1. (a) As used in this chapter, "incremental income tax withholdings" means either:

   1. (1) the total amount withheld under IC 6-3-4-8 by the taxpayer during the taxable year from the compensation of new employees; or

   2. (2) the sum of:

      1. (A) the total amount withheld under IC 6-3-4-8 by the taxpayer during the taxable year from the compensation of new employees; plus

      2. (B) the additional amount that would have been withheld under IC 6-3-4-8 by the taxpayer during the taxable year from the compensation of new employees as if the new Indiana nonresident employees had been Indiana residents;

         as determined by the corporation.

2. (b) The term does not include any amount withheld from an individual or an additional amount described in subsection (a)(2) for an individual for services provided in Indiana as an employee, if the:

   1. (1) individual was, during the period of service, prohibited from being hired as an employee under 8 U.S.C. 1324a; and
   2. (2) taxpayer was not enrolled and participating in the E-Verify program (as defined in IC 22-5-1.7-3 ) during the time the taxpayer conducted business in Indiana in the taxable year.

As added by P.L.41-1994, SEC.1. Amended by P.L.171-2011, SEC.5; P.L.158-2019, SEC.11.