Bill > SB0213

This bill establishes a new income tax deduction for theft losses incurred by individuals in Indiana, effective retroactively for taxable years beginning after December 31, 2023. It defines "theft" as an event that would have qualified for a theft loss deduction under federal law (specifically Section 165(c) of the Internal Revenue Code as it existed on January 1, 2017) and involved a distribution from a "qualifying account" (which includes retirement plans, securities, commodities, savings, or checking accounts owned by an individual) or a sale of financial instruments, followed by a payment to another party within sixty days, where the transaction was induced by that party. The deductible "theft loss" is the amount an individual could have deducted federally but was not permitted to deduct for federal adjusted gross income purposes. Crucially, before a taxpayer can claim this deduction on their state tax return, they must first apply to the Department of State Revenue for certification of the theft loss, providing all requested information, and can only claim the deduction up to the amount certified by the department. The bill also outlines procedures for protesting the department's determination and specifies how recoveries from insurance or reimbursements will affect the deduction, including potential additions to income in subsequent years.

Budget and Finance

https://iga.in.gov/legislative/2026/bills/senate/213/details