Instructions For Form Fit-20 - Indiana Financial Institution Tax Return - 2011 Page 4
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28(6) Regularly engages in transactions with customers in
(d) An interest in the right to service or collect income
Indiana involving intangible property, including loans, but
from a loan or other asset where interest on the loan is
not property described in IC 6-5.5-3-8(5), and resulting in
attributed as a loan described above and the payment
receipts flowing to the taxpayer from within Indiana;
obligations were solicited and entered into by a person
(7) Owns or leases tangible personal or real property located
who is independent and not acting on behalf of the
in Indiana; or
owner.
(8) Regularly solicits and receives deposits from customers in
(e) An amount held in an escrow or trust account with
Indiana.
respect to the property described previously.
(6) Acting
“Regularly, ” for purposes of the previously listed tests, is defined as
(a) As an executor of an estate;
assets attributable in Indiana equal to at least $5 million or 20 or
(b) As a trustee of a benefit plan;
more Indiana customers.
(c) As a trustee of an employee’s pension, profit sharing, or
other retirement plan;
(d) As a trustee of a testamentary or inter vivos trust or
Exempt Entities
corporate indenture; or
Four specific types of organizations are exempted from the
(e) In any other fiduciary capacity, including holding title
franchise tax: insurance companies, international banking
to real property in Indiana.
facilities, S corporations exempt from income tax under IRC
Section 1363, and nonprofit corporations (with the exception of
Method of Reporting
state chartered credit unions). Federal law prohibits state taxation
A taxpayer is allowed to file a separate return only in those
of federally chartered credit unions.
instances where the taxpayer is not a member of a unitary group.
Members of a unitary group must file collectively on one combined
Exempt Transactions
return. No provision is made for filing consolidated returns.
A taxpayer is not considered to be transacting business in Indiana
If the taxpayer is a member of a group, combined reporting is
if the ONLY activities of the taxpayer in Indiana are in connection
mandatory. However, if the taxpayer determines that its Indiana
with any of the following:
income is not accurately reflected by the filing of a combined
(1) Maintaining or defending an action or a suit;
(2) Filing, modifying, renewing, extending, or transferring a
return, the taxpayer can petition the Department by indicating
on its annual return that the return is a separate return made by a
mortgage, deed of trust, or security interest;
member of a unitary group. Such petition is subject to approval by
(3) Acquiring, foreclosing, or otherwise conveying property
the Department. The petition must include the name and federal
in Indiana as a result of a default under the terms of a
mortgage, deed of trust, or security interest relating to the
identification number of each member of the group petitioning for
an alternative method. Each member must include its justification
property;
for the alternative method.
(4) Selling tangible personal property, if taxation under this
law is precluded because of federal law relating to interstate
Petitions can also be sent to:
commerce;
Indiana Department of Revenue
(5) Owning an interest in the following types of property
Tax Policy Division
even though activities are conducted in Indiana that
100 N. Senate Ave.
are reasonably required to evaluate and complete the
Room N248
acquisition or disposition of the property, the servicing
Indianapolis, IN 46204
of the property, or the income from the property, or the
acquisition or liquidation of collateral relating to the
Members of a Unitary Group
property:
The combined return shall include the adjusted gross income of all
(a) An interest in a real estate mortgage investment
members of the unitary group that are transacting business wholly
conduit, a real estate investment trust, or a regulated
or partially within Indiana. The statute provides exclusion for
investment company.
the income of corporations or other entities organized in foreign
(b) An interest in a loan-backed security representing
countries, except a federal or state branch of a foreign bank or its
ownership or participation in a pool of promissory
subsidiary that transacts business in Indiana.
notes or certificates of interest providing for payments
“Unitary business” means business activities or operations that
in relation to payments or reasonable projections of
are of mutual benefit, dependent upon or contributory to one
payments on the notes or certificates.
another, individually or as a group, in transacting the business of a
(c) An interest in a loan or other asset where the interest
financial institution. The term can be applied within a single entity
is attributed to a consumer loan, commercial loan,
or between multiple entities and without regard to whether each
or secured commercial loan and where the payment
entity is a corporation, partnership, or trust. Unity is presumed
obligations were solicited and entered into by a person
if there is unity of ownership, operation, or use as evidenced
who is independent and not acting on behalf of the
by centralized purchasing, advertising, accounting, or other
owner.
controlled interaction among entities that are members of the
unitary group as defined in IC 6-5.5-1-18(a).
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