final Step below..... C3 $_ ____________ Schedule 5: Credits Continued

IT-40 Booklet 2023 Page 32 Worksheet D: Indiana AGI Phaseout Complete if the answer from Step 2, line 3 is between $9,000 and $9,300 and you are a married individual filing separately. D1 Allowable maximum Indiana AGI.............D1 $ 9,300 D2 Enter the amount from Step 2, line 3.........D2 $_ ____________ D3 Subtract D2 from D1 (if answer is zero

or a negative amount, STOP.

You do not qualify for this credit)...............D3 $_ ____________ D4 Multiply the amount on D3 by 0.5.

Round answer; see page 6 for

rounding instructions...................................D4 $_ ____________ D5 Enter the amount of Indiana property tax

you paid on your Lake County residence....D5 $_ ____________ D6 Enter the smaller of D4 or D5. This is your

credit. Enter here and on Schedule 5, line 7,

and continue to the Final Step below..........D6 $_ ____________ Final Step Remember, you are not eligible to claim both the Homeowner’s Property Tax Deduction and the Lake County Residential Income Tax Credit in the same year. Therefore, if you are claiming this credit, make sure to remove any Homeowner’s Property Tax Deduction reported on Schedule 2, line 2. Lines 8 and 9: Economic Development for a Growing Economy Credit (EDGE); Economic Development for a Growing Economy Retention Credit (EDGE-R) If you have business income (including partnership or S corporation income) you may be eligible for one or both of these credits. These credits are available to businesses who conduct certain activities that are designed to foster job creation and/or job retention in Indiana. This credit is available to owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc. However, if all or part of your share of the credit is claimed by the pass-through entity, you may not claim the previously-claimed credit on your own behalf. Contact the Indiana Economic Development Corporation (IEDC), One North Capitol, Suite 700, Indianapolis, IN, 46204, for eligibility requirements, or visit iedc.in.gov for additional information. To claim these credits you must complete and enclose Schedule IN- EDGE or Schedule IN-EDGE-R, which are located online at www. in.gov/dor/tax-forms/2023-individual-income-tax-forms. The information to be reported on Schedule IN-EDGE or Schedule IN-EDGE-R is located on the Indiana Schedule IN K-1 or on the approved credit agreement letter from the IEDC. You must include the completed Indiana Schedule IN K-1 with your submission. Line 10 – Headquarters Relocation Credit (refundable portion) A business with annual worldwide revenue of $50 million, at least 75 employees (for credits awarded before July 1, 2022), and which relocates its corporate headquarters to Indiana may be eligible for a credit. The credit may be as much as 50% of the cost incurred in relocating the headquarters. Beginning with the 2022 tax year, this credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023- individual-income-tax-forms. Make sure to enclose this schedule with your tax filing. Some or all of this credit may be refundable. If the IEDC has ruled some or all of this credit to be refundable, enter on this line the refundable amount of the credit less the portion of the credit used to offset your tax liability. You must maintain the documentation provided to you that supports the refundable portion of this credit as DOR may request it. Caution. The combination of the headquarters relocation credit claimed here (offset amount) and on lines 29 through 31 (refundable amount) may not exceed the total of the credit that is available. See the instructions for the Headquarters Relocation Credit beginning on page 40. For more information (including limitations on the credit and the application process), see Income Tax Income Tax Information Bulletin #97, available at www.in.gov/dor/files/reference/ib97.pdf. This credit is administered by the IEDC. Contact them at One North Capitol, Suite 700, Indianapolis, IN 46204, via website at iedc.in.gov, or by phone at 317-232-8800. Line 11 – Adoption Credit You are eligible to claim an adoption credit on your state tax return if you claimed an adoption credit on your federal tax return. The amount of the credit is 20% of the federal credit allowed per child, or $2,500 per child, whichever is less. If you are claiming a credit because of a federal carryover of the adoption credit, the total credit allowable for the child is limited to $2,500. Federal adoption carryforward credit A carryforward credit claimed on federal Form 8839 may be allowed if it is from the preceding five tax years (2018, 2019, 2020, 2021 and/ or 2022).To figure the credit, use the Adoption Credit Worksheet on page 33. Use lines 6 through 30 if you are carrying forward a credit from a previous year. Complete only the lines applicable to the year(s) from which you are carrying forward a credit. If you are not claiming a credit based on any federal adoption credit carryforward, skip lines 6 through 30. See Income Tax Information Bulletin #111 at www.in.gov/dor/files/ reference/ib111.pdf for more information about this credit. Maintain with your records a copy of the federal Form 8839, federal Adoption Credit Carryforward Worksheets (if applicable), and federal Form 1040 as DOR can require you to provide this information at a later date. Line 12 – Reserved for Future Use Schedule 5: Credits Continued

IT-40 Booklet 2023 Page 33 Schedule 5: Credits Continued Adoption Credit Worksheet Child 1 Child 2 Child 3 1. First Name 2. Last Name 3. Year of Birth 4. Identification Number 5. Check if this child is NOT claimed as a dependent 6. Enter amount from 2018 Form 8839, line 11 $ $ $ 7. Enter the amount from 2018 Form 8839, line 12 $ $ $ 8. Divide line 6 by line 7; round answer to four decimal places 9. Enter the amount of 2018 carryforward credit used in 2023 (line 2 minus line 10 of the 2023 Adoption Credit Carryforward Worksheet from the Form 8839 instructions) $ $ $ 10. Multiply line 8 by line 9; round to nearest whole dollar. Enter this amount on line 36 $ $ $ 11. Enter amount from 2019 Form 8839, line 11 $ $ $ 12. Enter the amount from 2019 Form 8839, line 12 $ $ $ 13. Divide line 11 by line 12; round answer to four decimal places 14. Enter the amount of 2019 carryforward credit used in 2023 (line 3 minus line 12 of the 2023 Adoption Credit Carryforward Worksheet from the Form 8839 instructions) $ $ $ 15. Multiply line 13 by line 14; round to nearest whole dollar. Enter this amount on line 37 $ $ $ 16. Enter amount from 2020 Form 8839, line 11 $ $ $ 17. Enter the amount from 2020 Form 8839, line 12 $ $ $ 18. Divide line 16 by line 17; round answer to four decimal places 19. Enter the amount of 2020 carryforward credit used in 2023 (line 4 minus line 14 of the 2023 Adoption Credit Carryforward Worksheet from the Form 8839 instructions) $ $ $ 20. Multiply line 18 by line 19; round to nearest whole dollar. Enter this amount on line 38 $ $ $ 21. Enter amount from 2021 Form 8839, line 11 $ $ $ 22. Enter the amount from 2021 Form 8839, line 12 $ $ $ 23. Divide line 21 by line 22; round answer to four decimal places 24. Enter the amount of 2021 carryforward credit used in 2023 (line 5 minus line 16 of the 2023 Adoption Credit Carryforward Worksheet from the Form 8839 instructions) $ $ $ 25. Multiply line 23 by line 24; round to nearest whole dollar. Enter this amount on line 39 $ $ $ 26. Enter amount from 2022 Form 8839, line 11 $ $ $ 27. Enter the amount from 2022 Form 8839, line 12 $ $ $ 28. Divide line 26 by line 27; round answer to four decimal places 29. Enter the amount of 2022 carryforward credit used in 2023 (line 6 minus line 18 of the 2023 Adoption Credit Carryforward Worksheet from the Form 8839 instructions) $ $ $ 30. Multiply line 28 by line 29; round to nearest whole dollar. Enter this amount on line 40 $ $ $ 31. Enter amount from 2023 Form 8839, line 11 $ $ $ 32. Enter the amount from 2023 Form 8839, line 12 $ $ $ 33. Divide line 31 by line 32; round answer to four decimal places 34. Enter the amount from line 16 of Form 8839 reduced by the amount on line 13 of Form 8839. If less than zero, enter 0 $ $ $ 35. Multiply line 33 by line 34; round to nearest whole dollar. Enter this amount on line 41 $ $ $

IT-40 Booklet 2023 Page 34 Schedule 5: Credits Continued Adoption Credit Worksheet (continued) Child 1 Child 2 Child 3 36. Enter the amount on line 10 $ $ $ 37. Enter the amount on line 15 $ $ $ 38. Enter the amount on line 20 $ $ $ 39. Enter the amount on line 25 $ $ $ 40. Enter the amount on line 30 $ $ $ 41. Enter the amount on line 35 $ $ $ 42. Enter the sum of lines 36 through 41 $ $ $ 43. Multiply line 42 by 20% (0.20) $ $ $ 44. Enter $2,500 $ $ $ 45. Enter the sum of any previous Indiana adoption credits claimed for the child $ $ $ 46. Enter line 44 minus line 45. If less than zero, enter 0 $ $ $ 47. Enter the lesser of line 43 and line 46. Enter this amount on IT-40, Schedule 5, line 11, or IT-40PNR, Schedule F, line 11 $ $ $

