Sales Tax Exemptions Available for Professional Racing Teams in Indiana

Friday, April 27th, 2012

 
 
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Indiana
General

The Indiana Department of Revenue recently issued an Information Bulletin discussing the taxability of items purchased by professional motor racing teams and owners of two-seater Indianapolis 500-style race cars. Ind. Sales Tax Info. Bull. No. 67 (Dept. of Revenue Apr. 2012). The "purchase, lease or operation of a qualified part of a motor racing vehicle . . . by professional racing teams are exempt from Indiana sales and use tax." However, tires and tire accessories are specifically excluded from the exemption and are therefore subject to tax. Additionally, the owner, lessee, or operator of a company that participates in the sport of competitive racing during competitive racing events will also qualify for the exemption when purchasing qualifying tangible personal property that "comprises any part of a two-seater Indianapolis 500-style race car." (Ind. Code Ann. sec. 6-2.5-5-37).

For purposes of the exemption, the following terms are defined as follows:

  • Professional Racing Team: Those racing operations qualified to file under the Internal Revenue Code as for-profit businesses.
  • Accessories: Any and all instrumentation and telemetry equipment that is not permanently attached to the racing vehicle. Accessories also include consumables and all elements of motor vehicle driver's protective clothing and headgear. Accessories do not include instrumentation and telemetry equipment permanently affixed to the racing vehicle.

Any Indiana-based professional racing team or owner, operator, or lessee of a two-seater Indianapolis 500-style race car looking to take advantage of the exemption must indicate so on Form ST-105 General Sales Tax Exemption Certificate, which is available on the Department of Revenue's website.


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