![]() ![]() ![]() In addition to the state-level corporate tax, Indiana corporations are also liable for federal income tax. You may also have to submit additional papers at the state level. In order to get a tax-exempt status in Indiana, you must first qualify under section 501(c) of the IRC and obtain a tax-exempt identity number from the Internal Revenue Service (IRS). Charities (whether religious or non-religious).Nonprofit recreational organizations and social clubs.Religious organizations, including churches, mosques, and synagogues.Labor unions and workers' organizations.Educational institutions, including schools, colleges, and research organizations.These are a few types of 501(c) exempt organizations: For example, Indiana exempts certified 501(c) corporations from paying corporate income tax. Tax Exemptions for Nonprofits in IndianaĬertain nonprofit Indiana entities may qualify for partial or full exemption from paying state and federal income taxes. However, the owners must include their share of business income while filing their individual tax returns.Īll incorporated businesses in Indiana must file a tax return with the IRS and the state, regardless of whether they are liable for any taxes or not. Since corporate taxes do not apply to flow-through entities like S-Corporations, these businesses are not subject to double taxation. Thus, profits of a C-Corporation taxed twice. In addition to the corporate income taxes paid by a C-Corporation, the owners, or shareholders, also pay income tax on the distributed income they receive from the company. Sole proprietorships, partnerships, and S-Corporations are examples of flow-through entities.Ĭ-Corporation is the most common business structure that is subject to corporate taxes. A flow-through entity is one where business income passes through to the owner's personal tax return. You can deduct business expenses like wages, rent, and costs associated with the sale of goods.Įxcept for flow-through entities, almost all businesses in Indiana must pay federal and state corporate income taxes. Businesses in Indiana must file an annual tax return. Indiana corporate income tax is charged on the income of corporations and businesses registered or operating in the state of Indiana. ![]()
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