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IN Resident

Tax Year 2013

 

This worksheet is used to file the taxpayer's state tax return as a full-year resident of Indiana.

 

Who Must File
A resident of Indiana must file an Indiana tax return if his or her Indiana gross income exceeds the total amount of his or her exemption for the return. The amount of exemption is calculated by multiplying each federal exemption by $1,000 and adding to that amount an additional $1,500 for each dependent child.

 

Example: The taxpayer is filing jointly with his wife, with two dependent children, and a mother-in-law whom they also claim. Their total exemption is $8,000-$1,000 each for the taxpayer, wife, 2 children and mother-in-law, and an additional $1,500 each for the 2 children.

 

Dependent Child
A dependent child must meet all of the following requirements:

  1. Must be the taxpayer's son, stepson, daughter, stepdaughter, and/or foster child,
  2. Must also be the spouse's child if filing a joint return,
  3. Must be under the age of 19 by the last day of the tax year, or a full-time student under the age of 24 by the last day of the tax year.

 

Resident
An Indiana resident is a person who maintained their legal residence in Indiana through the entire tax year. A person does not have to be physically present in the State of Indiana the entire year to be considered a full year resident. Residents who are temporarily absent from Indiana, including military personnel, are considered residents during the absence. A resident who lives in another state for part of the year may still be an Indiana resident based on the following facts and circumstances:

  • If he or she maintains a legal residence in Indiana and intends to return during the tax year,
  • If he or she retains an Indiana driver's license,
  • If he or she retains Indiana voting rights,
  • If he or she claims a homestead deduction on their Indiana home for property tax purposes.

See the 2013 Indiana Full-Year Resident Individual Income Tax Booklet for more information and details.

Form IT-40
Taxpayer

County
Select from the dropdown list the county in which the taxpayer lived on the last day of the tax year.

 

School District
Select from the dropdown list the school district in which the taxpayer lived on the last day of the tax year.

 

County Where Taxpayer Worked
Select from the dropdown list the county in which the taxpayer worked on the last day of the tax year. If the taxpayer did not work, enter the same county in which the taxpayer lived.

Spouse

County
Select from the dropdown list the county in which the spouse lived on the last day of the tax year.

 

County Where Spouse Worked
Select from the dropdown list the county in which the spouse worked on the last day of the tax year. If the spouse did not work, enter the same county in which the spouse lived.

Form IT-40 Continued
Line 17 Nongame Wildlife Fund
Enter the amount the taxpayer would like donated from his or her refund to the Nongame Wildlife Fund.

Form IT-40 Schedule 2 Deductions

Line 1-Renter's Deduction

Address Where Rented
Enter the address of the rented property if the taxpayer meets the eligibility requirements below to take the renter's deduction.

 

Landlord's Name and Address
Enter the landlord's name and address who rents the property to the taxpayer.

 

Number of Months Rented
Select from the dropdown list the number of months this property was rented.

 

Amount of Rent Paid
Enter the amount of rent paid during the tax year, up to $3000.

 

Eligibility
The taxpayer is eligible for this deduction if he or she meets the following requirements:

  1. The taxpayer paid rent on his or her principal place of residence (defined below), and
  2. The property the taxpayer rented was subject to Indiana property tax and not exempt from property tax (defined below).

Principal Place of Residence
The taxpayer's "principal place of residence" is the place where the taxpayer had the taxpayer's true, fixed, permanent home and where the taxpayer intends to return after being absent. If the taxpayer rented a manufactured home or paid rent for the taxpayer's manufactured home lot, the taxpayer may claim the renter's deduction if the above requirements are met.

 

Caution: Rent paid for summer homes or vacation homes is not deductible.

 

Exempt from Property Tax
The taxpayer cannot claim the renter's deduction if the rental property was exempt from Indiana property tax. Examples of this type of property include the following:

  1. Government owned housing,
  2. Property owned by a nonprofit organization,
  3. Student housing,
  4. Property owned by a cooperative association, and
  5. Property located outside of Indiana.

Important Note: The taxpayer must maintain copies of the taxpayer's rental receipts, landlord identifying information, and lease agreements as the Department of Revenue may request this information.

