PDF document

- 1 -

State Form 49178                            Indiana Department of Revenue                                                       Enclosure Sequence No. 24
(R15 / 8-23)
                                                   Schedule EZ 1, 2, 3
                                                                                                 Tax  Year  Ending:  Month_________ Year _______
                              To Determine Enterprise Zone Adjusted Gross Income 
                                            for Employment Expense Tax Credit
Part 1 A
Name                                                                                             Federal Employer Identification Number

This schedule must be completed by taxpayers having income from                                  (Round all entries. Enter percent to two decimals, e.g., 67.89%.)
sources both within and outside the zone, who are not otherwise                                  Column  A                      Column  B                        Column C 
exempt from the allocation and apportionment provisions for                                      Total Within                 Total Within and                   Percent 
determining enterprise zone adjusted gross income.                                               the Zone                     Outside the Zone                   Within the Zone
1.  Receipts Factor (less returns and allowances):
    (a)  Sales delivered or shipped to the enterprise zone
            (1)  Shipped from within the zone.........................................                     00
            (2)  Shipped from outside the zone .....................................                       00
    (b)  Sales shipped from the zone to:
            (1) The United States government ......................................                        00
            (2)  A location outside a zone where the only sales activity  
                consists of the solicitation of orders which may be  
                accepted but are not subject to approval or rejection  
                at such location (for years beginning prior to  
                Jan. 1, 2016) ..................................................................           00
    (c)  Interest income and other receipts from extending credit  
            attributed to the zone  ...........................................................            00
    (d)  Other gross business receipts not previously apportioned ...                                      00
2.  Total Receipts: Add column A, lines 1(a) through 1(d); enter all  
    receipts in column B .....................................................................             00                             00
3.  Adjusted Receipts Percent Within Zone:  Divide total receipts, column A by amount in column B; enter                                   
    percent within zone here ...................................................................................................................................          %

                              To Determine Allocated Non-business/Non-unitary 
                      Enterprise Zone Income for Employment Expense Tax Credit
Part 1 B
Allocate, using the provisions of  IC 6-3-2-2(g), any income classified as non-business                                       Zone Sources                       Zone Sources 
derived from sources within the zone and from sources everywhere.                                                               Column A                         Column B

(1)  Dividends (not from DISC or FSC) (excess after dividend deduction) ..........................                            1           00 1                            00
(2)  Interest (other than U.S. government interest) ..............................................................            2           00 2                            00
(3)  Net capital gains or losses ............................................................................................ 3           00 3                            00
(4)  Rents and royalties from tangible personal property .....................................................                4           00 4                            00
(5)  Patents, copyrights, and royalties from intangible property...........................................                   5           00 5                            00
(6)  Other non-business income ..........................................................................................     6           00 6                            00
(7)  Distributive share income from non-unitary partnerships and tiered partnerships ........                                 7           00 7                            00
(8)  Less other related expenses for non-business income .................................................                    8           00 8                            00
(9)  Net non-business and non-unitary partnership/tiered income or loss (add lines 1  
    through 7; subtract line 8 for each column) ...................................................................           9           00 9                            00

                                        *24100000000*
                                                                24100000000

- 2 -

Enlarge image

Part 2 Enterprise Zone Employment Expense Tax Credit Calculation
Name Federal Employer Identification Number

Indicate type of income tax return to be filed by employer (Check one): *Pass-through entities □ S Corp. Form IT-20S*
□ Individual Form IT-40/IT-40PNR □ Nonprofit Form IT-20NP □ Partnership Form IT-65*
□ Corporation Form IT-20 □ Financial Institution Form FIT-20 □ Fiduciary Form IT-41*

Location Name of Enterprise Zone(s) or Airport Development Zone Base Base Period Current Tax Year
Period Year Qualified Wages Qualified Wages

