Indiana Schedule G, officially titled Schedule G: Offset Credits, is a tax schedule issued by the Indiana Department of Revenue for individuals filing Form IT-40PNR, the Indiana Part-Year or Full-Year Nonresident Individual Income Tax Return. For the 2025 tax year, the schedule is identified as State Form 54034, Revision 16 (September 2025). Its primary purpose is to calculate and report eligible offset credits that reduce the taxpayer’s Indiana income tax liability.
The schedule collects information about several categories of tax credits, including credits for local taxes paid outside Indiana, community revitalization enhancement district credits, other local credits, college credits, taxes paid to other states, and additional qualifying credits. It also allows taxpayers to report credits transferred from Schedule IN-OCC. Each credit must be entered in the appropriate section, and certain credits require additional schedules, tax returns, or supporting information.
Schedule G is divided into two main credit groups. Lines 1 through 3 cover local offset credits, which are subject to a limitation based on the county tax due reported on Form IT-40PNR, Line 9. Lines 4 through 7 cover other offset credits, which are subject to a separate limitation based on the state adjusted gross income tax due reported on Form IT-40PNR, Line 8. These two groups must be calculated separately because they have different combined credit limitations.
The schedule also provides designated spaces for taxpayers to enter credit names and corresponding code numbers when reporting certain local or other credits. If additional credits need to be reported, taxpayers may attach separate sheets as instructed. The college credit requires Schedule CC-40, while the credit for taxes paid to other states requires a copy of the other state’s tax return. Credits reported through Schedule IN-OCC must be supported by that schedule.
Completing Schedule G correctly is important because the total allowable offset credits are transferred to Form IT-40PNR, Line 13. However, the total cannot exceed the applicable tax limitations. Taxpayers must verify their credit amounts, follow the combined limitation rules, and include the required supporting schedules before submitting their Indiana nonresident or part-year resident tax return.
How To File Indiana Schedule G
Indiana Schedule G is completed as part of the Form IT-40PNR filing process. It is a supporting schedule used to calculate offset credits that are transferred to the main Indiana income tax return.
The completed Schedule G should be included with the applicable Form IT-40PNR filing. The total allowable offset credits calculated on Schedule G, Line 8, must also be entered on Form IT-40PNR, Line 13.
Who Needs To Complete Schedule G?
Taxpayers filing Form IT-40PNR who qualify for one or more of the offset credits listed on Schedule G may need to complete this schedule.
The relevant credit categories include:
- Local taxes paid outside Indiana.
- Community revitalization enhancement district credits.
- Other qualifying local credits.
- College credits.
- Taxes paid to other states.
- Other eligible offset credits.
- Credits reported through Schedule IN-OCC.
You should report only credits that apply to your tax circumstances and that you are eligible to claim.
Information To Prepare Before Completing Schedule G
Gather the following information before starting:
- Taxpayer name as reported on Form IT-40PNR.
- Social Security Number.
- County tax due from Form IT-40PNR, Line 9.
- State adjusted gross income tax due from Form IT-40PNR, Line 8.
- Amount of qualifying local taxes paid outside Indiana.
- Applicable community revitalization enhancement district credit amount.
- Names, codes, and amounts for other local credits.
- College credit information and completed Schedule CC-40.
- Other-state tax information and a copy of the other state’s tax return.
- Names, codes, and amounts for other qualifying credits.
- Schedule IN-OCC, Line 8, if claiming those credits.
- Additional supporting schedules or sheets, when required.
Make sure the amounts reported on Schedule G agree with the supporting information and the corresponding entries on Form IT-40PNR.
How To Complete Indiana Schedule G
Schedule G contains eight numbered lines, with several lines divided into lettered subsections for reporting individual credits.
The schedule requires taxpayers to round all entries. Enter the applicable dollar amounts in the designated fields and follow the limitations described below.
Taxpayer Identification Information
Before reporting any credits, complete the identification fields at the top of Schedule G.
Name(s) Shown on Form IT-40PNR
Enter the taxpayer’s name exactly as it appears on Form IT-40PNR.
If the return includes more than one taxpayer name, use the names shown on the main tax return.
Your Social Security Number
Enter the Social Security Number associated with the taxpayer filing Form IT-40PNR.
Make sure the number matches the identification information on the main Indiana tax return.
Tax Year
Schedule G is designated for the 2025 tax year. Make sure you are using the schedule that corresponds to the tax year of your Form IT-40PNR filing.
Rounding All Entries
The form instructs taxpayers to round all entries. Apply the required rounding consistently when entering credit amounts.
Local Offset Credits: Lines 1 Through 3
The first section of Schedule G covers local offset credits.
These credits are subject to a combined limitation. The total reported on Lines 1 through 3 cannot exceed the county tax due reported on Form IT-40PNR, Line 9.
This limitation must be checked before calculating the total offset credits.
Line 1: Credit For Local Taxes Paid Outside Indiana
Enter the amount of eligible local taxes paid outside Indiana that qualifies for the applicable credit.