 

See the Income Tax Information Bulletin 38 for more information and details about this deduction.

Line 2-Residential Homeowners Property Deduction

Address for Property on Which Tax was Paid
Enter the address of the property for which property taxes were paid if the taxpayer meets the eligibility requirements below to take the Residential Homeowner's Property deduction only if this address is different than the address filed for the return.

 

Number of Months Resided
Select from the dropdown list the number of months the taxpayer resided at this property.

 

Amount of Property Tax Paid
Enter the amount of property taxes paid during the tax year, minus any amount that is deduced as a business expense on the federal return, up to $2,500. If these amounts were entered on the Federal Schedule A, this line can be left blank, and the amount entered on that worksheet will be used for this calculation.

 

Eligibility
The taxpayer is eligible for this deduction if he or she meets the following requirements:

  1. The taxpayer paid property taxes on his or her principal place of residence (defined below) during the tax year, and
  2. The taxpayer cannot claim the Lake County residential income tax credit below.

Principal Place of Residence
The taxpayer's "principal place of residence" is the place where the taxpayer had the taxpayer's true, fixed, permanent home and where the taxpayer intends to return after being absent.

 

Caution: Property taxes paid for summer homes or vacation homes are not deductible.

Line 6 Taxable Railroad Retirement Benefits
Enter the amount of U.S. Railroad Retirement benefits that were taxable on the federal return.
Taxpayer and Spouse Line 8

Non Indiana Locality Deduction
Enter up to $2,000 for the taxpayer and/or spouse for income earned outside of Indiana that was taxed by an out of state local government unit.

 

See the Income Tax Information Bulletin 28 for more information and details about this deduction.

Line 9

Insulation Deduction
Enter the actual cost of materials and labor, up to $1000, if the taxpayer installed new insulation, weather stripping, double pane windows, storm doors or storm windows in the taxpayer's Indiana home during the tax year and met the eligibility requirements as described below.

 

Do not include any amounts for the cost of labor of the taxpayer.

 

Eligibility Requirements
The following requirements must be met to be eligible for this deduction:

  1. The insulating items must have been installed in the taxpayer's principal place of residence located in Indiana,
  2. The part of the taxpayer's home where the insulating items were installed must have been built before January 1, 2005,
  3. The insulating items must be an upgrade and not a replacement or like-kind item (Example: Replacing a double pane window with a new double pane window will not qualify, but replacing a double pane window with a triple pane window will qualify), and
  4. The deduction must be taken in the year the insulating items were installed.
Other Deductions - Line 11
Civil Service Annuity Deduction

Enter the amount of federal civil service annuity payments received by the taxpayer and/or spouse, up to $2,000, minus the amount of any social security or railroad retirement benefits received, if the taxpayer meets the eligibility requirements described below for this deduction.

 

Example: The taxpayer received $10,000 in annuity benefits and $1,800 in social security benefits. The taxpayer will subtract the $1,800 from $2,000 for a deduction of $200.

 

Eligibility Requirements
This deduction is available to the taxpayer and/or spouse if he or she was at least 62 years of age on the last day of the tax year and is the annuitant. This deduction is not available to the beneficiary of the annuitant.

National Guard and Reserve Component Members Deduction

Enter the amount of military income received as a result of involuntary orders during the period the taxpayer was deployed or mobilized for full time service or during the period the taxpayer's Indiana National Guard unit was federalized if the taxpayer meets the eligibility requirements described below.

 

Eligibility Requirements
The taxpayer or spouse must be a member of the reserve component of the Army, Navy, Air Force, Coast Guard, Marine Corps, or Merchant Marine, or a member of the Indiana Army National Guard or Indiana Air National Guard.

 

Important Note: Do not make any entry for Combat Pay because it is already excluded from federal and state income.

Solar Powered Roof Vent or Fan Deduction

Enter the taxpayer's deduction for a solar powered roof vent or fan that was installed by the taxpayer on a building owned or leased by the taxpayer whose purpose is to release heat from the building.

 

Calculation of the Deduction
The deduction is equal to the lesser of one half of the amount paid for labor and materials or $1000.