1. Qualifying wages attributed to zone (pass-through entities enter zero
on line 1a) .............................................................................................. 1a 00 1b 00
2. Qualified increase (subtract line 1a from line 1b) ............................................................................................ 2 00
3. Multiply line 2 by 10% (0.10) ............................................................................................................................ 3 00
4. Number of qualified employees (except for pass-through entities, number first employed after
12-31-1998): _____ X $1500 ........................................................................................................................... 4 00
5. Enter the lesser of line 3 or line 4 (this is your current year employment expense credit) .................................. 5 00
6. Current year federal adjusted gross income after Indiana modifications
(see instructions) .......................................................................................................... 6 00
Entities subject to insurance premium tax or financial institutions tax skip to line 15.
7. Non-business income from all sources from Part 1B, line 9 of column B ..................... 7 00
8. Net taxable business income (subtract line 7 from line 6) ............................................ 8 00 Line 9:
9. Apportionment percentage from Part 1A, line 3 for taxable year ................................ 9 00 Apportionment
formula in effect for
10. Enterprise zone business income (multiply line 8 by line 9) ......................................... 10 00 your taxable year.
11. Non-business enterprise zone income from Part 1B, line 9 of column A ...................... 11 00
12. Enterprise zone net operating loss deduction (see instructions) .................................. 12 00
13. Total “enterprise zone adjusted gross income” (add line 10 and line 11;
subtract line 12) ............................................................................................................ 13 00
14. Enterprise zone adjusted gross income tax (multiply line 13 by tax rate).
See instructions for current individual and corporate tax rates ........................................................................ 14 00
15. This is your qualified state tax liability: Enter the amount from line 14, the net
financial institution tax, or insurance premium tax attributed to the enterprise zone.
A pass-through entity with no tax liability will enter zero. ................................................................................. 15 00
16. Enter the lesser of line 5 (plus applied carryover credit) or line 15. If line 15
exceeds line 5, add your available unused carryover credit from other tax years,
up to the remaining amount of your qualified state tax liability ........................................................................ 16 00
(Carry this amount to the appropriate credit entry line on the annual corporate or individual income tax return. Pass-
through entities with no income tax liabilities enter the pro rata share of credit from line 5 above, on Form IN K-1.)
17. Unused credit carryover: If line 5 exceeds line 15, enter the excess here and on Part 3 ................................ 17 00

I certify I have examined this schedule and, to the best of my knowledge and belief, it is true, correct, and complete. I further certify that
Indiana business activities were not substantially reduced for the purpose of relocating the business in an enterprise zone.

___________________________________________ ____________________________ __________________________
Signature Title Date

*24100000000*
24100000000

- 3 -

Enlarge image

Part 3 Employment Expense Tax Credit Carryover for Enterprise Zone Tax Liability

Year of Credit       Credit Carryback        Period Ending        Qualified Tax Liability Remaining Excess 
                                                                                Applied   Credit
____________________ 3rd preceding tax year  ____________________ $___________________    $___________________
                     2nd preceding tax year  ____________________ $___________________    $___________________
                     1st preceding tax year  ____________________ $___________________    $___________________
Amount of Excess 
Credit from Part 2   Credit Carryforward
                     1st following tax year  ____________________ $___________________    $___________________
____________________ 2nd following tax year  ____________________ $___________________    $___________________
                     3rd following tax year  ____________________ $___________________    $___________________
                     4th following tax year  ____________________ $___________________    $___________________
                     5th following tax year  ____________________ $___________________    $___________________
Location Name of     6th following tax year  ____________________ $___________________    $___________________
Enterprise Zone(s)   7th following tax year  ____________________ $___________________    $___________________
                     8th following tax year  ____________________ $___________________    $___________________
____________________ 9th following tax year  ____________________ $___________________    $___________________
                     10th following tax year ____________________ $___________________    $___________________

