As a companion to last issue’s "Intro to the Corporate Adjusted Gross Income Tax," this article will discuss the basics of Indiana’s individual income tax. Most of the information included in this article was gathered from the Indiana Department of Revenue’s website, which includes online forms, online filing, and a Frequently Asked Questions page - www.in.gov/dor.
Who Must File? In Indiana, an individual, partner, stockholder in a subchapter S corporation, trusts, and estates must file an Indiana income tax return if: (1) they live in Indiana and received income; or (2) they live outside Indiana but had income from Indiana. For those who live in Indiana all year and earn an income that exceeds their total exemptions, it is clear they must file an Indiana tax return.
It becomes a bit more complicated for part-year residents, such as retirees who spend their winter months in Florida. Such individuals may still be Indiana residents for tax purposes if:
• They maintain their home in Indiana and intend to return during part of the year;
• They still have an Indiana driver’s license;
• They kept their Indiana voting registration
• They claim a homestead deduction on their Indiana home for property tax purposes.
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