Enterprise Zone Employee Deduction

Enter the taxpayer's enterprise zone employee deduction which is equal to one-half of earned income, up to $7,500.

 

The taxpayer's employer will provide Form IT-40QEC if the taxpayer is eligible for this credit.

Indiana Partnership Long-Term Care Policy Premiums Deduction

Enter the amount of premiums paid during the tax year for an Indiana partnership long-term care insurance policy.

 

Indiana Partnership Long-Term Care Insurance Policy defined
A policy that meets this requirements will have a box on the front page of the policy that has the following verbiage: "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.

Private School/Home School Deduction

Number of Qualified Children
Enter the number of dependent children who qualify the parents for this deduction.

 

Name of School and IDOE number
Enter the name of the private school, if applicable, and the IDOE number issued by the state. If an IDOE number has not been issued to the school, just enter the name of the school.

 

Dependent Children defined
A dependent child that qualifies the taxpayer for this deduction must meet the following requirements:

  1. The child must be eligible to receive a free K-12 education in an Indiana school,
  2. Thie child must be attending a nonpubic school in Indiana that satisfies a child's obligation for compulsory attendance at a school,
  3. The taxpayer must be eligible to claim the child as a dependent on the federal tax return,
  4. The child must be taxpayer's natural or adopted child, or the parent must have been awarded custody or appointed as a guardian to the child, and
  5. The parent must have paid education expenditures on the child made in conjunction with enrollment, attendance, or participation in a K-12 education program, including tuition, fees, computer software, textbooks, workbooks, curricula, school supplies, and other written materials. This does not include personal computers.

Deduction Available
The deduction available in 2013 for each eligible child is $1000.

 

Important Note: The deduction can only be claimed by one parent for each child.

Form IT-40 Schedule 5
Earned Income Credit
This credit may be available to the taxpayer if the federal earned income credit was available. Answer the questions below, and the credit will be automatically calculated and added to the return.
Line 5A Select "Yes" if the taxpayer is reporting an income or loss from the rental of personal property not used in a trade or business.
Line 5B Enter any royalty income reported on the federal Schedule E, Line 4 plus any income from the rental of personal property shown on Form 1040, Line 21.
Line 5C Enter any expenses from Schedule E, Line 20, related to royalty income, plus any expenses from the rental of personal property deducted on Form 1040, Line 36.
Line 5D Enter the total of all net income or losses from qualified joint ventures that are passive activities with rental real estate income reported on the Schedule C, Line 31 and/or Schedule C-EZ, Line 3, but not included in net earnings from self-employment.
Line 5E Enter any income reported from the rental of personal property on federal Form 1040, Line 21, plus any royalty income included on federal Schedule E, Line 4.
Line 5F Enter any expenses from the rental of personal proprety deducted on federal Form 1040, Line 36, plus any expenses from federal Schedule E, Line 20 related to royalty income.
Line 6 - Lake County Residential Income Tax Credit
Line 6A

Property Tax Paid for Lake County Residence
Select from the dropdown list, either "Yes" or "No" as to whether the taxpayer paid property on his or her residence in Lake County during the tax year and meets the eligibility requirements for the Lake County Residential Income Tax Credit described below.

 

Eligibility Requirements
The taxpayer must meet the following requirements to be eligible for this credit:

  1. The taxpayer must have paid property taxes to Lake County during the tax year for his or her residence, which is the taxpayer's principal dwelling which he or she owns or is under contract to purchase.
  2. The taxpayer's earned income must be less than $18,600 which includes the taxpayer's (and the spouse's if filing a joint return) wages, salaries, tips, and other compensation, plus net earnings from self-employment income on which the taxpayer is required to pay self-employment tax on federal Schedule SE.
  3. The taxpayer cannot claim the homeowner's residential property tax deduction on Indiana Schedule 1 above.

Important: The taxpayer is not required to have earned income to be eligible for this credit.

Line 6B

Property Tax Paid
Enter the amount of property tax paid on the Lake County residence during the tax year.

