If your LLC or Corporation was incorporated in Indiana, your business is known as a "domestic" business. If your LLC or Corporation was incorporated in any other state, you're known as a "foreign" business. A foreign business must qualify and register to do business in another state. A company that has a physical presence in a state or repeatedly engages in business transactions in that state is conducting business in that state.
If you conduct any of the following transactions in Indiana, you are considered as conducting business in the state:
- Have sales of goods or services
- Provide services or labor
- Perform construction work
- Have employees working in the state
- Own or rent real property
- Own warehouses in Indiana that ship to customers in the state
Any business meeting these qualifications must register with the Department of Revenue. This registration can be completed in INBiz. After your business is registered in Indiana, you will begin paying state and local income taxes on any profits earned in Indiana and sales tax on any tangible property sold or shipped from the state. Corporations must pay the Indiana Corporate Income Tax, but LLC businesses avoid double taxation. All foreign businesses must adhere to Indiana's employment tax requirements.
Note that Indiana law (IC 6-2.5-2-1(c)) requires a seller without a physical location in Indiana to obtain a registered retail merchant's certificate, collect and remit applicable sales tax if the seller meets either or both of the following conditions in the previous calendar year or the current calendar year:
- You have gross revenue from sales into Indiana exceeding $100,000; or
- You have 200 or more separate transactions into Indiana.
Sales into Indiana or sales transactions include any combination of sales of tangible personal property delivered into Indiana, products transferred electronically into Indiana and services delivered in Indiana.
You may go to the Indiana Department of Revenue webpage for more information.
For purposes other than sales tax, your business may be subject to other taxes such as income or withholding taxes. If you conduct any of the following activities in Indiana, you may be considered to be doing business in the state:
Maintenance of an office or other place of business in the state
Maintenance of an inventory of merchandise or material for sale distribution, or manufacture, or consigned goods in the state
Sale or distribution of merchandise to customers in the state directly from company-owned or operated vehicles where title to the goods passes at the time of sale or distribution
Rendering services to customers in the state
Ownership, rental or operation of a business or of property (real or personal) in the state
Acceptance of orders in the state
Any business meeting these qualifications must register with the Department of Revenue.
Businesses having employees in the state must register to remit withholding tax to the Department of Revenue and if the employees are engaging in activities beyond the solicitation sales, the business or its owners will owe Indiana corporate or individual income tax regardless as to whether the business is engaging in any of the other activities listed above.
These registrations can be completed in INBiz. All businesses with Indiana employees must also adhere to Indiana's employment tax requirements.