                     *24100000000*
                                             24100000000

- 4 -

Enlarge image

Instructions for Completing Schedule EZ 1, 2, 3

General Information Total receipts include gross sales of real and tangible personal
Taxpayers doing business within an enterprise zone and property less returns and allowances. Sales of tangible personal
remaining in good standing with the Indiana Economic property are in a zone if the property is delivered or shipped to a
Development Corporation (IEDC) may qualify for an adjusted purchaser within the zone regardless of the free on board (f.o.b.)
gross income or financial institution tax credit. Use EZ schedules point or other conditions of sale or if the property is shipped from
to determine the amount of income tax liability credit for an office, a store, a warehouse, a factory, or any other place of
qualified employment expense. storage in a zone and the taxpayer is not taxable in the state of the
purchaser.
Part 1 A & B - Taxpayers with any business activity or income
derived from sources both within and outside an enterprise zone Sales or receipts not specifically assigned above will be assigned as
may be required to allocate and apportion their income. Use follows:
designated Part 1A of Schedule EZ to determine the apportionment (1) Gross receipts from the sale, rental, or leases of real
percentage for enterprise zone income. Note: A taxpayer is exempt property are in a zone if the real property is in the zone;
from the allocation and apportionment provision if it: (2) Gross receipts from the rental, lease, or licensing the use
(1) Does not own, rent, or lease real property outside of an of tangible personal property are in a zone if the property
enterprise zone that is an integral part of its trade or is in the zone. If the property was both within and
business; and outside the zone during the tax year, the gross receipts
(2) Is not owned or controlled directly or indirectly by a are considered in the zone to the extent the property was
taxpayer that owns, rents, or leases real property outside used in the zone;
of an enterprise zone. (3) Gross receipts from intangible personal property are in
In such cases the taxpayer will attribute all income to the zone. a zone if the taxpayer’s commercial domicile is in the
zone and such property has not acquired a business situs
Part 2 - Use Part 2 of Schedule EZ to determine the tax credit for elsewhere; and
qualified increased enterprise zone employment expenditures. If (4) Gross receipts from the performance of services are in
the calculated employment expense credit exceeds the qualified a zone if the services are performed in the zone. If such
state tax liability, you also must complete Part 3. services are performed partly within and partly outside
the zone, part of the gross receipts from the performance
Part 3 - Use Part 3 of Schedule EZ to claim a carryover of of the services will be attributed to the zone based upon
employment expense credit and to record the remaining amount the ratio of direct costs incurred in the zone to the total
of unused credit. direct costs of the services, unless the taxpayer can
directly attribute the service to the zone.
The certification at the bottom of Part 1B must be signed by any
taxpayer using either Part 1 or Part 2 of the schedule. Taxpayers Sales to the United States Government: The United States
doing business in more than 1 enterprise zone should complete government is the purchaser when it makes direct payment to the
a separate schedule for each zone if there are different base seller. A sale to the U.S. government of tangible personal property
years. Refer to the detailed instructions for each part. For more is in a zone if it is shipped from an office, a store, a warehouse,
information, see Income Tax Information Bulletin #66 at www. or an other place of storage in the zone. Refer to the previous
in.gov/dor/files/reference/ib66.pdf. guidelines for sales other than tangible personal property if such
sales are made to the U.S. government.
Part 1A - Apportioned Enterprise Zone Adjusted Gross Income
for Employment Expense Tax Credit Total Receipts: Add receipts factor lines (a) through (d). Also
If the income of a taxpayer is derived from sources both within and enter receipts from everywhere in column B.
outside an enterprise zone, the adjusted gross income attributed
to the zone must be determined by use of an apportionment Adjusted Receipts Percent Within Zone: Divide the receipt total
formula unless written permission from the Indiana Department of in column A by the total from column B.
Revenue is granted or the statute exempts the taxpayer.
Enter the result in line 1 of column C.
Line 1 (a) (b) (c) (d) - Receipts Factor: The gross receipts factor
is a fraction. The numerator is the total receipts of the taxpayer Part 1 B - Allocated Non-business/Non-unitary Enterprise
during the tax year, and the denominator is the total receipts of Zone Income for Employment Expense Tax Credit
the taxpayer everywhere during the tax year. The numerator of the Complete this part if you are apportioning gross receipts and are
receipts factor must include all sales made in the zone, sales made excluding any income that is considered non-business income.
from the zone to the United States government. Pursuant to IC
6-3-2-2(e)(2), for periods beginning prior to Jan. 1, 2016, include Lines (1) and (2): Interest (long-term) and dividends from
sales made from the zone to a state that does not have jurisdiction non-business sources are allocable to an enterprise zone if the
to tax the activities of the seller. taxpayer’s commercial domicile is in the zone. Dividends from
foreign sales corporations (Foreign Sales Corporation (FSC) or
For purposes of the employment expense credit, the numerator Domestic International Sales Corporation (DISC)) are treated as
will also contain intangible income attributed to Indiana, business income and must be apportioned.
including interest from consumer and commercial loans,
installment sales contracts, and credit/debit cards as prescribed
under Indiana Code (IC) 6-3-2-2.2.

