Indiana § 36-8-19-7.5 - Local option and excise taxes; allocation to economic development; distributions to participating units; clerical and mathematical adjustments

§ 36-8-19-7.5. Local option and excise taxes; allocation to economic development; distributions to participating units; clerical and mathematical adjustments

Sec. 7.5. (a) This section applies to:

(1) local income tax distributions; and

(2) excise tax distributions;

made after December 31, 2009.

(b) Except as provided in subsection (c), for purposes of allocating local income tax distributions that are based on a taxing unit's allocation amount before January 1, 2029, or that an adopting body allocates under IC 6-3.6-6 to economic development before January 1, 2029, or excise tax distributions that are distributed based on the amount of a taxing unit's property tax levies, each participating unit in a territory is considered to have imposed a part of the property tax levy imposed for the territory. The part of the property tax levy imposed for the territory for a particular year that shall be attributed to a participating unit is equal to the amount determined in the following STEPS:

STEP ONE: Determine the total amount of all property taxes imposed by the participating unit in the year before the year in which a property tax levy was first imposed for the territory.

STEP TWO: Determine the sum of the STEP ONE amounts for all participating units.

STEP THREE: Divide the STEP ONE result by the STEP TWO result.

STEP FOUR: Multiply the STEP THREE result by the property tax levy imposed for the territory for the particular year.

(c) This subsection applies to a determination under subsection (b) made in calendar years 2018, 2019, and 2020. The department of local government finance may, for distributions made in calendar year 2022, adjust the allocation amount determined under subsection (b) to correct for any clerical or mathematical errors made in any determination for calendar year 2018, 2019, or 2020, as applicable, including the allocation amount for any taxing unit whose distribution was affected by the clerical or mathematical error in those years. The department of local government finance may apply the adjustment to the allocation amount for a taxing unit over a period not to exceed ten (10) years in order to offset the effect of the adjustment on the distribution.

(d) This subsection applies to a territory established by an ordinance or a resolution adopted under this chapter after December 31, 2024. Before additional revenue from a local income tax rate may be allocated to the provider unit of a new territory due to an increased property tax levy resulting from the establishment of the territory, the county fiscal body must adopt an ordinance or resolution approving the allocation.

As added by P.L.182-2009(ss), SEC.442. Amended by P.L.197-2016, SEC.147; P.L.247-2017, SEC.33; P.L.38-2021, SEC.100; P.L.68-2025, SEC.241; P.L.157-2026, SEC.277.