IT-40 Booklet 2023 Page 35 Schedule IN-DONATE Each of the following funds has been assigned a three-digit code number. When listing your contribution on Schedule IN-DONATE under line 1, enter the name of the fund, the three-digit code number and the amount to be contributed. You may contribute all or a portion of your Form IT-40, line 16 overpayment to the following funds: • Indiana Nongame Wildlife Fund 200 The Indiana Wildlife Diversity Program offers you the opportunity to play an active role in conserving Indiana’s nongame and endangered wildlife. This program is funded through public donations to the Indiana Nongame Wildlife Fund. The money you donate goes directly to the protection and management of more than 750 wildlife species in Indiana - from songbirds and salamanders to state-endangered Trumpeter swans and spotted turtles. Enter both the name of the fund and the amount you wish to donate under line 1, and enter 200 as the designated 3-digit code number. Also, see the Limitation below. If you do not have an overpayment, but want to support the Wildlife Diversity Section, do not change your tax return. You may make a contribution online at www.in.gov/dnr/fish-and-wildlife/nongame- and-endangered-wildlife/donate-to-the-indiana-nongame-wildlife- fund. • Military Family Relief Fund 201 The Indiana Department of Veterans Affairs’ Military Family Relief Fund provides emergency grants to be used by military and veteran families. The funds can be utilized for needs such as food, housing, utilities, medical services, transportation, and other essential family support expenses which have become difficult to afford. The Military Family Relief Fund has helped more than 2000 families since its inception in 2007. Enter both the name of the fund and the amount you wish to donate under line 1, and enter 201 as the designated 3-digit code number. Also, see the Limitation below. If you do not have an overpayment, but want to support the Military Family Relief Fund, you may make a contribution by writing a check made payable to the Military Family Relief Fund and send it to the Indiana Department of Veterans Affairs, 302 W. Washington Street, Suite E-120, Indianapolis, IN 46204. Read more about this fund and other programs available for Hoosier veterans online at www.in.gov/dva. • Public K – 12 Education Fund 202 You may donate all or a portion of your overpayment to help fund public education for kindergarten through grade 12 in Indiana. Enter both the name of the fund and the amount you wish to donate under line 1, and enter 202 as the designated 3-digit code number. Also, see the following Limitation. Limitation The combination of the amounts you wish to donate to these funds cannot exceed the overpayment shown on Form IT-40, line 16. • If the total of the donations designated on this schedule is more than your available overpayment, the donation(s) will be reduced on a pro rata basis. For example, Sam wants to donate $20 to each fund, for a total of $60. His actual overpayment is $51. The donations to the three funds will be evenly reduced to $17 each. • If you entered a donation to one or more of these funds, and wish to apply some of your overpayment to next years estimated tax account, the overpayment will be applied first to the selected fund(s) and then to the estimated tax account. Any remaining overpayment will be refunded to you. For example, Aaron donated $100 to the Indiana Nongame Wildlife Fund, and is applying $50 to next year’s estimated tax account. His actual overpayment is only $110. The full $100 will be applied to the selected fund; the remaining $10 will be applied to next year’s estimated tax account. Schedule IN-W: Indiana Withholding Statements You must complete and enclose Schedule IN-W if you are reporting any tax withheld on your behalf and when filing your IT-40, IT- 40PNR or IT-40RNR by paper. Enter information from each withholding statement, including Form W-2, 1099, IN-MSID-A or Schedule IN K-1. If you have a withholding statement that withholds tax for multiple Indiana counties, enter the Indiana state income and Indiana state tax withheld once for that statement. Do not duplicate the Indiana state income and Indiana state tax withheld on multiple lines. Column A – Social Security Number Enter your or your spouse’s (if married filing jointly) social security number from your W-2, 1099, IN-MSID-A, IN K-1, or other form on which Indiana state and/or local tax withholding is reported for you or your spouse (if married filing jointly). Column B – Form Code Enter the appropriate form code listed on the Reference Chart provided at the bottom of this schedule. Leave blank if your W-2, 1099, or other federal form type is not listed or if your withholding is from IN-MSID-A or IN K-1. Column C – Employer or Payer Identification Number Enter the employer’s or State/payer’s identification number (ID). Column D – State Income Enter the amount of Indiana income. Column E – State Tax Withheld Enter the amount of Indiana State Tax withheld. Important. Complete Columns F, G, and H only if there is Indiana local withholding. Schedule IN-DONATE

IT-40 Booklet 2023 Page 36 Column F – Local Income Enter the amount of Indiana local income. Column G – Local Tax Withheld Enter the amount of County Tax withheld. Column H – Locality Code Enter the appropriate Indiana 2-digit county code. Refer to the back of Schedule CT-40, CT-40PNR or IT-40RNR for a list of county codes. Line 26 Add Column E, lines 1 through 25. Enter this total on line 1 of IT-40 Schedule 5, or line 1 of IT-40PNR Schedule F, or line 7 of IT-40RNR Line 27 Add Column G, lines 1 through 25. Enter this total on line 2 of IT-40 Schedule 5, or line 2 of IT-40PNR Schedule F, or line 8 of IT-40RNR. Note. You must enclose your W-2s, 1099s, IN-MSID-As, IN K-1s, or other forms reporting Indiana state or county tax withholding with this completed schedule. If you are reporting more than 25 withholding statements, complete and include additional Schedule IN-W as needed, but do not complete lines 26 and 27. On the first schedule, enter the total of state tax withheld (Column E) from all pages on line 26 and enter the total of local tax withheld (Column G) from all pages on line 27. Use these totals numbers on lines 1 and 2 of IT-40 Schedule 5 or IT-40PNR Schedule F, or lines 7 and 8 of IT-40RNR. Schedule 6: Offset Credits The following credits cannot be refunded; their purpose is to help reduce your state and/or county tax amounts due. See the Combined Limitation areas after the instructions for line 3 and line 7. Important. If you are claiming the credit from a pass through entity, include a copy of Schedule IN K-1 or IT-41 Schedule IN K-1. In addition, if you are reporting credits required to be reported in Schedule IN-OCC, do not list the credit directly on Schedule 6. Instead, report the credit on Schedule IN-OCC and carry the total amount from Schedule IN-OCC to Schedule 6, Line 7. Also, if you are claiming a credit carryforward from previous years, include the IN K-1 schedules from those years, if applicable. Line 1 – Credit for Local Taxes Paid Outside of Indiana If you figured county tax on Form IT-40, line 9, and had to pay a local income tax outside Indiana, you may be able to take a credit. This credit applies only if the tax you paid outside Indiana was to another city, county, town, or other local governmental entity; and they did not refund the tax, or give you a credit for Indiana county tax. The credit can be used to reduce your county tax liability. Carefully read instructions for Line B below. Complete lines A, B and C to figure your credit. A. Enter the amount of tax paid to the non-Indiana locality ..............................................A __________ B. Multiply the amount of income taxed by the non-Indiana locality by the rate from Schedule CT-40, line 2. Enter result here ............ B __________ C. Enter the amount of Indiana county income tax shown on Form IT-40, line 9 ............ C __________ The amount of the credit is the lesser of the amounts on A, B or C. Note. See the Combined Limitation page 37. Important. You must enclose either a copy of your W-2s or other withholding statements showing the non-Indiana locality amount withheld or a copy of the non-Indiana locality tax return. Remember, you can use this credit only if you have both: • A county tax amount on Form IT-40, line 9, and • A local income tax that you had to pay outside Indiana. Line 2 – Community Revitalization Enhancement District Credit A state and local income tax liability credit is available for a qualified investment made within a community revitalization enhancement district. The expenditure must be made under a plan adopted by an advisory commission on industrial development and approved by the Indiana Economic Development Corporation before it is made. The credit is equal to 25% of the qualified investment made by the taxpayer during the taxable year. This credit is available to owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc. It is nonrefundable and cannot be carried back. You may carry forward any excess credit to the next tax year. The allowable credit is the lesser of the available credit or the county tax due on line 9 of Form IT-40. Also, claim any unused amount (within certain limitations) on Schedule 6 under line 6 (see instructions for this credit on page 39). Contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, IN, 46204 for additional information. See the Restriction for Certain Tax Credits - Limited to One per Project below for additional limitations. Also, see the Combined Limitation below. Line 3 – Other Local Credits Currently, there are no other local credits available to be reported in this space. 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 subject to this limitation are the alternative fuel vehicle manufacturer credit, community revitalization enhancement district credit, enterprise zone investment cost credit, Schedule IN-W: Indiana Withholding Statements Continued