- 5 -

Enlarge image

Line (3): Net capital gains or losses (sales price less acquisition     (1)  Has a principal place of residence in the enterprise zone 
cost) from the sale of non-business personal property are allocated             in which he or she is employed;
to an enterprise zone if the property had its primary business          (2)  Performs services of which 90% are directly related to 
location in the zone at the time of the sale or the taxpayer’s                  the conduct of the taxpayer’s trade or business located in 
commercial domicile is in the zone. Include net capital gain or                 an enterprise zone;
loss from the sale or exchange of all real property located in an       (3)  Performs at least 50% of his or her service for the 
enterprise zone not used in the production of business income.                  taxpayer in the zone; and
                                                                        (4)  In the case of an individual who is employed by a  
Line (4): Rents and royalties from tangible personal property are               taxpayer that is a pass-through entity, was first employed 
allocated to an enterprise zone if the property is located in the               by the taxpayer after Dec. 31, 1998. 
zone and is non-business related. 
                                                                        Except for employers who are defined as pass-through entities,  
Gross rents and royalties from non-business-related tangible            an increase in wages is determined by subtracting wages paid to 
personal properties are allocated to an enterprise zone to the          employees that could qualify in the base year from wages paid to 
extent the property is located or utilized in the zone:                 qualified employees in the current tax year. The base year is the 
(a)  The extent of utilization is determined by multiplying             12-month period immediately preceding the month in which 
         the rents and royalties by a fraction. The numerator is        an enterprise zone is established. Divide the annual base period 
         the number of days of physical location of the property        qualified EZ employee wages by 12 to find the monthly base 
         in the zone during the rental or royalty periods in the tax    period wages. 
         year. 
         The denominator is the number of days of physical              Taxpayers whose tax years do not coincide with the designation 
         location of the property everywhere during the rental or       of an enterprise zone must prorate their qualified wages for the 
         royalty periods in the tax year.                               period after designation. For the year in which an enterprise zone 
(b)  Such rents and royalties are wholly allocated to an                is designated, fiscal year taxpayers should prorate their qualified 
         enterprise zone if the taxpayer’s commercial domicile is       wages. 
         in the zone. 
                                                                        Enterprise Zone            Base Year
Line (5): Patents and copyrights and royalties from intangible 
property not related to the production of business income are           Bedford                    12 months preceding Feb. 1, 1993
allocated to an enterprise zone to the extent they are utilized by      Bloomington                12 months preceding Feb. 1, 1992
the taxpayer in the zone or the taxpayer’s commercial domicile is       Connersville               1994
in the enterprise zone. 
                                                                        East Chicago               1988
A patent is utilized in a zone to the extent the taxpayer employs       Elkhart                    1998
it in production or other processing in the zone or produces a          Evansville                 2003
patented product in the zone. 
                                                                        Ft. Harrison Reuse Authority 12 months preceding Dec.1, 1997
A copyright is utilized in a zone to the extent printing or other       Ft. Wayne                  2003
publications originated in the zone.                                    Frankfort                  2002
Line (6): Enter other non-business income not provided for              Hammond                    1984
in lines 1 through 5. Explain other non-business income on a            Jeffersonville             1999
separate schedule and attach it to the return.                          Lafayette                  12 months preceding Feb. 1, 1993
Line (7): Enter in column A apportioned Indiana income, as              La Porte                   2001
modified, from Form IT-65 Schedule IN K-1, and any portion of           Michigan City              2003
tiered partnership income attributed to the zone. Enter in column       Mitchell                   2000
B the total non-unitary partnership and tiered partnership 
income reported on the federal return.                                  New Albany                 1999
                                                                        Portage                    2000
Line (8): Enter all related non-business expenses other than state      Richmond                   2004
income taxes. 
                                                                        River Ridge Development 
Line (9): For net non-business and non-unitary partnership              Authority                  12 months preceding Feb. 1, 1998
income or loss, add lines 1 through 7; subtract line 8 for each         Salem                      2002
column.                                                                 South Bend                 2004
Part 2 - Enterprise Zone Employment Expense Tax Credit                  Vincennes                  2001
Calculation 
IC 6-3-3-10 provides a credit against qualified state tax liability to  Qualified state tax liability means each taxpayer’s total income or 
certain enterprise zone employers. The credit is the lesser of 10%      financial institution tax liability incurred under: 
of the increase in wages paid to qualified employees or $1,500          (1)  IC 6-3-1 through 6-3-7 (state adjusted gross income tax) 
multiplied by the number of qualified employees. A qualified                    with respect to enterprise zone adjusted gross income; 
employee is an individual who:                                          (2)  IC 27-1-18-2 (insurance premiums tax) with respect to 
                                                                                enterprise zone insurance premiums; and 
                                                                       2

- 6 -

Enlarge image

(3) IC 6-5.5 (financial institutions tax) as computed after the Separately complete the apportionment Schedule EZ, Part 1
application of the credits that, under IC 6-3.1-1-2, are to applicable to the loss year. Multiply the remaining net operating
be applied before this credit. loss deduction used in the current year by this percentage, and
enter the product on line 12 as a positive figure.
Pass-through entity means a:
(1) Corporation that is exempt from adjusted gross income Line 14: Multiply line 13 by the appropriate tax rate. The
tax under IC 6-3-2-2.8(2) (S corporation); individual income tax rate is as follows:
(2) Trust; After December 31, 2016 and before January 1, 2023 3.23%
(3) Limited liability company; or After December 31, 2022 3.15%
(4) Partnership.
A corporation or an entity doing business in Indiana is subject to
If a pass-through entity is entitled to a credit but does not have a the corporate adjusted gross income tax (AGIT). The corporate
state tax liability against which the tax credit may be applied, an AGIT tax rate is as follows:
individual who is a shareholder, partner, beneficiary, or member After June 30, 2015, and before July 1, 2016 6.5%
of the pass-through entity is entitled to a pro rata share of the After June 30, 2016, and before July 1, 2017 6.25%
computed tax credit. After June 30, 2017, and before July 1, 2018 6.0%
After June 30, 2018, and before July 1, 2019 5.75%
If the credit exceeds the taxpayer’s qualified state tax liability for the After June 30, 2019, and before July 1, 2020 5.5%
taxable year, the taxpayer can carry any excess credit back 3 years After June 30, 2020, and before July 1, 2021 5.25%
and forward up to 10 years until the enterprise zone terminates. After June 30, 2021, 4.9%

