Schedule E (IT‑40 PNR), titled “Other Taxes,” and its embedded companion Schedule IN‑PRO are used by nonresidents and part‑year residents to report additional tax liabilities beyond basic income tax. Schedule E captures items such as sales/use tax on out‑of‑state purchases, household employment taxes, and the recapture of certain Indiana credits. Schedule IN‑PRO is specifically designed for nonresident professional team members (including race team members) to calculate the Indiana county tax due on their modified wage income earned within specific counties. The total county tax calculated on Schedule IN‑PRO flows directly onto line 4 of Schedule E, and the final sum from Schedule E is transferred to line 10 of Form IT‑40PNR, ensuring all “other taxes” are properly added to your total tax bill. This combined form serves as Enclosure Sequence No. 04B.
How to Complete Schedule E / Schedule IN-PRO (IT-40 PNR)
Heading And Identification Area
Start by completing the header so the schedule is correctly linked to your main tax file.
- Name(s) Shown On Form IT‑40PNR
Enter your full name (and spouse’s name if filing jointly) exactly as shown on the front of your IT‑40PNR. - Your Social Security Number
Write the primary taxpayer’s Social Security number just as it appears on the main return.
Completing Schedule IN-PRO: County Tax For Nonresident Team Members
If you are a nonresident professional team member or race team member with income earned in Indiana counties, complete this section first.
The schedule provides rows (1 through 10) to list income by county. For each row:
- Column A: County Code
Enter the 2‑digit code for the Indiana county where the professional services were performed. - Column B: Modified Wage Income
Enter the amount of wage income earned in that specific county (rounded to whole dollars). - Column C: County Tax Rate
Enter the applicable tax rate for that county as a decimal (e.g., 0.0123). - Column D: County Tax
Multiply the amount in Column B by the rate in Column C and enter the result in Column D.
Line 11 – Total County Tax
- Add the amounts from Column D, lines 1 through 10.
- Enter the total on line 11.
- Transfer Instruction: Carry this total directly to Schedule E, line 4.
If you are not a professional team member subject to this tax, you may leave Schedule IN‑PRO blank and skip to Schedule E.
Completing Schedule E: Other Taxes
Schedule E calculates your total additional taxes.
- Line 1 – Sales / Use Tax Due On Out Of State Purchases
If you made purchases from out‑of‑state retailers (online, catalog, etc.) where no Indiana sales tax was collected, calculate the use tax due and enter the amount on line 1. - Line 2 – Household Employment Taxes
If you paid household employees (nannies, housekeepers, etc.) and owe state unemployment or other taxes, enter the amount on line 2.
Note: You must enclose Schedule IN‑H if you use this line. - Line 3 – Recapture Of Certain Indiana Offset Credits
If you are required to pay back (recapture) any previously claimed Indiana credits (such as the CollegeChoice 529 credit), enter the recapture amount on line 3.
Note: You must enclose Schedule IN‑CR if you use this line. - Line 4 – Nonresident Professional Team Member’s County Tax
Enter the total county tax you calculated on Schedule IN‑PRO, line 11. - Line 5 – Total Other Taxes
Add the amounts from lines 1 through 4.
Enter the total on line 5.
Transfer Instruction: Enter this final total on Form IT‑40PNR, line 10.
Once completed, attach Schedule E / Schedule IN‑PRO to your return as Enclosure Sequence No. 04B.