IT-40 Booklet 2023 Page 37 Hoosier business investment credit, industrial recovery credit, and the venture capital investment credit. For more information see Income Tax Information Bulletin #59 available at www.in.gov/dor/files/reference/ib59.pdf. Apply this restriction first when figuring your credits. Then apply the Combined Limitation. Combined Limitation There is one final limitation if you claim more than one credit on lines 1 through 3 of Schedule 6. These credits, when combined, cannot be greater than the county tax shown on Form IT-40 line 9; if they are, adjust the amounts before you enter them. See the following Order of Application and example for guidance. Order of Application First, use the credits which cannot be carried over and applied against your county tax in another year. This means apply any credit for local taxes paid outside Indiana first, then apply any community revitalization enhancement district credit. How to Adjust the Amount of Credit to be Entered (Example) Example. Megan is eligible to claim a $100 credit for local taxes paid outside Indiana plus a $200 Community Revitalization Enhancement District credit (CRED), for a $300 total amount in offset credits. Her county tax due (IT-40, line 9) is $160. Since her combined credits are more than her county tax due, she should reduce the last entry (the $200 CRED credit) by the $140 difference to $60. She will enter the full $100 credit for local taxes paid outside Indiana on Schedule 6, line 1, and the $60 limited CRED credit on line 3a. Note. Megan may use the $140 remaining CRED credit to offset any state adjusted gross income tax due on this year’s tax return (IT-40, line 8). See additional instructions for the CRED credit on page 39. Line 4 – College Credit If you donated money or property to an Indiana college or university, you may be able to take a credit of up to $100 on a single return or $200 on a joint return. To claim this credit you must complete and enclose Schedule CC-40. For additional information, see Schedule CC-40 at www.in.gov/dor/tax-forms/2023-individual-income-tax- forms and Income Tax Information Bulletin #14 at www.in.gov/dor/ files/reference/ib14.pdf. Important. You must maintain documentation of your contributions. DOR can require you to provide this information at a later date. Note. Tuition paid to a college or university is not a contribution, and does not qualify for this credit. See the Combined Limitation on page 44. Line 5 – Credit for Taxes Paid to Other States If you received income from another state while you were an Indiana resident, you must report that income on your Indiana income tax return. You may be able to take a credit for taxes paid to another state. If you had income from another state, and had to pay taxes to that state, read the following instructions carefully. If you were an Indiana resident during the tax year and had income from any of the states listed in Group A below, you should first find out what the other state’s rules are concerning the taxation of your income. Group A No Agreement (Credit taken on resident return) Alabama Louisiana New York Arkansas Maine North Carolina California Maryland North Dakota Colorado Massachusetts Oklahoma Connecticut Minnesota Rhode Island Delaware Mississippi South Carolina Georgia Missouri Utah Hawaii Montana Vermont Idaho Nebraska Virginia Illinois New Hampshire* Washington** Iowa New Jersey West Virginia Kansas New Mexico Any foreign countries or U.S. possessions * Capital gain, interest, and dividends only. ** Capital gains only. If you are personally subject to the District of Columbia Unincorporated Business Franchise Tax (D-30) on income that you received while you are an Indiana resident, you may claim a credit against your Indiana adjusted gross income tax for those taxes. Do not claim a credit for taxes paid to the District of Columbia from Form D-40. Note. If: • You are an owner or beneficiary of a partnership, S corporation, estate, trust, or similar pass-through entity; • The entity is subject to another state’s pass through entity tax enacted after 2017; and • The pass through entity tax is substantially similar to Indiana’s PTET; you are eligible to claim a credit for that other state’s pass through entity tax as if you paid the tax directly. In addition, if you have composite or withholding taxes paid by a pass through entity on your behalf, you are eligible for credit for those taxes as well. Group A Worksheet A. Enter the amount of tax paid to the other state. (This does not mean the tax withheld from your wages, but the actual tax figured on the other state’s return)..................................... A __________ B. Multiply the amount of income from the other state (that is subject to Indiana tax) by 3.15% (.0315).......................................................B __________ C. Enter the amount of Indiana state income tax shown on Form IT-40 line 8 ........................... C __________ Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 38 The lesser of the amounts on A, B or C is your allowable credit for taxes paid to other states. If you filed an income tax return with another state, you must provide a copy of that state’s income tax return. See Income Tax Information Bulletin #28 at www.in.gov/dor/files/reference/ib28.pdf for a list of acceptable documentation when a return is not filed with another state. Example. Ryan reported $10,000 Illinois-source wage income on the Illinois nonresident individual income tax return, and paid $300 tax to Illinois on that income. His Indiana state tax liability from line 8 of Form IT-40 is $870. He will enter the following information on the Group A Worksheet. A. $300 (tax paid to Illinois) B. $315 ($10,000 x .0315, tax due to Indiana) C. $870 (Form IT-40 line 8) Ryan’s credit is $300, which is the lesser of A, B and C. Example. Sarah owns an interest in a partnership. Her share of the partnership’s income is $100,000 and her share of the partnership’s bonus depreciation is $10,000. The partnership derived 40% of its income from Illinois sources, and Sarah paid $2,000 of state income tax to Illinois. Her Indiana state tax liability is $5,000. She will enter the following: A. $2,000 (tax paid to Illinois) B. $1,386 (($100,000 income +$10,000 bonus depreciation) *.4 (share of partnership income from Illinois sources) *.0315 (tax due to Indiana)) C. $5,000 (Form IT-40 line 8) Sarah’s credit is $1,386, the lesser of A, B, and C. Exception 1 – Gambling winnings from other states. If you’re not required to file another state’s income tax return to report gambling winnings from that state, enclose the W-2G issued for that state. Use the amount of state tax withheld by that state on Line A of the Group A Worksheet. Exception 2. If you are subject to state income tax on income from a non-United States country or territory that is not currently subject to tax in that country but will be, enclose the following information with your return: • The country or territory in which the income is subject to tax • The type of income (dividends, interest, etc.) • The amount of income • The reason the income is deferred by the country • The tax that will be due upon the income upon recognition by the foreign country • The credit for taxes paid to another state claimed on the income (include a computation similar to the Group A worksheet above). Group B Reciprocal Agreement (Wages, Salaries, Tips, and Commissions Only) Kentucky Ohio Wisconsin Michigan Pennsylvania If you were an Indiana resident during the tax year and had income from one of the states listed in Group B, you are covered by a reciprocal agreement. However, this agreement only applies to income from wages, salaries, tips and commissions. If you had other types of income from these states (such as business income, farm income, etc.), use the Group A Worksheet to figure your credit. Normally, employers in these states will withhold Indiana state tax from your wages because of the reciprocal agreement. However, if the state tax they withheld is not for Indiana, you must file a claim for refund with that state. You still have to include this income on your Indiana return and pay the Indiana tax. You’ll get some or all of the other state’s taxes back by filing a refund claim with them. Note. Winnings from Indiana riverboats and lotteries are not eligible for the reciprocal agreement. Caution. You may have to make estimated tax payments to Indiana. If the reciprocal state employer does not withhold Indiana withholding on your wage income, or does not withhold enough, see page 9 for information on how to figure and pay estimated tax. If you were a full-year resident of one of the reciprocal states and your income from Indiana was from wages, salaries, tips and commissions, you should file Form IT-40RNR, Reciprocal Nonresident Income Tax Return. If you were a resident of one of the reciprocal states and had other types of income from Indiana, or were a part-year Indiana resident, you will need to file Form IT-40PNR. Group C Reverse Credit (Credit taken on nonresident return) Arizona Oregon Washington D.C. If you were an Indiana resident during the tax year and had income from one of the states in Group C, you must pay Indiana tax on all your income. You will also need to file a nonresident return with the other state and claim a credit on their tax return for the Indiana tax paid. For Indiana residents who are subject personally to the District of Columbia Unincorporated Business Franchise Tax (D-30) on income that you received, please see the Group A instructions. Group D No State Income Tax (No credit allowed) Alaska South Dakota Texas Florida Tennessee Wyoming Nevada If you were an Indiana resident during the tax year and had income from one of the states in Group D, you are not allowed to claim this credit. These states do not have an income tax. You must file an Indiana resident return and pay Indiana tax on all your income. See the Combined Limitation on page 44. Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 39 Line 6 – Other Credits Each of the following credits has been assigned a three-digit code number. When claiming the credit on Schedule 6 under line 6, enter the name of the credit, the three-digit code number and the amount claimed. Airport Development Zone Credits The following credits have been repealed: Airport Development Zone Employment Expense Credit 800 Airport Development Zone Investment Cost Credit 801 Airport Development Zone Loan Interest Credit 802 However, any previously approved yet unused credit is available to be claimed. Enter the appropriate 3-digit code under line 6 if claiming any of these credits. See the Combined Limitation on page 44. Alternative Fuel Vehicle Manufacturer Credit 845 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Enter code 845 under line 6 if claiming this credit. See the Restriction for Certain Tax Credits – Limited to One per Project and the Combined Limitation on page 44 for additional limitations. Indiana’s CollegeChoice 529 Education Savings Plan Credit 837 You may be eligible for a credit for contributions made to Indiana’s CollegeChoice 529 education savings plan. Also, you may make contributions to this fund for Indiana K-12 education purposes. While there are many 529 college savings plans available both in Indiana and nation-wide, only contributions made to this specific CollegeChoice 529 Education Savings Plan are eligible for this credit. For 2023 and later, your may make a contribution before the regular due date of your 2023 tax return (April 15, 2024) and claim the credit for the contribution. However, if you claim a credit in 2023 for a 2024 contribution, you cannot claim a credit for that contribution on your 2024 return. For more information about this credit, see Income Tax Information Bulletin #98 at www.in.gov/dor/files/reference/ib98.pdf. This plan is administered through the Indiana Education Savings Authority. More information can be obtained online at www.in.gov/tos/iesa and at www.collegechoicedirect.com. See Schedule IN-529 at www.in.gov/ dor/tax-forms/2023-individual-income-tax-forms to figure your credit. This schedule must be enclosed when claiming the credit. Enter code 837 under line 6 if claiming this credit. See the Combined Limitation on page 44. Community Revitalization Enhancement District Credit 808 See the Schedule 6 line 3 instructions for details about this credit. This credit is available to offset both your state and local tax liabilities, and any unused remainder is available to be carried forward. Owners of pass-through entities are eligible for this credit. If you did not use all of the available community revitalization enhancement district credit on Schedule 6, line 3, the remaining credit should be claimed on this line. For more information, contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, IN, 46204, or visit their website at iedc.in.gov. Note. See the Restriction for Certain Tax Credits - Limited to One per Project and the Combined Limitation on page 44 for additional limitations. Enter code 808 under line 6 if claiming this credit. 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 non-refundable credit. This credit is administered by the IEDC. Contact them at One North Capitol, Suite 700, Indianapolis, IN 46204, via website at iedc.in.gov, or by phone at 317-232-8800. The approved credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. 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 IN K-1 with your records as DOR can require you to provide this information. About Enterprise Zone Credits Certain areas within Indiana have been designated as enterprise zones. Enterprise zones are established to encourage investment and job growth in distressed urban areas. Visit www.aiez.org/#mem to look up contact information for a particular enterprise zone. Sole proprietors who operate and/or invest in a business located in a zone and owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc., are eligible to claim the enterprise zone employment expense credit and/or the enterprise zone loan interest credit. Contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, IN, 46204, or visit their website at iedc.in.gov for more information about these credits. Enterprise Zone Employment Expense Credit 812 This credit is 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 the enterprise zone. For more information see Income Tax Information Bulletin #66 at www.in.gov/dor/files/reference/ib66.pdf and Indiana Schedule EZ, Parts 1, 2 and 3 at www.in.gov/dor/tax-forms/enterprise-zone- forms. Also, you may contact the Indiana Economic Development Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 40 Corporation, One North Capitol, Suite 700, Indianapolis, IN, 46204, call 317-232-8827, or visit their website at iedc.in.gov. Note. Schedule EZ must be enclosed if claiming this credit. Enter code 812 under line 6 if claiming this credit. Also, see the Combined Limitation on page 44. Enterprise Zone Investment Cost Credit 813 This credit is based on qualified investments made within Indiana. It can be up to a maximum of 30% of the investment, depending on the number of employees, the type of business and the amount of investment in an enterprise zone. For more information about this credit, see Income Tax Information Bulletin #66 at www.in.gov/dor/files/reference/ib66.pdf, contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, IN, 46204, or visit their website at iedc.in.gov. Note. See the Restriction for Certain Tax Credits - Limited to One per Project and the Combined Limitation on page 44 for additional limitations. Enter code 813 under line 6 if claiming this credit. Enterprise Zone Loan Interest Credit 814 This credit can be for up to 5% of the interest received from all qualified loans made before January 1, 2018, for use in an Indiana enterprise zone. For more information, and how to calculate this credit, see Income Tax Information Bulletin #66 at www.in.gov/dor/files/reference/ ib66.pdf and Indiana Schedule LIC at www.in.gov/dor/tax-forms/ enterprise-zone-forms. Note. Schedule LIC must be enclosed if claiming this credit. Contact the Indiana Economic Development Corporation, One North Capitol, Suite 700, Indianapolis, IN, 46204, call 317-232-8827, or visit their website at iedc.in.gov for additional information. Enter code 814 under line 6 if claiming this credit. Also, see the Combined Limitation on page 44. Ethanol Production Credit 815 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Enter code 815 under line 6 if claiming this credit. See the Combined Limitation on page 44 for additional limitations. 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. Note. Certification for this credit must be obtained from the Indiana Economic Development Corporation. See iedc.in.gov/indiana- advantages/investments/film-and-media-tax-credit for further information. This credit must be reported on Schedule IN-OCC, found at www. in.gov/dor/tax-forms/2023-individual-income-tax-forms. 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 Youth Trust Fund is also available. The credit is 50% of the donation made, 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. See www.in.gov/dor/tax-forms/ foster-care-credit-donation-information for further information regarding the application and approval process. This credit must be reported on Schedule IN-OCC, found at www. in.gov/dor/tax-forms/2023-individual-income-tax-forms. 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 818 Some or all of this credit may be available to be refunded. See below for more information. 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. 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 www.in.gov/dor/files/reference/ Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 41 ib97.pdf. This credit is administered by the IEDC. Contact them at One North Capitol, Suite 700, Indianapolis, IN 46204, via website at iedc.in.gov, or by phone at 317-232-8800. This credit must be reported on Schedule IN-OCC, found at www. in.gov/dor/tax-forms/2023-individual-income-tax-forms. Make sure to enclose this schedule with your tax filing. Submit a copy of the certificate from the IEDC verifying the amount of tax credit for the taxable year with the return. Otherwise, the credit will be denied. Enclose 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. See the Combined Limitation on page 44 for additional limitations. Important. If the IEDC has granted a refundable credit under the second test, see the instructions on page 32 for completing Schedule 5, line 10. Maintain the documentation provided to you that supports the refundable portion of this credit as DOR may request it. Historic Building Rehabilitation Credit 819 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Enter code 819 under line 6 if claiming this credit. See the Combined Limitation on page 44 for additional limitations. Important. The credit will need to be recaptured if, within five years of the completion of the project: • Ownership of the property, and/or • Additional modifications are undertaken to the property that do not meet required standards. Report any recapture on the Credit Recapture Schedule IN-CR, and Schedule 4, line 3, Recapture of certain Indiana offset credits. See instructions on page 29 for more information. Hoosier Business Investment Credit 820 This credit is for qualified investments, which include the purchase of new telecommunications, production, manufacturing, fabrication, processing, refining or finishing equipment. Owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc., are eligible for this credit. This credit is administered by the Indiana Economic Development Corporation (IEDC), One North Capitol, Suite 700, Indianapolis, IN, 46204. Visit the IEDC website at iedc.in.gov or call 317-232-8800 for additional information. Also, see Income Tax Information Bulletin #95 at www.in.gov/dor/ files/reference/ib95.pdf. Note. See the Restriction for Certain Tax Credits - Limited to One Per Project and the Combined Limitation on page 44 for additional limitations. The approved credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. 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 corporation, partnership, limited liability company, etc., make sure to keep Schedule IN K-1 with your records as DOR can require you to provide this information. Hoosier Business Investment Credit – Logistics 860 This credit is for qualified expenditures for certain logistics investments. Owners of pass-through entities are eligible for this credit. This credit is administered by the Indiana Economic Development Corporation (IEDC), One North Capitol, Suite 700, Indianapolis, IN, 46204. Visit the IEDC website at iedc.in.gov or call 317-234-4046, and get Income Tax Information Bulletin #95 at www.in.gov/dor/files/ reference/ib95.pdf for additional information. Note. See the Restriction for Certain Tax Credits - Limited to One Per Project and the Combined Limitation on page 44 for additional limitations. The approved credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. 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 IN K-1 with your records as DOR can require you to provide this information. Indiana’s Research Expense Credit 822 Indiana has a research expense credit that is similar to the federal credit for research and experimental expenses paid in carrying on your trade or business in Indiana. Owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc., are eligible to claim this credit. Enclose your Schedule IN K-1 to support your claim. If you are claiming the credit as a sole proprietor or as an owner of a disregarded entity such as a single-member LLC, a completed Form IT-20REC must be kept with your records as DOR can require you to provide this information. Get Form IT-20REC at www.in.gov/dor/tax- forms/2023-corporatepartnership-income-tax-forms. Enter code 822 under line 6 if claiming this credit. Also, see the Combined Limitation on page 44. Individual Development Account Credit 823 A credit is available for qualified contributions made to a community development corporation participating in an Individual Development Account (IDA) program. Owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc. may are eligible to claim this credit. The organization must have an approved program number from the Indiana Housing and Community Development Authority (IHCDA) before a contribution qualifies for pre-approval. Applications for the credit are filed through the IHCDA. S corporations and partnerships may take this credit and pass through the unused portion to their shareholders and partners. Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 42 To request additional information about the definitions, procedures and qualifications for obtaining this credit, contact: Indiana Housing and Community Development Authority, 30 S. Meridian St., Suite 1000, Indianapolis, IN 46204, telephone number 317-232-7777. Keep the approval certification from IEDC or letter of assignment with your records as DOR can require you to provide this information. Enter code 823 under line 6 if claiming this credit. Also, see the Combined Limitation on page 44. 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 owners of pass-through 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, IN 46204, call 317-232-8800, or visit their website at iedc.in.gov. Note. See the Restriction for Certain Tax Credits - Limited to One per Project and the Combined Limitation on page 44 for additional limitations. Enter code 824 under line 6 if claiming this credit. Military Base Investment Cost Credit 826 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. You must enclose approval certification from IEDC or a letter of assignment with your return. Enter code 826 under line 6 if claiming this credit. See the Combined Limitation on page 44 for additional limitations. Military Base Recovery Credit 827 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. You must enclose approval certification from IEDC or a letter of assignment with your return. Enter code 827 under line 6 if claiming this credit. See the Combined Limitation on page 44 for additional limitations. 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 IN K-1 reporting the claimed credit. The pass through 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. Natural Gas Commercial Vehicle Credit 858 This credit has sunset. No new credit will be allowed for vehicles placed in service after Dec. 31, 2016. However, any previously approved yet unused credit is available to be claimed. This carryforward credit is available to owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc. The carryforward portion of the previously approved credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax- forms/2023-individual-income-tax-forms. 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 IN K-1 with your records as DOR can require you to provide this information. Note. See the Combined Limitation page 44 for additional limitations. Neighborhood Assistance Credit 828 If you made a contribution or engaged in activities to upgrade areas in Indiana, you may be able to claim a credit for this assistance. Contact the Indiana Housing & Community Development Authority, Neighborhood Assistance Program, 30 S. Meridian, Suite 1000, Indianapolis, IN 46204, telephone number 317-232-7777 (800-872- 0371 outside Indianapolis), for more information. Owners of pass-through entities such as S corporations, partnerships, limited liability companies, etc., are eligible for this credit. Important. Do not report fees paid to your neighborhood association on this line. They are not eligible for this credit. Enter code 828 under line 6 if claiming this credit. Also, see the Combined Limitation on page 44. Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 43 New Employer Credit 850 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Enter code 850 under line 6 if claiming this credit. See the Combined Limitation on page 44 for additional limitations. Public School Educator Expense Credit 861 If you are an eligible educator working for an Indiana school corporation, you may be entitled to a credit for qualified expenses paid for certain classroom supplies. The credit can be as much as $100 ($200 if married filing joint and both spouses meet the requirements, but not more than $100 each). You are an eligible educator if, during the taxable year, you are employed as a Kindergarten -12 Indiana public school: • Teacher • Librarian • Counselor • Principal • Superintendent Public school means a school maintained by an Indiana school corporation, and includes charter schools. Private schools, parochial schools and homeschools are not public schools. Qualified expenses are amounts you paid or incurred during the tax year for certain classroom supplies, which include books, supplies, computer equipment (including related software and services), other equipment, and supplementary materials that you use in the classroom. For courses in health and physical education, expenses for supplies are qualified expenses only if related to athletics. Non-qualified expenses are certain expenses not allowed when figuring this credit. They include: • Certain expenses for professional development courses related to the curriculum, or to the students, that the educator teaches. • Protective items, such as face masks; disinfectant; hand soap; hand sanitizer; disposable gloves; tape, paint, or chalk to guide social distancing; physical barriers (for example, clear plexiglass); air purifiers; and other items recommended by the CDC to be used for the prevention of the spread of disease. Reimbursements. You must reduce your expenses for the qualified supplies by any reimbursements you received that were not included in box 1 of your Form W-2. Example 1. Jonah spent $40 for qualified supplies; he was reimbursed for $30 out of petty cash, none of which was included on his W-2. He will claim the $10 difference as a credit. Figure the credit. The amount of the credit is the lesser of: • The total amount paid for qualified supplies, less any reimbursements for those qualified supplies not included on line 1 of your W-2, or • $100. Example 2. Quincy is an 8th grade teacher at an Indiana public school. During the year he spent $314 for qualified supplies. He is eligible to claim a $100 credit. Example 3. Chris and Pat are employed as teachers at an Indiana public high school. They are filing a joint tax return. During the year Chris spent $74 for qualified supplies; Chris’s credit is $74. Pat spent $214 for qualified supplies; Pat’s credit is $100 (limited to the lesser of the amount Pat spent or $100). They will claim a $174 combined credit. Important. Make sure to keep a copy of the expense receipts used to figure this credit as DOR can require you to provide this information at a later date. Note. Claiming an educator expense deduction on your federal tax return in no way prohibits you from being eligible to claim this credit on your state tax return. Enter code 861 under line 6 if claiming this credit. See the Combined Limitation on page 44. Redevelopment Tax Credit 863 You 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, IN, 46204. Visit the IEDC website at iedc.in.gov or call 317-232-8800 for additional information. The approved credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. Make sure to enclose this schedule with your tax filing. Also, see the Combined Limitation on page 44. Residential Historic Rehabilitation Credit 831 A credit is available for the repair and rehabilitation of residential property that is listed on the Indiana Register of Historic Sites and Structures, is at least 50 years old, and will be used as your primary residence. All work must meet the Secretary of the Interior’s Standards for Rehabilitation of Historic Properties. For more information about this credit, see Income Tax Information Bulletin #87A at www.in.gov/dor/files/reference/ib87a.pdf. Also, contact the Indiana Department of Natural Resources, Division of Historic Preservation and Archaeology, 402 W. Washington St., Room W274, Indianapolis, IN 46204-2739; call 317-232-1646; or visit www. in.gov/dnr/historic-preservation. Enter code 831 under line 6 if claiming this credit. Also, see the Combined Limitation on page 44. Riverboat Building Credit 832 This credit has been repealed. However, any previously approved yet unused credit is available to be claimed. Enter code 832 under line 6 if claiming this credit. See the Combined Limitation below for additional limitations. Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 44 School Scholarship Credit 849 A credit is available for donations to certain scholarship-granting organizations (SGOs). 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, the department may round the credit down to the nearest dollar if the department receives information that the credit should be the amount as rounded down. While there are no limits to how much a donor can contribute to a qualified SGO, the entire tax credit program cannot award more than $18.5 million in credits per state fiscal year. To qualify for the credit, you must make a contribution to a scholarship granting organization that is certified by Department of Education. Visit the Indiana Department of Education’s website www.in.gov/doe/students/indiana-choice-scholarship-program for additional information. The approved credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023-individual-income-tax-forms. Make sure to enclose this schedule with your tax filing. Also, see the Combined Limitation below. 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, IN 46204, telephone number 317-232-8800, or visit iedc.in.gov. Beginning with the 2020 tax year, this credit must be reported on Schedule IN-OCC, found at www.in.gov/dor/tax-forms/2023- individual-income-tax-forms. Make sure to enclose this schedule with your tax filing. If you are claiming this credit as an owner of pass- through entity such as S corporation, partnership, limited liability company, etc., make sure to keep Schedule IN K-1 with your records as DOR can require you to provide this information. Note. See the Restriction for Certain Tax Credits - Limited to One per Project and the Combined Limitation below for additional limitations. 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, IN 46204. This credit must be reported on Schedule IN-OCC, found at www. in.gov/dor/tax-forms/2023-individual-income-tax-forms. Make sure to enclose this schedule with your tax filing. Apply online through the IEDC’s website at iedc.in.gov or call 317- 232-8800 for more information. Enclose the certification letter from the IEDC with the return, otherwise the credit will be denied. 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. Apply this restriction first when figuring your credits. Then apply the Combined Limitation below. Combined Limitation There is one final limitation if you have more than one credit to be entered on lines 4 through 7 of Schedule 6. These credits, when combined, cannot be greater than the state adjusted gross income tax shown on Form IT-40 line 8; if they are, adjust the amounts before you enter them. This includes any credits reported on Schedule IN-OCC, and carried to line 7 of Schedule 6. How to Adjust the Amount of Credit to Enter (Examples) Example. Miranda is eligible to claim both a $200 College Credit and a $300 Credit for Taxes Paid to Other States, for a $500 total amount of offset credits. Her state adjusted gross income tax due (IT-40, line 8) is $360. Since her combined credits are $140 more than her state tax due, she should reduce the last entry (the $300 Credit for Taxes Paid to Other States) by the $140 difference to $160. She will enter the full $200 College Credit on Schedule 6, line 4, and the $160 limited Credit for Taxes Paid to Other States on line 5. Example. Matthew has a $500 Indiana College Choice 529 Savings Plan Credit and a $600 Industrial Recovery Credit. His state adjusted gross income tax due (IT-40, line 8) is $700. He will report the full $500 Indiana College Choice 529 Savings Plan Credit on Schedule 6, line 6a, and enter $200 of the Industrial Recovery Credit on line 6b. He will carry the $400 remaining unused Industrial Recovery Credit over to next year’s tax return. Schedule 7: Additional Required Information Line 1 – Federal Filing Information You must place an “X” in the “yes” or “no” box to answer the question: “Are you filing a federal income tax return for 2023?” Line 2 – Out-Of-State Income Information If you and/or your spouse worked in Illinois, Kentucky, Michigan, Ohio, Pennsylvania and/or Wisconsin during 2023, complete this area. Enter the salary, wage, tip and/or other compensation income from those states in the appropriate boxes and the 2-digit code number for the appropriate state in the boxes. Find the 2-digit code number on the chart in the next column. Schedule 6: Offset Credits Continued

