Sec. 8. (a) If a corporation is:

(1) transacting the business of a financial institution (as defined in IC 6-5.5-1-17(d)); and

Terms Used In Indiana Code 6-5.5-2-8

  • Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
  • business of a financial institution: means the following:

    Indiana Code 6-5.5-1-17

  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Grantor: The person who establishes a trust and places property into it.
  • gross income: includes income from interest, fees, penalties, a market discount or other type of discount, rental income, the gain on a sale of intangible or other property evidencing a loan or extension of credit, and dividends or other income received as a means of furthering the activities set out in this subdivision. See Indiana Code 6-5.5-1-17
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Taxpayer: means a corporation that is transacting the business of a financial institution in Indiana, including any of the following:

    Indiana Code 6-5.5-1-17

(2) is a partner in a partnership or the grantor and beneficiary of a trust transacting business in Indiana and the partnership or trust is conducting in Indiana an activity or activities that would constitute the business of a financial institution if transacted by a corporation;

the corporation is a taxpayer under this article and shall, in calculating the corporation’s tax liability under this article, include in the corporation’s adjusted or apportioned income the corporation’s percentage of the partnership or trust adjusted gross income or apportioned income.

     (b) A partnership or trust covered by subsection (a):

(1) shall file an information return on an appropriate schedule, with capital and operating losses, modifications, and credits required by this article and any other items specified in the return form by the department. If the taxpayer is a nonresident, or is a member of a unitary group with nonresident members filing a combined return, the return must show the apportionment percentage and supporting amounts necessary to compute the tax under IC 6-5.5-4. A partner’s percentage share of the receipts of a taxpayer, for the purpose of apportionment, shall be calculated by using the partner’s share of the partnership adjusted gross income;

(2) is subject to the provisions of IC 6-5.5-7-3 relating to taxpayers and IC 6-5.5-7-4 relating to persons when filing the information return; and

(3) shall withhold from all nonresident corporate partners or beneficiaries an amount prescribed in withholding instructions issued by the department. The amount required to be withheld shall be based upon the rate of tax prescribed in IC 6-5.5-2, unless the partner or beneficiary provides the partnership or trust with a written declaration that the partner or beneficiary is not subject to the tax. In such a case the amount withheld shall be the amount prescribed in the withholding instructions issued by the department based upon the Indiana adjusted gross income tax rates. The department shall issue procedures and directions for the withholding required by this subsection that are similar to those contained in IC 6-3-4 concerning the withholding of taxes.

As added by P.L.21-1990, SEC.26. Amended by P.L.68-1991, SEC.9.

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