Indiana Paycheck Calculator

How to Use This Indiana Paycheck Calculator

This Indiana paycheck calculator estimates your 2026 net take-home pay after federal income tax, Indiana flat state income tax, Indiana county income tax (CAGIT), Social Security, and Medicare. The state is locked to Indiana; use the generic paycheck calculator for other states.

Enter your gross salary or hourly wage, pay frequency, filing status, and any pre-tax deductions. Then select your Indiana county from the Locality dropdown — this is critical because county tax rates range from 0.5% to 2.02% and the county is withheld separately from state tax. Results update instantly.

How Indiana State Income Tax Works in 2026

Indiana uses a flat 2.95% state income tax on all Indiana taxable income. Indiana taxable income starts with federal adjusted gross income (AGI) — which includes your wages minus pre-tax 401(k), health insurance, and other deductions — and then subtracts the Indiana personal exemption of $1,000 per filer. There is no Indiana standard deduction.

Indiana also allows a dependent credit of $40 per dependentdirectly against the tax owed (not income). A family with two dependents reduces their Indiana tax bill by $80 per year. Indiana's flat rate dropped from 3.15% (2024) to 3.05% (2025– 2026) as part of a legislated phase-down — Indiana is continuing to reduce its state income tax over the coming years.

Indiana County Adjusted Gross Income Tax (CAGIT)

Every Indiana county levies a County Adjusted Gross Income Tax (CAGIT) on top of the state flat rate. Unlike many states where local taxes follow the city where you work, Indiana CAGIT is based on your county of residence as of January 1 of the tax year. This means:

• If you live in Hamilton County and work in Marion County (Indianapolis), you owe Hamilton County CAGIT (1.1%) — not Marion County (2.02%) — because it follows where you live, not where you work.
• If you move from Marion County to Hamilton County during the year, your withholding county only changes the following January 1 — your employer uses the January 1 residence county all year.

Key Indiana county tax rates (2026)

• Marion County (Indianapolis): 2.02% — highest of the major counties
• St. Joseph County (South Bend), Madison County (Anderson), Bartholomew County (Columbus): 1.75%
• Allen County (Fort Wayne): 1.48%
• Monroe County (Bloomington): 1.345%
• Tippecanoe County (Lafayette): 1.28%
• Johnson County, Vanderburgh County (Evansville): 1.2%
• Hamilton County: 1.1%
• Porter County: 0.5% — lowest of the major counties

The CAGIT applies to Indiana AGI — the same base as the state tax, calculated after pre-tax 401(k) and Section 125 deductions but before the personal exemption.

See the full annual tax picture using the Indiana income tax calculator.

FICA Taxes — Social Security and Medicare

FICA is federal and applies to every Indiana paycheck.

• Social Security: 6.2% on wages up to $176,100 (2025) or $184,500 (2026). No further withholding once you cross the wage base for the year.
• Medicare: 1.45% on all wages with no cap. Additional 0.9% Medicare surtax on wages above $200,000 single / $250,000 MFJ.
• Employer match: your employer matches Social Security and base Medicare; the Additional Medicare surtax is employee-only.

Step-by-Step Example — $70,000 Marion County Single Filer (2026)

1. Gross annual pay: $70,000
2. Federal taxable income: $70,000 − $16,100 standard deduction = $53,900. Federal income tax: ~$7,565.
3. Indiana taxable income: $70,000 − $1,000 exemption = $69,000. Indiana state tax: 2.95% × $69,000 = $2,105.
4. Marion County CAGIT: 2.02% × $70,000 (Indiana AGI) = $1,414.
5. FICA: 7.65% × $70,000 = $5,355.
6. Net take-home: $70,000 − $7,565 − $2,105 − $1,414 − $5,355 = ~$53,561/year (~$2,060 biweekly).

The same earner living in Hamilton County instead of Marion County would save ~$638/year in county tax alone (1.1% vs 2.02% on $70,000).