IT-40 Booklet 2023 Page 45 State Use Code # State Use Code # Illinois 94 Ohio 97 Kentucky 95 Pennsylvania 98 Michigan 96 Wisconsin 99 Note. This entry is for information purposes only, and will not change your refund or the amount you may owe. Line 3 – Extension of Time to File Information Place an “X” in the box on line 3a if you have a federal extension of time to file (you filed federal Form 4868, Form 2350, or made an online extension payment). Place an “X” in the box on line 3b if you have an Indiana extension of time to file (you filed Form IT-9 or made an online extension payment). Line 4 – Farmers and Fishermen Farmers and fishermen have special filing considerations. If at least two-thirds (2/3) of your gross income is from farming or fishing, mark the box provided on Schedule 7, line 4. This will make sure that a penalty for the underpayment of estimated tax is not assessed provided you have followed through by: • Paying all your estimated tax on or by Jan. 16, 2024, and filing your Form IT-40 by April 15, 2024, or • Filing your Form IT-40 by March 1, 2024, and paying all the tax due at that time. You are not required to make an estimated tax payment if you use this option. Important. If you have checked the box, you must keep the completed Schedule IT-2210 with your records as DOR may request it at a later date. Line 5 – Non- or Partially- Responsible Spouse Place an X in this box if you are a spouse who claims to not be liable for all or part of a tax liability because the remaining liability is that of the other spouse. You may be filing as a spouse who claims to not be liable for all or part of a tax liability if: • You have a tax liability reported on a joint return for which you are not responsible; • You have a tax liability reported on a joint return, but you are responsible only for a portion of the liability; or • You have received an assessment from the Indiana Department of Revenue and you are not liable for all or part of the assessment because the assessment arises from the tax attributable to your spouse. If filing as a non- or partially- responsible spouse who claims to not be liable for all or part of a tax liability, complete and submit Schedule IN-40PA (www.in.gov/dor/tax-forms/miscellaneous-individual- forms), along with any supporting documentation. Line 6 – Date of Death If the taxpayer and/or spouse died during 2023, and this return is being filed with his/her name on it, make sure to enter the month and day of death in the appropriate box. For example, a date of death of Jan. 9, 2023, would be entered as 01/09/2023. See instructions beginning on page 7 for more information. Note. If the taxpayer and/or spouse died before 2023, or after Dec. 31, 2023, but before filing his or her tax return, do not enter his/her date of death in this box. Line 7 – Telephone Number and Email Address Information If this is a joint return, both you and your spouse must sign and date the tax return. Please enter your daytime telephone number so we can call you if we have any questions about your tax return. Also, enter your email address if you would like us to be able to contact you by email. Personal Representative Information Typically, DOR will contact you (and your spouse, if filing jointly) if there are any questions or concerns about your tax return. If you wish to allow DOR to discuss your tax return with someone else (e.g. the person who prepared it, a relative or friend, etc.), you will need to complete this area. First, you must check the “Yes” box, which follows the sentence, “I authorize DOR to discuss my tax return with my personal representative.” Next, enter the name of the individual you are designating as your personal representative, that person’s telephone number, and that person’s complete address. If you complete this area, you are authorizing DOR to be in contact with someone other than you concerning information about this tax return. Note. If you are due a refund, it will be paid to you (and your spouse, if filing jointly) even if you designate a personal representative. You may decide at any time to revoke the authorization for DOR to speak with your personal representative. You will need to provide a signed statement indicating you revoke this authorization. Include your name, Social Security number and the year of your tax return. Mail your statement to Indiana Department of Revenue, P.O. Box 40, Indianapolis, IN 46206-0040. Paid Preparer Information Have your paid preparer complete this area (even if the paid preparer is the same individual designated as your personal representative). The paid preparer must provide: • The name of the firm that he/she represents, • The preparer’s tax identification number (PTIN), and • The firm’s address or his/her address if self-employed. Opt-Out Designation There are many benefits to electronic filing, which include: • Elimination of math errors • Faster refunds Paid preparers are required to electronically file all Indiana individual income tax returns if they prepare more than 10 tax returns annually. If you use a paid preparer and do not want your tax return to be filed electronically, you must complete a state Form IN-OPT. This form requires your signature (and your spouse’s, if filing jointly), and must be maintained by your paid preparer with his or her records. Get Form IN-OPT at www.in.gov/dor/tax-forms/2023-individual-income-tax- forms for more information. Schedule 7: Additional Required Information Continued

