Indiana Schedule FIT-NRTC is used by nonresident taxpayers to compute a credit related to taxes paid to their state of commercial domicile that are attributable to Indiana, based on certain qualified loan receipts. If the taxpayer files on a unitary basis, the schedule says the credit must be computed on an individual taxpayer basis. A key eligibility rule is that the principal amount of each loan listed must be more than $2 million to qualify for this credit.
What You Should Have Ready Before Filling It Out
- Your corporation’s legal name and FEIN.
- A list of qualified loans (each with borrower name, principal amount, and receipts attributed to the loan during the year).
- Your total receipts attributable to the nonresident (for the schedule’s apportionment calculation).
- A pro forma schedule showing the Indiana financial institution tax attributable to the nonresident (this must be enclosed).
- The amount of taxes paid to your state of commercial domicile for the qualified loans, net of certain credits that state may allow.
- A copy of your domiciliary state’s tax return to include with Form FIT-20.
How To Complete Schedule FIT-NRTC
Top Header Lines
Department Of Revenue / Indiana Financial Institution Nonresident Tax Credit (See Instructions)
This identifies the schedule and its purpose; you don’t fill these title lines in.
Name Of Corporation
Enter the corporation’s legal name exactly as it appears on your Indiana financial institution tax filing.
Federal Employer Identification Number
Enter the corporation’s FEIN.
Part I: Identification Section
Part I is where you list each qualified loan and the receipts tied to it. If you have more loans than the form lines allow, add extra sheets in the same format.
Column A: Name Of Borrower
For each qualified loan, enter the borrower’s name.
Column B: Principal Amount Of Loan
Enter the original principal amount of the loan (and remember, it must exceed $2 million to qualify for this credit).
Column C: Receipts Attributed To Loan
Enter the receipts attributed to that loan for the tax year (the instructions describe these as receipts less principal attributed to the loan).
Totals
Add Column B and Column C separately and enter the totals on the Totals line.
Part II: Calculation Section
Part II converts your Part I totals into a credit amount, and the schedule states the credit equals the lesser of (1) taxes actually paid to the domiciliary state for the loan transaction or (2) the amount due Indiana for the loan transaction.
Line 1: Enter The Total Receipts From Part I
Enter the total of the “Receipts Attributed To Loan” column from Part I.
Line 2: Enter The Total Receipts Attributable To Nonresident
Enter the total receipts that are attributable to the nonresident for this credit computation.
Line 3: Divide Line 1 By Line 2; Express As A Percentage
Compute Line 1 ÷ Line 2, then write the result as a percentage (the form provides an example format like .5086 = 50.86%). This percentage is the apportionment factor used to attribute receipts from qualified loans to the amount of tax due.
Line 4: Enter The Amount Of Tax Attributable To Nonresident (From A Pro Forma Schedule)
Enter the Indiana financial institution tax due that’s attributable to the nonresident, as shown on your pro forma schedule. Include (enclose) that pro forma schedule with your filing, because the instructions say it must be provided.
Line 5: Multiply The Percentage From Line 3 By The Amount On Line 4
Multiply Line 3 (as a percentage) by the Line 4 amount to compute the credit amount tied to the qualified loan receipts.
Line 6: Enter The Amount Of Taxes Paid To Your State Of Commercial Domicile For The Qualified Loans Listed In Part I
Enter the taxes paid to your domiciliary state for the qualified loans, reduced by any credit that domiciliary state grants for taxes paid to other states.
Line 7: Enter The Lesser Of Lines 5 And 6; Enter This Amount On Line 28 Of Form FIT-20
Compare Line 5 and Line 6, choose the smaller number, and enter it on Line 7. Then carry that Line 7 amount to line 28 of Form FIT-20 as instructed.
What To Attach And Where The Credit Goes
- Enclose the pro forma schedule used to compute the Indiana tax attributable to the nonresident (referenced on Line 4).
- Enclose a copy of your domiciliary state’s tax return with Form FIT-20.
- The final credit amount from Line 7 is reported on line 28 of Form FIT-20.