Indiana Exempts Blood Glucose Monitors and Olympic Medals
- Sales Tax News
- Apr 4, 2014 | Gail Cole
A new law in Indiana covers a variety of topics: blood glucose monitoring devices, Olympic medals and prize money, and rounding taxes. Senate Bill 161 was signed by Governor Mike Pence (R) on March 25, 2014.
Blood glucose monitoring meters
This section of the new law, which helps the state to conform to the Streamlined Sales and Use Tax Agreement, takes effect July 1, 2014.
Blood glucose monitoring meters are removed from the definition of “blood glucose monitoring supply.”
“Diabetic supply distributor” is defined as “a person that primarily sells blood glucose meters for resale and not for retail sale.”
“Blood glucose meters and the packaging or literature for a blood glucose meter furnished without charge by a diabetic supply distributor” are exempt from the state gross retail tax.
Blood glucose meters are also exempt from sales tax when prescribed by a physician.
Rounding the tax
Indiana has a single state sales tax rate (7%) and no local rates. Under current law when “the gross retail income received by a retail merchant in a retail unitary transaction… carried to the third decimal place results in the numeral in the third decimal place being greater than four (4), the amount of tax shall be rounded to the next additional cent.”
The new law, effective July 1, 2014, allows sellers to “round the tax” referenced above on a transaction on an item basis or an invoice basis.”
However, the law stipulates that “a seller may not round the tax [on an item basis] to circumvent the tax that would otherwise be imposed on a transaction using an invoice basis.”
Olympic medals and prize money
Effective for taxable years beginning after December 31, 2013, Olympians are entitled to an exemption from the adjusted gross income tax equal to the sum of:
- The value of an Olympic medal won during the taxable year;
- The amount of income received during the taxable year from the United States Olympic Committee as prize money for winning the Olympic medal.
Dealing with change
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