How to Maximize Your Indiana Take-Home Pay

• Max your 401(k) — the 2026 limit is $23,500 ($31,000 age 50+). Pre-tax contributions reduce both Indiana state tax and county CAGIT. A $15,000 contribution for a Marion County resident saves roughly $458 in Indiana state+county tax (at 3.05% + 2.02% = 5.07%) plus federal savings.
• Enroll in an HSA — $4,300 individual / $8,550 family in 2026. Reduces Indiana AGI and avoids FICA when contributed through payroll.
• Verify your county on file with HR — your employer withholds county tax based on the address on your Indiana WH-4 form. If you move counties, update your WH-4 effective January 1 of the new year so the correct county rate is applied.
• File for Indiana deductions on IT-40— Indiana's individual income tax return (IT-40) allows additional deductions such as the Indiana homeowner deduction, Indiana 529 CollegeChoice contributions, and military deductions that the paycheck withholding doesn't automatically capture.
• Use a Dependent Care FSA — up to $5,000 per household reduces both federal and Indiana taxable income.

State-Specific Payroll Deductions in Indiana

Beyond state and county income tax withholding, Indiana has no additional state-mandated payroll deductions. Specifically:

• No State Disability Insurance (SDI): Indiana does not operate a state disability insurance or temporary disability program. There is no SDI line on an Indiana paycheck. Employees are covered only through employer-provided disability plans or federal Social Security disability.
• No Paid Family and Medical Leave (PFML) program: Indiana has not enacted a state-level paid family or medical leave program. Indiana employees rely on federal FMLA (unpaid, 12 weeks) and any voluntary employer-provided leave benefits.
• County income tax withholding (CAGIT): Indiana is unique in that county income tax is a mandatory payroll withholding — this is the one significant Indiana-specific paycheck deduction beyond the state flat rate. Rates range from 0.5% (Porter County) to 2.02% (Marion County / Indianapolis), based on your county of residence as of January 1. See the County CAGIT section above for full rate details.

The two Indiana-specific lines on every Indiana paycheck are IN State Income Tax (2.95% flat) and County Tax (CAGIT) at your residential county rate. Both appear as separate withholding lines on Indiana paystubs.

How to Fill Out the Indiana Withholding Certificate (Form WH-4)

Indiana Form WH-4(Employee's Withholding Exemption and County Status Certificate) controls both Indiana state income tax withholding and county CAGIT withholding. Submit it to your employer when starting a new job or when your situation changes. Key fields:

• County of Residence (Box 1): Enter your county of residence as of January 1 of the current year. This is the most critical field on the WH-4 because Indiana county tax follows where you live — not where you work. If you live in Hamilton County (1.1%) and work in Marion County (2.02%), your employer withholds Hamilton County CAGIT (the lower rate) from your paycheck.
• County of Employment (Box 2): Enter the county where you work. If you are a non-Indiana resident who works in Indiana, your employer uses your employment county rate for CAGIT withholding (Indiana taxes non-residents on Indiana-sourced income).
• Exemptions (Box 3): Enter the number of exemptions you are claiming. Each exemption reduces withholding. The basic approach: claim 1 for yourself (single) or 2 for yourself and spouse (married). Add exemptions for dependents.
• Additional Withholding Amount (Box 4): You may request a specific additional dollar amount withheld per pay period — useful if you have self-employment income, rental income, or investment income without Indiana withholding.

Update your WH-4 whenever you move to a new Indiana county (effective January 1 of the following year), change your marital status, or add dependents. If you move mid-year, your employer continues using the January 1 county rate until you update the form for the next year. The Indiana Department of Revenue updates county CAGIT rates annually — confirm current rates when your county publishes its annual rate schedule.

Tax Disclaimer

This calculator provides estimates for informational purposes only. It is not tax advice. Indiana state rate, county CAGIT rates, and federal rules change annually. County rates are updated by the Indiana DOR each year. Consult a qualified Indiana-licensed CPA or tax professional for your specific situation.