Class three is the category of taxation for the dealer. NO short rifle, shotgun, silencer, full auto, destructive device, etc., needs a "class three permit" to get. You pay a one-time $200 tax to receive a stamp on a paper form. The stamp and form is proof you're legal for that item on the form, whether it be a short barreled rifle or whatnot. Each NFA item needs its own stamp.
SBRs are allowed in IN, so far as I know.
The process is simple. Fill out a "form 1" (5320.1, found here http://www.atf.gov/forms/download/atf-f-5320-1.pdf
) in duplicate, fill out a 5330.20 (http://www.atf.gov/forms/download/atf-f-5330-20.pdf
), get the form 1 signed by the CLEO, get fingerprints taken, send the forms, fingerprint card, and a $200 check to the address on the form 1. Wait a few months, and you'll get one of the form 1 copies back, with a $200 NFA stamp (canceled of course) affixed. At that point, the firearm must be marked with the indicated data from the form (you can do this prior to receiving the form back, of course - engraving can take a bit of a wait depending on the engraver), and then you can have the short barrel installed.
It's just a waiting game, but it's much easier than most people think.
Some great reading:
<- this has a selection of examples and descriptions to help understand what's called what in the NFA world.