3% flat state tax + county income tax 0.5%–2.864%

Indiana Paycheck Calculator 2026

Indiana has a flat 3% state income tax (down from 3.05% in 2024). All 92 counties levy an additional county income tax, ranging from 0.5% to 2.864%. The combined rate varies by county where you live.

State income tax

3.00% (flat, down from 3.05% in 2024)

Max local tax

3.00% (Pulaski County)

FICA (employee)

7.65%

Standard deduction

$14,600

Annual gross salary

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County local tax

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Total taxes

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Effective rate

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As a 1099 freelancer, you owe 15.3% self-employment tax (both halves of FICA) on top of all income taxes.

Quarterly estimated payments due: Apr 15 · Jun 16 · Sep 15 · Jan 15

Indiana tax breakdown — what you need to know

Key facts about Indiana state, local, and federal taxes for 2026.

Flat state rate (2026)

Indiana reduced its flat income tax rate to 3.00% in 2026, down from 3.05% in 2024. It will continue falling: 2.95% in 2026, 2.90% in 2027 and beyond, with possible reductions to 2.55% if revenue targets are met.

All 92 counties tax income

Every single county in Indiana levies a county adjusted gross income tax (CAGIT) or county option income tax (COIT). Rates range from 0.5% (Porter County) to 3% (Pulaski County). You pay based on the county where you live on Jan 1.

How county tax is withheld

Your employer withholds Indiana county tax based on your county of residence as of January 1 of the tax year. If you move mid-year, you may need to adjust withholding or make estimated payments for the new county.

Reciprocity

Indiana has reciprocity agreements with Kentucky, Michigan, Ohio, Pennsylvania, and Wisconsin. If you live in Indiana and work across the border in one of those states, your employer should withhold Indiana tax instead.

Selected Indiana county tax rates

Source: state revenue departments and municipal ordinances. Rates effective 2026.

County	County rate	Notes
Jasper County	2.864%	Highest in state
Pulaski County	3.00%
Wabash County	2.90%
Cass County	2.70%
Marion (Indianapolis)	2.02%	Largest county
Allen (Fort Wayne)	1.48%	2nd largest
Hamilton County	1.10%	Affluent suburb
Lake County	1.50%	NW Indiana
Monroe (Bloomington)	1.45%	College town
Porter County	0.50%	Lowest rate
Dearborn County	1.00%
Gibson County	0.90%

Frequently asked questions — Indiana taxes

The county rate is based on your county of residence on January 1 of the tax year, not where you work. If you moved in January, your new county rate applies. Use your county on your Indiana IT-40 state return.

Indianapolis is in Marion County, which charges 2.02%. Indiana does not have separate city income taxes — the county tax covers the whole county, including the city of Indianapolis.

It varies by county. For Marion County (Indianapolis): 3% state + 2.02% county = 5.02% combined. For Hamilton County (Carmel/Fishers): 3% + 1.10% = 4.10%. For Jasper County: 3% + 2.864% = 5.864% combined.