Indiana income tax brackets for 2026
Indiana taxes wages at a flat 2.95%. The rates apply to taxable income: your wages after pre-tax deductions and the deductions and exemptions shown below.
| All filing statuses: taxable income | Rate |
|---|---|
| Over $0 | 2.95% |
Deductions, exemptions and credits
| Personal exemption | $1,000 single · $2,000 married |
|---|---|
| Dependent exemption | $1,500 each |
- Indiana's flat rate fell from 3% to 2.95% on January 1, 2026, and is set to drop to 2.9% in 2027.
- All 92 counties add a local income tax on top, so most Indiana workers pay between about 3.5% and 6% in total.
No Indiana payroll deductions
Indiana does not take disability, paid leave or unemployment contributions from employees. State unemployment insurance is paid by employers, so the only deductions from a Indiana paycheck are federal taxes, Indiana income tax and anything you choose, such as 401(k) contributions or health insurance.
Local income taxes in Indiana
Every Indiana county charges its own income tax, from 0.5% (Porter County) to 3.0% (Randolph County). Marion County (Indianapolis) is 2.02%, Hamilton 1.1% and Lake 1.5%. Enter your county's rate as the local rate.
Local taxes are not added automatically because they depend on your address and where you work. Enter your rate in the Local income tax field (for example 2.02%) to include it.
Example: $60,000 salary in Indiana
A single filer earning $60,000 a year, paid every two weeks, with a standard 2026 W-4 and no 401(k) or health deductions:
| Every two weeks | Per paycheck | Per year |
|---|---|---|
| Gross pay | $2,307.69 | $60,000.00 |
| Federal income tax | -$193.08 | -$5,020.00 |
| Social Security (6.2%) | -$143.08 | -$3,720.00 |
| Medicare (1.45%) | -$33.46 | -$870.00 |
| Indiana income tax | -$66.94 | -$1,740.50 |
| Take-home pay | $1,871.13 | $48,649.50 |
Indiana income tax is about $1,740.50 a year here, 2.9% of gross pay. All taxes together take 18.9% of pay. Federal withholding is the 2026 single schedule: $60,000 less the $8,600 allowance gives $51,400, taxed at $1,240 plus 12% above $19,900, or $5,020 a year.
Take-home pay in Indiana at different salaries
Yearly take-home pay for a single filer in Indiana, paid every two weeks, with no pre-tax deductions or local tax. For a married couple filing jointly on $120,000, take-home pay is about $97,299 a year (18.9% in taxes).
| Salary | Indiana tax | Take-home per year | Per paycheck |
|---|---|---|---|
| $30,000 | $856 | $25,430 | $978.06 |
| $45,000 | $1,298 | $37,040 | $1,424.60 |
| $60,000 | $1,741 | $48,650 | $1,871.13 |
| $80,000 | $2,331 | $62,780 | $2,414.60 |
| $100,000 | $2,921 | $76,260 | $2,933.06 |
| $150,000 | $4,396 | $109,396 | $4,207.52 |
| $250,000 | $7,346 | $175,837 | $6,762.94 |
How the Indiana paycheck estimate works
Federal income tax follows IRS Publication 15-T for 2026: your paycheck is annualized, an allowance for the standard deduction is taken off, the 2026 withholding schedule for your filing status is applied, and W-4 credits and extra withholding are added back per paycheck. Social Security is 6.2% of wages up to $184,500 and Medicare 1.45%, plus 0.9% on wages over $200,000.
Indiana tax is estimated for the whole year: wages after pre-tax deductions, less exemptions, run through the brackets above, then divided by the number of paychecks.
Indiana tax = Brackets(Wages − pre-tax deductions − exemptions)