Form IT-40 Schedule 6 Offset Credits
Line 1-Credit for Local Taxes Paid Outside of Indiana

Rate
Enter the rate from the 2013 Rate Conversion Chart which can be found on Page 40 of the 2013 Indiana Full-Year Resident Individual Income Tax Booklet as follows:

  • If the taxpayer lived in a county on the first day of the tax year that has a rate on the Rate Conversion Chart, enter the rate from Column A.
  • If the taxpayer lived in Lake County on the first day of the tax year and worked in a county that has a rate on the Rate Conversion Chart, enter the rate for the work county from Column B.

Amount of Income Taxed by Non-Indiana Locality
Enter the taxpayer's and/or spouse's income that was taxed by a locality located outside of Indiana.

 

Amount of Tax Paid to Non-Indiana Locality
Enter the amount of tax paid to the locality located outside of Indiana.

 

Do not make an entry for the following circumstances:

  • If the taxpayer received a full refund of the non-Indiana tax, or if the taxpayer received a credit from the locality for taxes paid to an Indiana county, or
  • An entry for any state taxes paid - This credit is available for local taxes paid only.
Other Credits - Line 6
Enterprise Zone Employee Expense Credit

Enter the taxpayer's enterprise zone employee expense credit, which is equal to 10% of qualifying wages, up to $1,500 per qualified employee, and up to the amount of tax liability on the income derived from the enterprise zone.

 

See Income Tax Information Bulletin 66 for more details.

Enterprise Zone Investment Cost Credit

Enter the taxpayer's enterprise zone investment cost credit, which can be up to 30% of the investment, depending on the number of employees, the type of business, and the amount of investment in the enterprise zone.

 

See Income Tax Information Bulletin 66 for more details.

Enterprise Zone Loan Interest Credit

Enter the taxpayer's enterprise zone loan interest credit, which can be up to 5% of the interest received from all qualified loans made during the tax year for use in an Indiana enterprise zone.

 

See Income Tax Information Bulletin 66 for more details.

Form IT-40 Schedule 7 Additional Required Information
The taxpayer and/or spouse must enter the information in this section if he or she received wages, tips, or other compensation from Kentucky, Michigan, Ohio, Pennsylvania, and/or Wisconsin.

 

Note: This is used for informational purposes only, and will not change the taxpayer's refund or the amount of tax owed. However, the information is still required for filing an accurate return.

State Taxpayer Worked Enter the two digit postal code of the state listed above in which the taxpayer worked, if applicable.
State Spouse Worked Enter the two digit postal code of the state listed above in which the spouse worked, if applicable.
Taxpayer and Spouse Income

Salary, Wage, Tip and/or Compensation Received from Another State
Enter the amount of all wages, tips, or other compensation received by the taxpayer and spouse, individually, from income sources located in one of the states listed above.

Checkbox Check the box if the taxpayer filed an Indiana extension for this tax year.
Form CT-40 County Tax Schedule for Residence
Section 1, Line 1B

Enter the spouse's Indiana taxable income only if the taxpayer and spouse are filing a joint return, and they did not live in the same county on the first day of the tax year.

 

Spouse's Indiana Taxable Income
This is calculated as follows:

  1. Federal adjusted gross income applicable to spouse
  2. Minus $1,000 for spouse's exemption
  3. Minus any dependent exemptions of the spouse at $1,500 each
  4. Minus $500 if the spouse was age 65 or older and had federal adjusted gross income less than $40,000.
Section 1, Line 7
Enter the taxpayer's and spouse's income together that was taxed by Perry, Breckenride, Hancock or Meade counties, if the taxpayer lived in Perry County and worked in Breckenride, Hancock, or Meade County.

Form CC-40 Indiana College Credit
The taxpayer may be eligible for up to $100 credit on a single return or $200 on a joint return for contributions to eligible colleges and universities or to corporations and foundations organized and operated exclusively for the benefit of any eligible colleges or universities.

 

See Income Tax Information Bulletin 14 for more information and details.

Name and Code Number Select the name of the College or University from the pulldown list, and the Code number will be automatically entered.
Date

Enter the date of the contribution.

Amount

Enter the amount of the contribution.

Do not include any amounts of tuition or other fees paid to a college or university.

 

Important: The taxpayer must maintain documentation of the taxpayer's contributions as the Department can require the taxpayer to provide this information.

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