Current through March 20, 2024
Authority: IC
6-1.1-12.1-13;
IC
6-1.1-31-1
Affected: IC 6-1.1-12.1
Sec. 6.
(a)
"Qualifying machinery and equipment" means tangible property used in the direct
production, manufacture, fabrication, assembly, extraction, mining, processing,
refining, or finishing of other tangible personal property as follows:
(1) As used in this subsection, "production,
manufacture, fabrication, assembly, extraction, mining, processing, refining,
or finishing" is a comprehensive description of the various means of production
and circumscribes all of the operations or processes by which a finished
product is derived.
(2) As used in
this subsection, "direct", within the phrase "used in the direct production,
manufacture, fabrication, assembly, extraction, mining, processing, refining,
or finishing of other tangible personal property", means an essential or
integral part of the operation or process that leads to the creation of other
tangible personal property.
(3) The
conversion of a solid waste or a hazardous waste into energy or other useful
products constitutes use in the direct production, manufacture, fabrication,
assembly, extraction, mining, processing, refining, or finishing of other
tangible personal property.
(b) Personal property will be qualifying
machinery and equipment when it is used within the process that chronologically
begins with the material handling equipment that carries or moves the raw
material from its on-site storage location to the first machine or production
step and ends with the material handling equipment that carries or moves the
finished product from its final machine or production step to the in-plant
finished good storage site.
(c)
Examples of personal property that may be considered qualifying machinery and
equipment include, but are not limited to, the following:
(1) Computer equipment, if used directly to
control equipment directly used in the manufacturing process.
(2) Laboratory equipment, if used directly to
test the tangible personal property being produced.
(3) Testing and inspection equipment,
including quality control equipment, used to ensure the specifications or
quality of the tangible personal property being produced. However, the
equipment must be used:
(A) as part of the
production process; and
(B) to test
or inspect the tangible personal property being produced.
(4) Shelves, racks, or other temporary
storage facilities or containers used to transport or convey work-in-progress
from one (1) step in the production process to another step in the production
process, or for the temporary storage of work-in-progress between one (1) step
in the production process to another step in the production process.
(d) Examples of personal property
that will not be considered qualifying machinery and equipment include, but are
not limited to, the following:
(1) Computer
equipment, if used for such functions as administration, payroll, bookkeeping,
drafting, production scheduling, or inventory control.
(2) Furniture and fixtures, such as office
furniture, telephones and telephone equipment, break room fixtures, and
employee lockers.
(3) Maintenance
equipment used to repair production equipment.
(4) Licensed transportation
vehicles.
(5) Warehouse racks,
shelving, or other equipment used to store either raw materials or finished
goods.
(6) Equipment used in
research and development, including computer equipment used in research and
development.
(e) If
computer equipment, or other personal property, is both used in direct
production and is also used for purposes other than direct production, an
allocation shall be made between its use in direct production and its use for
purposes other than direct production.
