Allocation and apportionment of income of multistate corporations

Authority: IC 6-8.1-3-3

Affected: IC 6-3-1-3.5 ; IC 6-3-2-2

Sec. 37. Division of Income in General. Corporations doing business both within and without Indiana shall determine their income from Indiana sources through the use of the allocation and apportionment provisions contained in IC 6-3-2-2 (b)-(n), which generally follow the Uniform Division of Income For Tax Purposes Act. The multistate corporation must first determine what part of its adjusted gross income constitutes business income [See Regulation 6-3-1-20(010) [ 45 IAC 3.1-1-29 ] ] and what part is nonbusiness income. Business income is apportioned to this state based on the 3-factor (or other approved) formula. Nonbusiness income is allocated to specific jurisdictions pursuant to paragraphs (g)-(k) of IC 6-3-2-2 . Business income apportioned to this state plus nonbusiness income allocated to Indiana plus the modifications required by IC 6-3-1-3.5 (b) gives the total of the taxpayer's net income which is subject to adjusted gross income tax. As used above, the word "apportionment" refers to the division of income between states by use of the 3-factor (or other approved) formula; "allocation" means the assignment of income to a particular jurisdiction.

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Allocation and apportionment of income of multistate corporations

Official source

Authority: IC 6-8.1-3-3

Affected: IC 6-3-1-3.5 ; IC 6-3-2-2

Sec. 37. Division of Income in General. Corporations doing business both within and without Indiana shall determine their income from Indiana sources through the use of the allocation and apportionment provisions contained in IC 6-3-2-2 (b)-(n), which generally follow the Uniform Division of Income For Tax Purposes Act. The multistate corporation must first determine what part of its adjusted gross income constitutes business income [See Regulation 6-3-1-20(010) [ 45 IAC 3.1-1-29 ] ] and what part is nonbusiness income. Business income is apportioned to this state based on the 3-factor (or other approved) formula. Nonbusiness income is allocated to specific jurisdictions pursuant to paragraphs (g)-(k) of IC 6-3-2-2 . Business income apportioned to this state plus nonbusiness income allocated to Indiana plus the modifications required by IC 6-3-1-3.5 (b) gives the total of the taxpayer's net income which is subject to adjusted gross income tax. As used above, the word "apportionment" refers to the division of income between states by use of the 3-factor (or other approved) formula; "allocation" means the assignment of income to a particular jurisdiction.