IT-40 Booklet 2023 Page 46 Make sure you keep a copy of your completed tax return, including all required enclosures, such as W-2s and schedules. Schedule IT-40NOL and Carryforward Worksheet A separate Schedule IT-40NOL must be used for each loss year. Indiana Code 6-3-2-2.5 and 6-3-2-2.6 allow for a net operating loss (NOL) deduction from Indiana adjusted gross income. All loss years ending after January 1, 2004, and any existing NOL(s) carried over to a taxable year after this date must be recomputed by applying the amended provisions of this Act. Deductions for net operating losses that were incurred in taxable years ending before January 1, 2004, and carried back or forward and deducted in taxable years ending before January 1, 2004, are calculated under the law in effect for the year the NOL was incurred. For tax years 2021 and later, itemized deductions are not permitted in determining Indiana net operating losses. In addition, if you have a net operating loss carryforward that was calculated in whole or in part using an itemized deduction, you must recalculate the net operating loss without the itemized deduction in order to determine the amount to be carried forward. Important. In order to carry a pre-2004 Indiana NOL to tax year 2004 and beyond, you must: • Step 1. Refigure the NOL using the new method on Form IT- 40NOL revised R3/10-04, or after; • Step 2. Reduce the refigured NOL by any amount previously used in any pre-2004 intervening year;* • Step 3. Use any remaining NOL on line 17 of Carryforward Worksheet 2. * The application of the NOL in the pre-2004 tax year(s) must conform with the rules that govern those years. Do not refigure the amount of deduction used in the pre-2004 tax years. When to use an Indiana NOL Carryback and carryforward years. Public Law 172-2011 amends IC 6-3-2-2.5 and IC 6-3-2-2.6. It provides that no Indiana net operating loss carryback claim may be filed after Dec. 31, 2011. Example. Paul has an Indiana NOL for the 2010 tax year. Paul did not file an Indiana NOL carryback claim before Jan. 1, 2012. Therefore, he will have to carry the loss forward. Note. This rule will have no impact on carryback claims filed before Jan. 1, 2012. Example. Ross has a $200,000 Indiana NOL for the 2010 tax year. In October of 2011 he carried this loss back to his 2008 and 2009 Indiana returns. He used $75,000 of the loss in 2008, and $100,000 of the loss in 2009. He has a $25,000 loss available to be carried to tax year 2011. Indiana NOLs may be carried forward for up to 20 years following the loss year (HEA 1316-2018(ss), Sec. 5). Note. If you potentially had a net operating loss for 2018 through 2021, please see the specific modifications for Line 2 related to those years and later. Part 1 – Computation of Indiana NOL Enter the loss year (this is the year in which the NOL occurred). P.L. 81-2004, effective January 1, 2004, provides for an NOL deduction from Indiana adjusted gross income equal to the amount of a federal NOL, computed under IRC Section 172, for the taxable year, that is derived from sources from within Indiana, and adjusted for modifications under IC 6-3-1-3.5. The federal NOL for individuals, which reflects the IRC Section 172 application, is computed on federal Schedule A from Form 1045. Note. The use of Indiana modifications may result in an Indiana net operating loss even if there is no federal NOL. Line 1. Enter your adjusted gross income from Line 1 of Form IT-40. Line 2. Enter the sum of certain Indiana add-backs and deductions here. The amount will be the 100-code add-backs minus the 600 code deductions. For years before 2023, the 100-series codes listed below will be reported on Line 2 of the IT-40NOL and the 600-series codes will be reported on Line 5 of the IT-40NOL. Please note the years specified for each code. If no year is listed, the modification is required for all years. • Tax add-back – 100 • Net operating loss carryforward – 101 • Lump sum distribution – 102 (2003-2015 only) • Section 179 expense – 105 • Bonus depreciation – 104 • Unemployment compensation – 106 (2009 only) • Deferral of business indebtedness discharge and reacquisition – 107 (2009-present) • Qualified disaster assistance property – 110 (2009-present) • Qualified refinery property – 111 (2009-present) • Qualified restaurant property – 108 (2009-present) • Qualified film or television production – 112 (2009-present) • Qualified preferred stock – 113 (2009-present) • Qualified retail improvement property – 109 (2009-present) • Educator expense – 124 (2010-2012) • Employer-provided educational expenses – 125** (2010-2012) • IRA charitable distribution – 122** (2010-2012) • Qualified transportation fringe expenses – 127** (2010-2012) • Student loan interest – 128** (2010-2012) • Tuition and fees – 123**(2010-2012) • Discharge of debt of a principal residence – 117 (2010-2015) • Motorsports entertainment complex – 130** (2010-present) • Qualified advance mining safety equipment – 126** (2010-present) • Qualified environmental remediation costs – 121** (2010-present) • Qualified leasehold improvement property – 129** (2010-present) • Start-up expenditures – 131** (2010-present) Schedule IT-40NOL Instructions

