Bill > SB0407

This bill establishes a tax credit for employers in Indiana who employ members of military reserve components or the Indiana National Guard, designed to support businesses that retain employees serving in these roles. The credit applies when a qualified individual (a military reservist or National Guard member residing in Indiana) is training, drilling, or on active duty during their normal working hours. The tax credit is calculated by multiplying the hours of military service during normal work time by the employee's hourly wage, then multiplying that result by 0.5. Employers cannot claim the credit if the employee uses paid leave during their military service. The credit can be applied against various state tax liabilities and can be carried forward to subsequent tax years, though it cannot be carried back or refunded. For pass-through entities that cannot use the entire credit, individual shareholders, partners, or members can claim a proportional credit based on their share of the entity's distributive income. The bill is retroactively effective for taxable years beginning after December 31, 2024, and will expire on July 1, 2028, with an emergency clause indicating its immediate importance.

Budget and Finance, Military Affairs and Security

https://iga.in.gov/legislative/2025/bills/senate/407/details