This line is intended for taxpayers who have paid qualifying local taxes to another jurisdiction outside Indiana and are claiming the corresponding credit.
Use the amount supported by the applicable tax and payment records.
The amount entered on Line 1 is included in the combined limitation for Lines 1 through 3.
Line 2: Community Revitalization Enhancement District Credit
Enter the qualifying Community Revitalization Enhancement District credit amount.
This credit relates to eligible tax credit benefits associated with a community revitalization enhancement district.
Enter the amount applicable to the taxpayer for the reporting year.
Include this amount when calculating the combined local credit limitation.
Line 3: Other Local Credits
Use this line to report qualifying local credits that are not separately identified on Lines 1 and 2.
The form provides two entries, Lines 3a and 3b, for reporting different local credits.
If additional local credits need to be reported, attach separate sheets as necessary.
Line 3a: First Other Local Credit
Enter the name of the first qualifying local credit in the designated credit name field.
Enter the corresponding code number in the Code No. field.
Then enter the applicable credit amount in the Line 3a amount field.
Make sure the credit name and code correspond to the applicable credit instructions.
Line 3b: Second Other Local Credit
Enter the name of another qualifying local credit in the designated credit name field.
Provide the applicable code number and corresponding credit amount.
If only one other local credit applies, leave this entry blank.
If additional credits need to be reported beyond the available spaces, include the information on separate sheets as necessary.
Important Combined Limitation For Lines 1 Through 3
The total of Lines 1, 2, 3a, and 3b cannot exceed the county tax due reported on Form IT-40PNR, Line 9.
The calculation is:
Total local offset credits = Line 1 + Line 2 + Line 3a + Line 3b.
The allowable amount must not be greater than the county tax due on Form IT-40PNR, Line 9.
For example, if the combined local credits are greater than the county tax due, the allowable amount must be limited according to the applicable combined limitation instructions.
Do not automatically claim the full amount of local credits if doing so would exceed this limit.
Other Offset Credits: Lines 4 Through 7
The second section covers additional offset credits available to eligible taxpayers.
These credits are subject to a separate combined limitation. The total of Lines 4 through 7 cannot exceed the state adjusted gross income tax due reported on Form IT-40PNR, Line 8.
This limitation is separate from the county tax limitation applied to Lines 1 through 3.
Line 4: College Credit
Enter the eligible college credit amount on Line 4.
Taxpayers claiming this credit must complete and attach Schedule CC-40.
Use the amount calculated on the applicable supporting schedule when entering the credit on Schedule G.
Make sure the amount reported on Line 4 agrees with the supporting Schedule CC-40.
Line 5: Credit For Taxes Paid To Other States
Enter the qualifying credit for income taxes paid to another state.
This credit applies when the taxpayer has paid taxes to another state and qualifies for an Indiana credit for those payments.
You must enclose a copy of the other state’s tax return to support the claim.
Use the applicable amount supported by the other state’s return and the relevant credit calculation.
Do not enter an unsupported amount or simply use the total tax paid without considering the applicable credit calculation.
Line 6: Other Credits
Use Line 6 to report other eligible offset credits that are not separately listed on Lines 4 and 5.
The schedule provides four separate entries, allowing taxpayers to identify multiple credit types.
If additional credits need to be reported, attach separate sheets as necessary.
Line 6a: First Other Credit
Enter the name of the first qualifying credit.
Provide its corresponding code number in the Code No. field.
Enter the applicable credit amount in the designated amount field.
Line 6b: Second Other Credit
Enter the name of the second qualifying credit.
Provide the appropriate code number and the corresponding dollar amount.
If no second credit applies, leave this entry blank.
Line 6c: Third Other Credit
Enter the name of the third qualifying credit, if applicable.
Include its corresponding code number and credit amount.
Ensure that the credit is eligible to be reported in this section.
Line 6d: Fourth Other Credit
Enter the name of the fourth qualifying credit, if applicable.
Provide the corresponding code number and credit amount.
If more than four other credits apply, attach additional sheets containing the necessary credit names, codes, and amounts.
Line 7: Credits From Schedule IN-OCC
Enter the total credits reported on Schedule IN-OCC, Line 8.
You must enclose Schedule IN-OCC with Schedule G to support the amount being claimed.
Make sure the amount entered on Line 7 agrees with Line 8 of Schedule IN-OCC.
Do not enter an independently calculated amount in place of the figure reported on the supporting schedule.
Important Combined Limitation For Lines 4 Through 7
The total of Lines 4, 5, 6a, 6b, 6c, 6d, and 7 cannot exceed the state adjusted gross income tax due reported on Form IT-40PNR, Line 8.
The calculation is:
Total other offset credits = Line 4 + Line 5 + Line 6a + Line 6b + Line 6c + Line 6d + Line 7.
The allowable amount must not be greater than the state adjusted gross income tax due on Form IT-40PNR, Line 8.