IT-40 Booklet 2023 Page 47 • Certain trade or business deductions based on employment of unauthorized alien – 132 (2011-2015) • OOS municipal obligation interest – 137 (2012-present) • Federal Repatriated Dividend Deduction Add-Back – 139 (2017-present) • Excess federal interest (under IRC Section 163(j)) – 142 (2018-present) • Student loan payments made by an employer and excluded from federal gross income, net of interest that would have been permitted for federal purposes absent the federal exclusions – 148 • Student loan debt discharged under IRC section 108(f)(5) except those excluded as a result of death, total and permanent disability, or bankruptcy – 150 (2021-present) • 50% of certain meals deducted in determining AGI – 149 (2021-present) • Modifications for Excess Business Losses – 151 (2023) • Modifications from Excess Inclusion Income – 153 (2023) • Specified Research and Experimental Expenses Add-Back – 154 (2023) • Non-Indiana locality earnings deduction – 614 (2003-2015) • Homeowner’s residential property tax deduction - 604 • State tax refund and/or other recovered itemized deductions – 618 • Interest from U.S. government obligations – 610 • Social Security and/or benefits issued by the U.S. Railroad Retirement Board – 624 • Indiana partnership long-term care policy premiums deduction – 608 • Human services deduction – 605 • Qualified patent income exemption – 622 (2009-present) • National Guard and reserve component member’s deduction – 621 (2009-present) • Nonresident military spouse earned income deduction – 625 (2009-present) • Government or civic group capital contribution deduction – 633 (2018-present) • COVID-related ERC expense deduction – 634 (2021-present) • Indiana education scholarship account grant deduction – 635 (2021-present) • Indiana enrichment scholarship account deduction – 638 (2022-present) • Student loan interest deduction for interest paid from student loan payments required to be added back – 637 (2022-present) • Small Employer Health Insurance Premium Deduction – 639 (2023) • Specified Research and Experimental Expenses Deduction – 641 (2023) • Indiana career scholarship account deduction – 642 (2023) • Any other modification reported using Code 120 or Code 147 (2010-present for 120, 2020-present for 147). This includes: ο Excess business losses permitted for federal purposes but not Indiana purposes (2018-2020) ο Charitable contributions deductions claimed by individuals in determining federal AGI – (2020 only) ο Unemployment excluded from federal gross income (2020 only) ο Any late-added modifications listed in this list for 2021 to present but which were required or permitted for 2020. Note. Prior to completing line 3, you will need to complete Schedule A of IRS Form 1045. Line 3. Add the following amounts from IRS Form 1045, Schedule A and enter on line 3: • Line 9 minus any itemized or standard deductions included in line 6, but not less than zero. • Line 17 • Line 21 • Line 22 Line 4. Enter the total of lines 1 through 3. If this number is greater than zero, enter 0. Line 5. If you have a federal excess business loss for the current year, enter your excess business loss from IRS Form 1040, Schedule 1, line 8p as a negative number. If you have a federal net operating loss for the current year after determining excess inclusion income, enter the portion of federal net operating loss that equals your excess inclusion income as a negative number. If you have current-year Indiana net operating losses from estate or trust terminations, enter those losses as a negative number. Do not include any net operating losses carried forward from prior years. Note. If you have a deduction permitted as part of your federal net operating loss but not deducted in determining federal adjusted gross income, such as a federal itemized deduction, enter the net operating loss determined as if that deduction was disallowed for federal purposes. Line 6. If you have a Code 151 or Code 153 adjustment, include that adjustment on this line. If Code 151 is a negative number, enter that amount as a positive number on line 6. If Code 153 is a negative number, enter that amount as a positive number on line 6. Line 7. Add lines 5 and 6. If line 7 is greater than 0, enter zero. Line 8. Add lines 4 and 7. If this number is negative, this is your net operating loss available for carryforward. If this number is zero, you do not have a net operating loss. Part 2 – Record of Indiana NOL Application Column 1. List the year(s) to which you are carrying the loss. Column 2. Enter the amount of Indiana AGI available to be offset from line 5 of the completed Carryforward Worksheet. Column 3. Enter as a positive amount the Indiana NOL available for deduction from line 6 of the completed Carryforward Worksheet. Column 4. Enter the amount from either line 7 or line 8 of the Carryforward Worksheet (only one of those lines will have an entry). Column 5. Enter the amount from line 9 of the completed Carryforward Worksheet. This is your Indiana NOL deduction. Enter on IT-40 Schedule 1 (Schedule 2 for the 2009 tax year and beyond), under line 11, or IT-40PNR Schedule B (Schedule C for the 2009 tax year and beyond), under line 11. If carrying the loss forward to a tax year which has already been filed, enter the amount on Form IT-40X, line 1, Column B. Schedule IT-40NOL Instructions Continued

