Key figures
Indiana accounting
2026, with sources
A 4.9% tax, apportioned by receipts
Indiana’s corporate adjusted gross income tax has been 4.9% since July 1, 2021, after a decade of annual cuts from 8.5%. It is apportioned by a single receipts factor. Indiana is a separate-filing state: each corporation files its own IT-20 unless the group petitions DOR, within 30 days after year end, for permission to file a combined unitary return limited to the water’s edge.
The IT-20 is due on the 15th day of the 5th month after year end — May 15 for a calendar-year company, a month after the federal return — and Indiana accepts the federal extension. Estimates are required once the year’s liability exceeds $2,500, due on the 20th day of the 4th, 6th, 9th and 12th months.
Fixed-date conformity and research costs
Indiana adopts the Internal Revenue Code as of a date the General Assembly sets, rather than as it changes. Its 2025 IT-20 booklet followed the Code as of January 1, 2023, and adds back bonus depreciation. Research costs are the exception that runs in a taxpayer’s favor: since 2023 Indiana has let specified research expenditures from 2022 through 2024 be deducted in full in the year first deductible for federal purposes, with the federal amortization added back in later years.
DOR’s Information Bulletin #127 (June 2026) extends that treatment to 2025 and later: domestic research costs expensed federally need no Indiana adjustment, and foreign research costs, still amortized federally, are deducted in full for Indiana with the amortization added back.
What this means for the books
Take a 15-person Indianapolis software company that capitalized $1 million of research costs in 2023 for federal purposes. For Indiana it deducted the full $1 million in 2023, and from 2024 through 2028 it adds back each year’s federal amortization. That creates an Indiana-only deferred tax liability that unwinds over five years, and a state NOL in 2023 larger than the federal one. If it took the federal option to accelerate the remaining 2022–2024 amortization in 2025, the accelerated amount is an Indiana addback in the year deducted.
Deadlines
- 15th day of the 5th month after year end — May 15Corporate adjusted gross income tax return; Indiana accepts the federal extensionForm IT-20
- 20th day of the 4th, 6th, 9th and 12th monthsQuarterly estimates when the year’s liability exceeds $2,500Form IT-6
The federal baseline
This page covers what Indiana adds. The federal rules underneath it apply here too.
Common questions
Do we amortize R&D for Indiana like we did federally?
No — Indiana went the other way. Since 2023 Indiana has let taxpayers deduct specified research expenditures from 2022 through 2024 in full in the year they were first deductible federally, then add back the federal amortization as it is taken. For domestic research costs from 2025 on, which the federal return now expenses, no Indiana adjustment is needed; foreign research costs, still amortized federally, are deducted in full for Indiana.
Do we file a combined return for our parent and subsidiary?
Not by default. Indiana corporations file separately unless they petition DOR, within 30 days after the end of the tax year, for permission to file a combined unitary return; permission is granted when combined reporting more fairly reflects Indiana income, and combined groups stay at the water’s edge.
Accounting next door
- ILIllinois accountingIllinois taxes a C corporation’s income at 7% plus a 2.5% replacement tax, apportioned by a single sales factor and filed as a combined unitary group.
- KYKentucky accountingKentucky taxes corporations at 5% plus a limited liability entity tax with a $175 minimum, requires unitary combined returns, apportions on single sales factor, and decouples from bonus depreciation and Section 174A.
- MIMichigan accountingMichigan taxes C-corps at 6% on a single sales factor once Michigan receipts reach $350,000, and decoupled from the federal R&D expensing change, so research costs are still amortized over five years for Michigan.
- OHOhio accountingOhio has no corporate income tax; its 0.26% Commercial Activity Tax excludes the first $6 million of Ohio receipts, so the business tax a startup actually meets is its city’s net profit tax.
Founder guides on this
- R&D taxThe R&D tax credit and Section 174A for startupsEngineering salaries can earn a federal R&D credit against payroll tax, and Section 174A lets you deduct US research again. What qualifies, what to track.
- US GAAPUS GAAP for early-stage startups, in plain EnglishAccrual accounting, revenue recognition (ASC 606), leases (ASC 842), stock compensation and capitalized software: what each means for a small company.
- FundraisingAudit-ready books before your Series AInvestors, lenders and auditors ask for the same things: accrual statements, reconciled accounts and support for every balance. How to be ready first.
More of the Indiana guide
- ReceivablesReceivables and sales tax in IndianaSales tax registration, economic nexus, whether SaaS is taxable, and collecting from customers
- PayablesPayables and contractors in IndianaPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- PayrollPayroll taxes and employer rules in IndianaWithholding, unemployment insurance, paid leave, minimum wage and the rules on paydays
- ComplianceCompliance and filings in IndianaRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in IndianaCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.