Indiana Hoosier Business Investment Tax Credit
Indiana Economic Development Corporation (IEDC)
Up to 10% (25% for logistics)
Indiana's discretionary capital investment tax credit
Indiana's capital investment tax credit — awarded to businesses that make qualifying personal property or real property investments in Indiana to support job creation and economic growth. The HBITC is a discretionary credit negotiated with IEDC based on the level of investment and associated job creation. The credit offsets Indiana corporate income or financial institutions tax, with excess credits carrying forward up to 10 years. Standard rate is up to 10% of qualified investment; logistics-related investments may qualify for up to 25%. It is the state's primary tool for incentivizing manufacturing equipment purchases and facility investments.
- Funding type
- Tax Credit
- Level
- State
- Amount
- Credit equals up to 10% of qualified investment in Indiana personal property or real property (manufacturing equipment, machinery, and qualifying facility improvements). Logistics-related investments may qualify for up to 25% credit rate. Actual credit rate is negotiated by IEDC based on investment size, job creation, and economic impact — rates commonly range from 3–10% of qualified investment (3–25% for logistics). A $5M equipment investment at 8% = $400,000 credit. Credits carry forward up to 10 years.
- Realistic amount
- A manufacturer investing $5M in new equipment at a 6% HBITC rate earns $300,000 in credits over the earning period (typi…
- Deadline
- Rolling — applications evaluated year-round by IEDC. Must be approved before qualifying investment commences.
- Status
- active
- States
- IN
- Payment model
- tax offset
Who qualifies
- Business must make qualifying investment in Indiana personal property (manufacturing equipment, machinery, computers, tooling) or real property (qualifying facility construction or renovation)
- Investment must be associated with job creation or retention in Indiana — IEDC evaluates both components together
- Business must demonstrate that the IEDC credit is a factor in the investment decision for Indiana
- IEDC must approve the credit award before qualifying investment commences (pre-commencement timing)
- Company must execute a HBITC agreement with IEDC specifying investment commitments, job targets, credit rate, and verification schedule
- Business must be subject to Indiana corporate income tax or financial institutions tax
- Credits carry forward up to 10 years for companies that cannot immediately absorb them against IN tax liability
Hard requirements
- Must be incorporated
What it covers
Eligible expenses
- Indiana personal property: manufacturing equipment, machinery, computers, tooling, and other depreciable business assets placed in Indiana service
- Indiana real property: construction of new manufacturing facilities, distribution centers, or qualifying business buildings in Indiana; renovation of existing Indiana facilities for qualifying use
- Qualifying investment associated with net new job creation or retention in Indiana
Ineligible expenses
- Equipment or machinery already purchased before IEDC agreement execution
- Inventory (not depreciable business assets)
- Working capital or operating expenses
- Investments in states other than Indiana
- Real property used for retail trade, food service, or residential purposes
- Goodwill and intangible assets
How to apply
-
1
Contact IEDC Business Development during investment planning
Reach out to IEDC during active equipment procurement planning or facility construction planning. IEDC can indicate likely credit rate and terms before formal application. Must be before purchase orders are issued or construction begins.
~7 hrs
-
2
Submit HBITC application to IEDC
Complete the IEDC application with qualifying investment detail (asset types, purchase schedule, Indiana location), associated job creation projections and wages, and 'but for' justification for Indiana location.
~7 hrs
-
3
IEDC structures credit offer and Board approves
IEDC negotiates the credit rate (3–10% of qualified investment) based on investment size, job quality, and economic impact. IEDC Board formally approves the award. Allow 4–8 weeks from application to Board approval.
~7 hrs
-
4
Execute HBITC agreement with IEDC
Sign the agreement establishing investment commitments, job targets, credit rate, earning schedule, verification requirements, and clawback provisions for underperformance.
~7 hrs
-
5
Make qualifying investment and claim credits on Indiana tax return
IEDC verifies investment annually. Credits are earned as verified investment milestones are met and claimed on Indiana consolidated income tax return (IT-20). Carry-forward credits applied in subsequent years.
~7 hrs
HBITC pairs best with Indiana's Skills Enhancement Fund — if your investment creates manufacturing jobs requiring specialized training, combining both programs maximizes your Indiana package. The 10-year credit carryforward is generous by national standards.
Deadline & timing
IEDC must approve the HBITC before the company makes the qualifying investment — retroactive credits are not awarded. IEDC Board approval is required for most awards. Credits are earned over the agreement period (typically 2–5 years) as investment is verified.
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Last reviewed 2026. GrantCompass is an independent funding-discovery tool and is not affiliated with any government agency. Always confirm details on the official program page.