Indiana Form IT-40 Line by Line Guide
Did you know 9 states do not require residents to pay a personal income tax? Folks that live in Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming, are exempt from this bill. Furthermore, 7 other states simply enforce a flat tax rate. So what's the moral to the story? People who live in these states are able to buy more stuff because they pay less tax.
But for the rest of us, residential income tax is a necessary evil, one that takes a serious bite out of our disposable income. And while the forms are designed to collect the same data, they're all constructed differently. What follows is a breakdown of Form IT-40, the Indiana Individual Income Tax Return. If you don't live in Indiana, not to worry, we'll be tackling the other 34 states soon enough.
Besides some of the finest farmland in the country, Indiana is home to an extremely simple tax form. It doesn't get much easier than 26 lines on 2 measly pages. Therefore, it gets a 9 out of 10 on my user-friendly meter.
Begin by filling in your social security, name, and address at the top of the form. You'll also need your school corporation number (check pages 43 and 44 from the instruction booklet) before you can proceed. Once you fill in the data about the counties in which you live and work, you'll be ready to move on.
On Line 1 enter your adjusted gross income from your federal tax return. You can get this information from Line 37 of your 1040, Line 21 from your 1040A, or Line 4 from your 1040EZ. Now enter the amount from Line 8 of your Federal Schedule 1 on Line 2. Then add Lines 1 and 2 and put the sum on Line 3. Next enter the amount from your federal Schedule 2, Line 12, on Line 4. Now subtract Line 4 from Line 3 and put the total on Line 5.
To figure your exemptions, you must work through your Schedule 3. When you're ready enter the amount from Line 5 of that form on Line 6 of this form. Now subtract Line 6 from Line 5 to get your state taxable income. Next multiply Line 7 by 3.4% to get your state adjusted gross income tax, which goes on Line 8.
On Line 9 enter the county tax due from Schedule CT-40. Then on Line 10 enter any other taxes, you can find this amount on your Schedule 4. Now add Lines 8, 9, and 10 on Line 11. You'll also want to carry forward this number onto Line 15 on page 2. Yep you guessed right, you're more than halfway done.
You'll need the total from Schedule 5 (Line 9) to fill in any credits on Line 12. Then enter your total from Schedule 6 on Line 13. Now add Lines 12 and 13 to get your total Indiana credits and put that amount of Line 11. Remember, you already determined your Indiana Tax when you filled in Line 15.
If Line 14 is smaller than Line 15 skip down to Line 23. If not, subtract Line 15 from Line 14 and enter the total on Line 16. If you donated anything to the Indiana Wildlife Fund enter that amount on Line 17. Now subtract Line 17 from Line 16 to get your overpayment, which then goes on Line 18.
On Line 19 you can declare how much of your overpayment you want applied to next year, just don't forget to enter your county code. If you have a penalty from Schedule IT 2210 or IT-2210A enter that amount on Line 20. Next, subtract Line 18 from Lines 19d and 20 to reveal your refund, this glorious number goes on Line 21. Just don't forget to include your banking information so you can get your money directly deposited.
If Line 15 is greater than Line 14, subtract 14 from 15 and enter the amount on Line 23. This works out to be your Indiana tax liability, so you'll have to include any underpayment penalties on Line 20. If you filed after the due date, you'll incur another penalty with interest, so be sure to file on time. Finish off the section by adding Lines 23 through 25 to get your total bill and enter it on Line 26. All that's left now is just to sign and date your return.
Fin
Provided you've worked through any applicable Schedule's, Indiana's IT-40 is simplicity in of itself. And unlike other states, you won't need a magnifying glass to read the font. Seriously, this form will take you no time at all, so there's no reason to wait till April to file your taxes.