Caution: An eligible enterprise zone employer for purposes of the For taxpayers who are not calendar-year filers, the tax rate is
employment expense credit cannot be a governmental agency or prorated based on the number of months in the taxpayer’s taxable
nonprofit organization (with no unrelated tax liability). year for which the rate is effective. The prorated rate will be
rounded to the nearest .01%.
For additional information, get Income Tax Information Bulletin
#66 at www.in.gov/dor/files/reference/ib66.pdf. Line 15: The entry on this line represents total qualified state tax
liability. Taxpayers filing Form IT-20 must enter the amount from
Contact the Indiana Economic Development Corporation, 1 N. line 14. Financial institution taxpayers must enter net financial
Capitol Ave., Suite 700, Indianapolis, IN, 46204, or visit their institution tax due (line 29 of Form FIT-20) reduced by other
website at iedc.in.gov for more information. nonrefundable state tax credits. Domestic insurance companies
should enter the portion of premium tax attributed to the
Line 1: Enter base period year. For a pass-through entity, enter enterprise zone.
1999. Enter on line 1a the amount of base period wages paid;
except for pass-through entities, base period wages will be 0. Line 16: This is the credit available for the current year plus any
Enter on line 1b the amount of wages paid to qualified employees applied credit carryover. A pass-through entity without any
during the current year. However, pass-through entities must current year income tax liability may pass through to each of its
enter the amount of wages paid to only qualified employees, members their pro rata share of credit from line 5 plus any unused
newly hired since 1999, during the current tax year. Wages paid to carryover.
otherwise qualified employees who were already employed by the
pass-through entity before Jan. 1, 1999, may not be included. Line 17: When the total credit (on line 5) exceeds the current year
qualified state tax liability (on line 15), the taxpayer may carry
Line 3: Enter a figure based on the number of qualified employees the excess back and/or forward against computed state income
during the tax year. Caution: Employers who are pass-through tax liabilities derived from the enterprise zone. Refer to the
entities may count only those qualified employees who were first instructions for Part 3.
employed by the entity after Dec. 31, 1998.
Note: A taxpayer is not entitled to a refund of any unused credit.
Line 6: Taxable income, for purposes of the credit, is federal
taxable income (before net operating loss deduction) with all Part 3 - Employment Expense Tax Credit Carryover for
applicable Indiana modifications. However, an S corporation Enterprise Zone Tax Liability
with passive income or built-in gains tax liability must enter the When the enterprise zone employment expense credit exceeds
amount computed on Schedule B of Form IT-20S. Employers the taxpayer’s qualified state tax liability for the tax year, the
not subject to the apportionment and/or allocation method of remaining credit may be carried back 3 years and applied to each
computing zone income should disregard lines 7 through 12 year whether or not a credit is utilized, and/or carried forward up
and enter Indiana net taxable adjusted gross income from zone to 10 years or until the enterprise zone terminates.
sources on lines 6 and 13. Domestic insurance companies paying
insurance premium tax, financial institutions, and pass-through The application of the credit, when carried over, must be shown
entities with no tax liabilities must enter 0 and go on to line 15. on Schedule EZ, Part 3. A copy of this schedule should be
attached to any return on which the taxpayer is applying the
Line 12: Taxpayers whose Indiana adjusted gross income is credit. A separate schedule should be completed when a credit is
totally eliminated by a net operating loss deduction will have available from more than 1 tax year.
no enterprise zone adjusted gross income tax and should enter
0 on line 14. Taxpayers whose Indiana adjusted gross income is Note: The amount of credit applied is generally limited to the
partially offset by a net operating loss deduction must determine qualified state tax liability, which is based on the tax on income
the portion of the loss attributable to an enterprise zone source. derived from the enterprise zone.
3

PDF file checksum: 1573311533

(Plugin #1/10.13/13.0)