IT-40 Booklet 2023 Page 48 Schedule IT-40NOL Carryforward Worksheet A Carryforward Worksheet must be completed for each loss year. If you are carrying your loss forward for more than five years, modify the top of the column to show the year to which it is being carried. Example. Modify Column A, ‘1st’ following year, to read ‘6th’ following year. Before you begin. You must have a completed state tax return (not including the Indiana NOL deduction) for the intervening year(s) in which you are applying the loss. Columns A – E. Enter in Column A information from the first year following the loss year. Enter in Column B information from the second year following the loss year. Complete the remaining columns accordingly. Example. The loss year is 2009. Column A should reflect information from tax year 2010; Column B should reflect information from tax year 2011, and so on. Intervening year. Year to which a loss is being carried. Complete lines 1 through 5 of the Carryover Worksheet to figure the intervening year’s Indiana AGI. Line 1. Enter the amount from line 1 of the intervening year’s IT-40 or IT-40PNR. Note. If reporting from the IT-40PNR for tax year 2008 or before, skip line 2 and enter this amount on line 3. Line 2. Net the following Indiana add-backs as reported on the intervening year’s return. For tax years 2003 and beyond, add the 100-series modifications applicable for the taxable year. See the instructions for Line 2 of the IT- 40NOL for a list of modifications. If you reported any of the above on your 2012 tax return, and you utilized Option 2 to report them as a negative add-back on your 2013 return (using a 300-series 3-digit code number in lieu of filing an amendment for 2012), do not include these amounts on line 2 when 2013 is the intervening year. Line 3. Add lines 1 and 2 and enter the result here. Line 4. Enter the net of certain deductions as claimed on the intervening year’s return. These are the 600-code deductions listed in Part 1, line 2, along with the total exemptions claimed. Line 5 – Intervening year’s Indiana AGI. Subtract line 4 from line 3 (if less than zero, enter zero). Line 6. NOL available for carryforward. Enter here the amount from Schedule IT-40NOL, Part 1, line 8 (enter as a positive amount). • If this is the first time the NOL from Schedule IT-40NOL, Part 1, line 8, is being used, then enter the full amount here. • If you have already used the NOL from Schedule IT-40NOL, Part 1, line 8, to offset income, then enter the remaining available loss here (from line 8 of the Carryforward Worksheet). See line 8 instructions. Note. If you have a debt that was discharged by a Title 11 bankruptcy, a debt that was discharged while you were insolvent, or a discharged debt that was qualifying farm indebtedness, you will be required to reduce your net operating losses available for carryforward. Your loss reduction will equal the amount of the indebtedness listed above minus any portion of the indebtedness applied against basis, capital loss, and passive loss/credit attributes. This reduction is to be applied first against the current year net operating loss, then against loss carryforwards in the order in which they were incurred, from oldest to newest. Complete line 7 OR line 8 based on the following: • If line 5 is greater than line 6, complete line 7. • If line 6 is greater than line 5, complete line 8. Line 7. If the line 5 intervening year’s Indiana AGI is greater than or equal to the line 6 NOL available for carryforward, then you will use all of the available NOL as a deduction. Subtract line 6 from line 5 and enter the difference here. Skip line 8 and complete line 9. Line 8. If the line 6 NOL available for carryforward is greater than the line 5 intervening year’s Indiana AGI, then you will be able to offset the entire intervening year’s Indiana AGI and have a reduced NOL available to carry to other years. Subtract line 5 from line 6 and enter the difference here and on line 6 in the next column. Line 9. Enter the smaller of the amount on line 5 or line 6. This is your Indiana NOL deduction. Enter on IT-40 Schedule 1 (Schedule 2 for the 2009 tax year and beyond), under line 11, or IT-40PNR Schedule B (Schedule C for the 2009 tax year and beyond), under line 11. If carrying the loss forward to a tax year which has already been filed, enter the amount on Form IT-40X, line 4, Column B. County Tax Instructions If you live or work in an Indiana county as of January 1 of the tax year, you will probably owe county tax. Complete the county tax Schedule CT-40 to figure if you do owe, and how much it will be. County Where You Lived Defined The county where you lived is the county where you maintained your home on Jan. 1, 2023. If you had more than one home in Indiana on this date, then your county of residence as of Jan. 1, 2023, was: • Where you were registered to vote. If this did not apply, then your county of residence was • Where your personal automobile was registered. If this did not apply, then your county of residence was • Where you spent the majority of your time in Indiana during 2023. Enter the county two-digit code for the county where you lived on Jan. 1, 2023, in the area beneath the name and address area on Form IT-40. Find your county two-digit code number on the back of Schedule CT-40. County Tax Instructions

IT-40 Booklet 2023 Page 49 Did You Move During the Year? If you moved your residence to a different Indiana county during the year, but after Jan. 1, 2023, the county where you lived for tax purposes will not change until next year. Example. William was a lifelong Scott County resident until he moved to Martin County on March 15, 2023. He will figure Scott County tax when filing his 2023 state tax return (he lived there on Jan. 1, 2023). If he still lived in Martin County on Jan. 1, 2024, he will figure Martin County tax when filing his 2024 state taxes. County Where You Worked Defined The county where you worked (county of principal employment) is the county where your main place of business was located or where your main work activity was performed on Jan. 1, 2023. If you began working in another county after Jan. 1, 2023, the county where you worked for reporting purposes will not change until next year. Enter the two-digit code number for the county where you worked in the area beneath the name and address area on Form IT-40. Example. Jessie worked in Marion County on Jan. 1, 2023. She quit that job and began a new one in Johnson County on Feb. 10, 2023. She will enter the Marion County two-digit code (49) as the county where she worked even though she changed jobs during the year. If you had more than one job on Jan. 1, 2023, your principal place of employment is the job where you worked the most hours and earned the most income. If, on Jan. 1, 2023, your county of principal employment was not in Indiana, write county code “00” (out-of-state) in the County Where You Worked box on the front of the IT-40. Exception. If you worked in any of the following states on Jan. 1, 2023, enter their two-digit code number (instead of 00): State Use Code # State Use Code # Illinois 94 Ohio 97 Kentucky 95 Pennsylvania 98 Michigan 96 Wisconsin 99 Military Personnel If you were stationed in Indiana, your county of residence is the county where you lived on Jan. 1 of the year you entered the military service. If, on Jan. 1, 2023, you were single and stationed outside Indiana, or you were stationed outside Indiana and your family was with you, write county code “00” (out-of-state) in all the county boxes on Form IT-40 (you won’t owe a county tax). If, however, you maintained your home in an Indiana county and/or your spouse and family were still living in an Indiana county on Jan. 1, 2023, you are considered to be a resident of that county and will be subject to county tax. Retired Persons, Homemakers or Unemployed If you were retired, a homemaker, or were unemployed on Jan. 1, 2023, put your county of residence two-digit code number in both the Indiana County where you lived and Indiana County Where You Worked boxes on Form IT-40. Do not write the word “Retired,” “Homemaker” or “Unemployed” over the boxes. Special Note to Married Taxpayers Filing a Joint Return If you lived in different counties on Jan. 1, 2023, both of you need to figure your county tax separately. See Schedule CT-40 Line 1 Instructions below for details on how to do this. Schedule CT-40: Line-by-Line Instructions Line 1 If you: • Are filing a single return, enter on line 1A the amount from Form IT-40, line 7. • Are filing a joint return and you both lived in the same county on Jan. 1, 2023, enter on line 1A the amount from Form IT-40, line 7. Leave Column B blank. • Are filing a joint return and you lived in different counties on Jan. 1, 2023, enter each person’s share of the amount reported on line 7 of Form IT-40. See how to do this in the following example. Following are two examples for when a taxpayer and spouse file married filing jointly but live in different counties on January 1 of the tax year. Example. Jacob and Becca married in 2023 and are filing a joint return. On Jan. 1, 2023, Jacob lived in Greene County and Becca lived in Clay County. Their individual share of the $39,080* amount reported on line 7 of their IT-40 is to be reported on Schedule CT-40 between Column A and Column B in the following way: Breakdown Column A Jacob Column B Becca IT-40 Line 7 Wages 23,000 21,000 44,000 Interest (joint account) + 40 + 40 + 80 Renter’s deduction - 1,500 -1,500 -3,000 Subtotal 21,540 19,540 41,080 Exemption -1,000 -1,000 -2,000 Totals 20,540 18,540 39,080* Jacob will enter $20,540 on line 1A and Becca will enter $18,540 on line 1B. Use of exemptions when separating income. Each spouse must use their own: • Personal $1,000 exemption (included on Schedule 3, line 1), • Age 65 or older exemption (included on Schedule 3, line 4), • Age additional age 65 exemption (included on Schedule 3, line 5), when figuring their share of net income subject to county tax. Additional exemptions for dependents should be divvied up in whole* County Tax Instructions Continued

IT-40 Booklet 2023 Page 50 in a way that provides the most benefit to the individuals. This usually results with the individual with the higher county tax rate using all of the dependent exemptions when figuring county tax. *Exemptions must be used in whole. For example, a $1,000 exemption may not be separated into $700 to be used by one spouse, with the remaining $300 to be used by the other spouse. The full $1,000 must be used by one spouse only. Note. The total amount of exemptions used to reduce income may not be greater than the total amount of exemptions reported on Schedule 3, line 6. Example. Sam and Molly married in 2023 and are filing a joint return. On Jan. 1, 2023, Sam lived in County A, which has a resident county tax rate of .01. Molly lived in County B, which has a resident county tax rate of .025. They claim their three-year old son Sebastian as a dependent. Their total exemptions are $4,500 ($1,000 each for Sam, Molly and Sebastian, plus the $1,500 additional dependent exemption for Sebastian). Sam’s wage income is $49,000; Molly’s is $45,000. They claimed a $2,500 homeowner’s property tax deduction. Molly will use all of the exemptions except for Sam’s $1,000 personal exemption when figuring her share of income subject to county tax since she has the higher county tax rate. Their individual share of the $87,000* state taxable income reported on line 7 of their Form IT-40 is to be reported on Schedule CT-40 between Column A and Column B in the following way: Breakdown Column A Sam Column B Molly IT-40 Line 7 Wages $49,000 $45,000 $94,000 Property tax deduction -1,250 -1,250 -2,500 Subtotal $47,750 $43,750 $91,500 Exemptions -1,000 -3,500 -4,500 Totals $46,750 $40,250 $87,000* Sam will enter $46,750 on line 1A and Molly will enter $40,250 on line 1B. County Tax Instructions Continued Line 2 Find the county where you lived on Jan. 1, 2023, on the 2023 Indiana County Income Tax Rates and County Codes chart located on the back of Schedule CT-40. Find the County Tax Rate on that county row and enter it here. If you are filing a single return or a joint return where you both lived in the same county on Jan. 1, 2023, enter on line 2A the county tax rate. Leave line 2B blank. If you are filing a joint return and you lived in different counties on Jan. 1, 2023: • Enter on line 2A your county tax rate from the county tax rate chart. • Enter on line 2B your spouse’s county tax rate from the county tax rate chart. Line 4 Add the amounts from line 3, Columns A and B and enter the result here. If you were a Perry County resident on Jan. 1, 2023, and worked in the Kentucky counties of Breckinridge, Hancock and/or Meade, review Lines 5 and 6 instructions. Otherwise, skip to line 7. Lines 5 and 6 If you: • Were a Jan. 1, 2023, Perry County resident, • Worked in the Kentucky counties of Breckinridge, Hancock and/ or Meade; and • The income from those counties was subject to either a Kentucky county income tax or a local income tax for a locality in those counties, review the following instructions. Otherwise, skip these lines and go to line 7. Line 5 – If the Kentucky counties of Breckinridge, Hancock and/or Meade, or a locality located within these counties figured a locality tax on your income, enter the amount of that income here. Line 6 – Multiply the amount on line 5 by .0140 and enter the result here. Continue to line 7. Line 7 Subtract any entry on line 6 from the amount on line 4. Enter the result here and on line 9 of Form IT-40.

