IN - e-File Mandate and Restrictions

Indiana's e-file mandate went into effect January 1, 2008 and requires all preparers who file 50 or more individual income-tax returns to file those returns electronically:

"Electronic Filing Mandate

If a professional preparer files more than 10 individual income tax returns in a calendar year, for the subsequent year the professional preparer must file returns for individuals in an electronic format, as specified by the Department.

A penalty of $50 may be imposed on the professional preparer for each return that is not filed electronically (see Exception below). The maximum penalty is $25,000 per preparer per calendar year.

Exception: An individual may elect to opt-out of having his/her return electronically filed. Form IN-OPT must be completed, signed and retained on file by the paid preparer. A return filed under these circumstances will not be subject to a penalty for not being filed electronically.

Notification to professional preparer

• This form must be completed if your client(s) refuses to allow you to file his/her Indiana individual income tax return electronically.
• You must keep this completed form on file with your records for five years.
• Do not mail this form to the Indiana Department of Revenue."

 (from the instructions Form IN-OPT, available here)

Note that:

1. The mandate applies to all Indiana returns.
2. Form IN-OPT is available in Drake Tax and will be automatically printed with any return that is not eligible for e-File.

The State of Indiana does NOT support e-filing of the return types listed below. In keeping with Indiana’s e-filing regulations, Drake Tax does not support e-filing of these return types.

1. Amended or corrected returns (IT-40X);
2. Prior year returns (IT-40P);
3. The SC-40, Unified Tax Credit for the Elderly.

See IND 1345, Handbook for Electronic Return Originators and Transmitters of Individual Income Tax Returns, for more information on the State of Indiana’s e-filing regulations and limitations.

Note: S-corp and partnership returns can be e-filed as of Drake15. Corporate returns can be e-filed as of Drake19.