For example, if the combined amount of these credits exceeds the state adjusted gross income tax due, the allowable credit must be limited according to the applicable combined limitation instructions.
Remember that the county tax limitation for Lines 1 through 3 and the state tax limitation for Lines 4 through 7 are separate requirements.
Total Offset Credits: Line 8
The final line of Schedule G calculates the total offset credits to be transferred to the main Indiana nonresident or part-year resident income tax return.
Line 8: Total Offset Credits
Add the amounts reported on Lines 1 through 7.
The calculation is:
Total Offset Credits = Line 1 + Line 2 + Line 3 + Line 4 + Line 5 + Line 6 + Line 7.
Include the applicable amounts from the lettered subsections of Lines 3 and 6.
Before entering the final amount, verify both combined limitations:
- Lines 1 through 3 cannot exceed the county tax due on Form IT-40PNR, Line 9.
- Lines 4 through 7 cannot exceed the state adjusted gross income tax due on Form IT-40PNR, Line 8.
Enter the resulting total in the Line 8 amount field.
Then transfer this amount to Line 13 of Form IT-40PNR.
Make sure the amount entered on the main return agrees with the total reported on Schedule G, Line 8.
Important Filing And Calculation Rules
Before submitting Schedule G, review the following requirements to avoid common reporting errors.
Combined Credit Limitations
Schedule G has two separate combined credit limitations.
Local Credit Limitation
Lines 1 through 3 are limited by the county tax due on Form IT-40PNR, Line 9.
State Credit Limitation
Lines 4 through 7 are limited by the state adjusted gross income tax due on Form IT-40PNR, Line 8.
Do not combine these two limitations into one calculation. Each credit group must satisfy its own applicable limit.
Supporting Schedule Requirements
Certain credits require additional documentation.
- College Credit: Attach Schedule CC-40.
- Credit For Taxes Paid To Other States: Enclose the other state’s tax return.
- Other Local Credits: Provide the applicable credit names and code numbers. Attach additional sheets if necessary.
- Other Credits: Provide the applicable credit names and code numbers. Attach additional sheets if necessary.
- Schedule IN-OCC Credits: Enclose Schedule IN-OCC when reporting its Line 8 amount.
Additional Credit Entries
Schedule G provides limited space for reporting other credits.
Line 3 has two entries, while Line 6 has four entries.
If you have additional qualifying credits beyond the available spaces, attach separate sheets as necessary.
Clearly identify each additional credit, its applicable code, and its amount.
Transfer To Form IT-40PNR
The amount reported on Schedule G, Line 8, must also be entered on Form IT-40PNR, Line 13.
Check that both figures match before submitting the tax return.
Final Review Before Filing
Before submitting Indiana Schedule G for the 2025 tax year, review every entry and verify that all applicable supporting documents are included.
Use the following checklist:
- Confirm that you are using the correct 2025 Schedule G.
- Enter the taxpayer’s name exactly as shown on Form IT-40PNR.
- Enter the correct Social Security Number.
- Round all entries as required.
- Verify the amount reported on Line 1 for local taxes paid outside Indiana.
- Check the Community Revitalization Enhancement District credit on Line 2.
- Enter the appropriate credit name, code, and amount on Line 3a, if applicable.
- Enter the appropriate credit name, code, and amount on Line 3b, if applicable.
- Attach additional sheets for other local credits when necessary.
- Confirm that Lines 1 through 3 do not exceed the county tax due on Form IT-40PNR, Line 9.
- Enter the eligible college credit on Line 4.
- Complete and attach Schedule CC-40.
- Enter the credit for taxes paid to other states on Line 5, if applicable.
- Enclose a copy of the other state’s tax return.
- Enter the appropriate credit name, code, and amount on Line 6a, if applicable.
- Enter the appropriate credit name, code, and amount on Line 6b, if applicable.
- Enter the appropriate credit name, code, and amount on Line 6c, if applicable.
- Enter the appropriate credit name, code, and amount on Line 6d, if applicable.
- Attach additional sheets if more other credits need to be reported.
- Enter the total from Schedule IN-OCC, Line 8, on Line 7.
- Attach Schedule IN-OCC.
- Confirm that Lines 4 through 7 do not exceed the state adjusted gross income tax due on Form IT-40PNR, Line 8.
- Add Lines 1 through 7 correctly.
- Enter the total offset credits on Line 8.
- Transfer the Line 8 amount to Form IT-40PNR, Line 13.
- Verify that the amount on Schedule G agrees with Form IT-40PNR.
- Include all required supporting schedules and additional sheets with the tax return.
Final Note: Indiana Schedule G is used to calculate offset credits for eligible taxpayers filing Form IT-40PNR. Accurate reporting requires identifying each applicable credit, entering the correct amounts, following the separate county and state tax limitations, and attaching the required supporting schedules. Before filing, verify that the total on Schedule G, Line 8, agrees with Form IT-40PNR, Line 13.