IT-40 Booklet 2023 Page 51 NOTES:

IT-40 Booklet 2023 Page 52 NOTES:

IT-40 Booklet 2023 Page 53

IT-40 Booklet 2023 Page 54 Index to Instructions 2023 Changes........................................................................................... 3 A Add-Backs Bonus Depreciation Add-Back........................................................ 13 Conformity Add-Back Conformity Add-Back – Negative Entry..................................... 14 Conformity Add-Back – Positive Entry....................................... 13 Discontinued Add-Backs: How and When to Report a Final Catch- Up Modification........................................................................ 15 Employer Student Loan Payment Add-Back.................................. 14 Excess Federal Interest Deduction Modification........................... 14 Federal Repatriated Dividend Deduction Add-Back................................................................................... 14 Meal Deduction Add-Back............................................................... 15 Net Operating Loss Add-Back......................................................... 13 OOS Municipal Obligation Interest Add-Back.............................. 13 Qualified Preferred Stock.................................................................. 15 Section 179 Expense Add-Back....................................................... 13 Student Loan Discharge Add-Back................................................. 15 Treatment of Previously Discontinued Add-Back......................... 12 Adoption Credit.................................................................................... 32 Adoption Credit Carryforward Worksheets............................... 33–34 Amended (Corrected) Tax Return....................................................... 5 Amount Due.......................................................................................... 11 Annual Public Hearing........................................................................... 5 C Combined Limitation..................................................................... 37, 44 County Where You Lived Defined...................................................... 48 County Where You Worked Defined................................................. 49 Credits Economic Development for a Growing Economy Credit (EDGE). 32 Economic Development for a Growing Economy Retention Credit (EDGE-R).................................................................................. 32 Estimated Tax Paid............................................................................ 30 Headquarters Relocation Credit...................................................... 32 Indiana’s Earned Income Credit (EIC)............................................ 31 Indiana State and County Tax Withheld......................................... 29 Lake County (Indiana) Residential Income Tax Credit................ 31 Unified Tax Credit for the Elderly................................................... 30 D Deceased Taxpayer Date of Death...................................................................................... 45 Refund Check for a Deceased Individual......................................... 7 Signing the Deceased Individual’s Tax Return................................. 7 Deductions Civil Service Annuity Deduction..................................................... 19 COVID-related Employee Retention Credit Disallowed Expenses Deduction.................................................................................. 20 Disability Retirement Deduction..................................................... 20 Enterprise Zone Employee Deduction............................................ 20 Government or Civic Group Capital Contribution Deduction... 20 Human Services Deduction.............................................................. 20 Indiana Lottery Winnings Annuity Deduction............................. 21 Indiana Net Operating Loss Deduction.......................................... 18 Indiana-only Tax-exempt Bonds Deduction.................................. 21 Indiana Partnership Long-Term Care Policy Premiums Deduction. 21 Infrastructure Fund Gift Deduction................................................ 21 Interest on U.S. Government Obligations Deduction................... 17 Nontaxable Portion of Unemployment Compensation................ 19 Olympic/Paralympic Medal Winners Deduction.......................... 22 Private School/Homeschool Deduction......................................... 18 Qualified Patents Income Exemption Deduction.......................... 22 Railroad Unemployment and Sickness Benefits Deduction........ 22 Recovery of Deductions.................................................................... 23 Repayment of Previously Taxed Income Deduction..................... 23 State Tax Refund Reported on Federal Return.............................. 17 Taxable Social Security and/or Railroad Retirement Benefits Deduc­ tion.............................................................................................. 17 Dependents, Definitions and Special Rules for........................... 27–28 District Office, Visit................................................................................ 4 E Employer Student Loan Payment Interest Deduction..................... 20 Exemptions Additional Exemption for Age 65 or Older.................................... 25 Age 65 or Older or Blind................................................................... 25 Dependent Exemptions, Additional................................................ 26 Extension Extension Filing Deadline.................................................................. 8 Extension of Time to File.................................................................... 7 Extension of Time to File Information........................................... 45 Form IT-9.............................................................................................. 8 Penalty and/or Interest........................................................................ 8 Where to Report Your Extension Payment...................................... 8 F Farmers and Fishermen....................................................................... 45 File Your Return Electronic Filing Program.................................................................. 4 INfreefile............................................................................................... 4 Foreign Country Code........................................................................... 5 H Help With Your Return Information Line.................................................................................. 4 Internet Address................................................................................... 4 Local Help............................................................................................. 4 Homeowner’s Residential Property Tax Deduction......................... 16 I Important Information About Possible Year-End Federal Legislation. 12 Indiana Education Scholarship Account Deduction........................ 21 Indiana Enrichment Scholarship Account Deduction..................... 21 Indiana Nongame Wildlife Fund........................................................ 35 Individual Taxpayer Identification Number (ITIN)........................... 5 Information Bulletins, Obtaining......................................................... 4 Interest.................................................................................................... 11

IT-40 Booklet 2023 Page 55 L Losses 6 M Married Filing Requirements Married Filing Jointly.......................................................................... 5 Married Filing Separately................................................................... 5 Married Persons Who Live Apart Filing Status............................... 5 Military Family Relief Fund................................................................ 35 Military Personnel Military Address.................................................................................. 5 Military Personnel, County.............................................................. 49 Military Retirement Income and/or Survivor’s Benefits Deduction.. 17, 22 Military Service Deduction.............................................................. 17 National Guard and Reserve Component Members Deduction. 17, 22 Residency.............................................................................................. 7 Move During the Year.......................................................................... 49 Moving?.................................................................................................... 4 N Negative Entries...................................................................................... 6 Non- or Partially- Responsible Spouse.............................................. 45 O Offset Credits College Credit..................................................................................... 37 Community Revitalization Enhancement District Credit........... 36 Credit for Local Taxes Paid Outside of Indiana............................. 36 Credit for Taxes Paid to Other States.............................................. 37 Other Credits................................................................................ 39–44 Other Local Credits........................................................................... 36 Opt-Out Designation........................................................................... 45 Order of Application............................................................................ 37 Out-Of-State Income Information..................................................... 44 P Paid Preparer Information................................................................... 45 Payment Options.................................................................................. 11 Penalty.................................................................................................... 11 Personal Representative Information................................................. 45 Public K – 12 Education Fund............................................................ 35 R Refund Direct Deposit.................................................................................... 11 Refund Offsets.................................................................................... 10 Statute of Limitations for Refund Claims....................................... 11 When to Expect Your Refund.......................................................... 10 Where’s Your Refund?....................................................................... 10 Renter’s Deduction................................................................................ 16 Restriction for Certain Tax Credits.............................................. 36, 44 Retired Persons, Homemakers or Unemployed................................ 49 Returned Checks and Payments......................................................... 12 Rounding Required................................................................................ 6 S Sales/Use Tax Worksheet..................................................................... 29 Schedule 1: Add-Backs................................................................... 12–16 Schedule 2: Deductions.................................................................. 16–23 Schedule 3: Exemptions................................................................. 24–25 Schedule 4: Other Taxes....................................................................... 28 Schedule 5: Credits......................................................................... 29–32 Schedule 6: Offset Credits.............................................................. 36–44 Schedule 7: Additional Required Information............................ 44–46 Schedule IN-DEP............................................................................ 25–26 Schedule IN-DEP-A............................................................................. 26 Schedule IN-DONATE........................................................................ 35 Schedule IN-W: Indiana Withholding Statements........................... 35 Schedule IT-40NOL........................................................................ 46–48 Carryforward Worksheet.................................................................. 48 Computation of.................................................................................. 46 Record of Indiana NOL Application............................................... 47 When to use........................................................................................ 46 Schedules, Enclosing.............................................................................. 6 Social Security Number................................................................... 5, 28 T Tax Forms, Obtaining............................................................................. 4 Taxpayer Advocate................................................................................ 12 U Unemployment Compensation Worksheet....................................... 19 W W-2s, Enclosing....................................................................................... 6 Wagering Taxes..................................................................................... 13 Website..................................................................................................... 4 What if You Can’t File on Time?........................................................... 7 When Should You File?.......................................................................... 7 Where to Mail Your Tax Return.......................................................... 12 Which Indiana Tax Form Should You File?........................................ 3 Who Should File?.................................................................................... 6 Z ZIP/Postal Code...................................................................................... 5

Indiana Department of Revenue 100 North Senate Avenue Indianapolis, IN 46204-2253 This IT-40 booklet contains: • Form IT-40 and Instructions • Schedule 1: Add-Backs • Schedule 2: Deductions • Schedule 3: Exemptions • Schedule 4: Other Taxes • Schedule IN-DEP: Dependent Information and Additional Dependent Child Information • Schedule IN-DEP-A: Adopted Dependent Information • Schedule 5: Credits/Schedule IN-DONATE • Schedule 6: Offset Credits • Schedule 7: Additional Required Information • Schedule IN-W: Indiana Withholding Statements • Schedule CT-40: County Tax with tax rates • Schedule IN-EIC: Earned Income Credit • Schedule IT-40NOL: Individual Income Tax Net Operating Loss Computation • Form ES-40: Estimated Tax Payment Form