Hoosiers will see a total refund worth $545.3M when they file their 2021 state tax returns next year. Per Indiana state law, if Indiana’s reserves are 12.5% of general fund appropriations or higher (excluding K-12 education reserves), Hoosiers get the surplus back in the form of a tax credit. This year’s reserves are an estimated 23% of expenditures.
The surplus is to be divided equally among taxpayers who filed in 2021. The last time a credit was given to Hoosier taxpayers, it was a $360M surplus distributed in 2013, which equaled a $111 credit per taxpayer. The surplus is higher this year, but the state will not know the total number of Hoosier filers until later this year. Once calculated, the state will announce the total credit per taxpayer. The last surplus was intentional, based on a budget from then-governor Mitch Daniels. This year’s surplus was a surprise to Governor Eric Holcomb’s administration. If you (and/or your spouse)
- timely filed a 2020 full-year resident Indiana income tax return,
- timely file your 2021 full-year resident Indiana income tax return, and
- have a modified state tax liability for 2021,
Then you may be eligible to share in the automatic taxpayer refund credit. Contact us for more information for this or other state credits.