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Tax Year 2026Updated July 20, 2026

Indiana Paycheck Calculator 2026

Indiana uses a flat income tax rate of 2.95% on all taxable income. Unlike states with graduated brackets, every dollar you earn above the exemption threshold is taxed at the same rate. Combined with federal income tax and FICA deductions, use the calculator below to see your actual take-home pay per pay period.

Indiana's Flat Income Tax

Indiana levies a flat 2.95% income tax on all taxable income. There are no progressive brackets - whether you earn $30,000 or $300,000, the state rate is the same. This simplifies withholding calculations compared to graduated-bracket states.

Before the flat rate is applied, Indiana subtracts a personal exemption of $1,000 (single) or $2,000 (MFJ), reducing your taxable income.

The state sales tax is 7.00% (7.00% combined average with local additions), a relatively low combined rate. Mandatory county income taxes add an additional layer of withholding. Retirees may benefit from partial pension income exclusions.

How Your Indiana Paycheck Is Calculated

  1. Gross pay: Your annual salary divided by the number of pay periods.
  2. Federal income tax: 2026 progressive brackets (10%-37%) after the federal standard deduction of $16,100 (single) or $32,200 (MFJ).
  3. Social Security: 6.2% on wages up to $184,500.
  4. Medicare: 1.45% on all wages, plus 0.9% above $200,000 (single).
  5. Indiana state income tax: Flat 2.95% on taxable income.
  6. County income tax: Additional county tax applies based on your county of residence (not modeled in this calculator).

County Income Taxes in Indiana

Every county in Indiana levies its own income tax on top of the 2.95% state rate. Your county tax is based on your county of residence as of January 1. This is a mandatory additional tax.

Note: County taxes are not modeled in this calculator. Your actual take-home pay will be lower by the applicable county rate.

Retirement Income in Indiana

Indiana offers a partial exclusion for pension and retirement income. Some retirement income may be exempt or receive preferential treatment depending on the source and amount. verified_primary_snippet - Social Security exempt. Military retirement fully exempt. Most other retirement income taxable. Small deduction for certain civil service annuities; confirm on direct access

Worked Examples

Example 1: $62,000/year - Single, Monthly

Profile: $62,000 annual salary, Single filer, paid monthly (12 paychecks/year)

Gross per period: $5,166.67
Federal income tax: -$438.33
Social Security: -$320.33
Medicare: -$74.92
Indiana state income tax: -$152.42
Net take-home pay: $4,180.67 per paycheck ($50,168/year)
Effective total tax rate: 19.08%

Example 2: $55,000/year - Married Filing Jointly, Semi-monthly

Profile: $55,000 annual salary, Married Filing Jointly filer, paid semimonthly (24 paychecks/year)

Gross per period: $2,291.67
Federal income tax: -$95.00
Social Security: -$142.08
Medicare: -$33.23
Indiana state income tax: -$67.60
Net take-home pay: $1,953.76 per paycheck ($46,890/year)
Effective total tax rate: 14.75%

Example 3: $110,000/year - Head of Household, Weekly

Profile: $110,000 annual salary, Head of Household filer, paid weekly (52 paychecks/year)

Gross per period: $2,115.38
Federal income tax: -$226.69
Social Security: -$131.15
Medicare: -$30.67
Indiana state income tax: -$62.40
Net take-home pay: $1,664.47 per paycheck ($86,552/year)
Effective total tax rate: 21.32%

Indiana Tax Notes

  • Flat tax rate: 2.95% on all taxable income.
  • Supplemental withholding rate: 2.95% for bonuses and supplemental wages.
  • County income taxes: Mandatory county taxes apply on top of the state rate (not modeled here).
  • Sales tax: 7.00% state rate, 7.00% combined average with local taxes.

All 92 Indiana counties levy their own income taxes, ranging from 0.5% to 3.38%. These are collected via state withholding based on county of residence. Check the Indiana DOR county tax rate table for your specific county rate.

OBBBA Conformity

Indiana partially conforms to the federal OBBBA deductions. The state provides its own, smaller exclusion for tips and overtime income that differs from the federal amounts. The federal deductions still apply on your federal return at the full amount.

Frequently Asked Questions

What taxes are deducted from my Indiana paycheck?
Your Indiana paycheck has deductions for federal income tax (10%-37% progressive brackets), FICA (Social Security + Medicare), and Indiana state income tax at a flat rate of 2.95%. Local/county taxes may also apply depending on where you live.
How accurate is this paycheck calculator?
This calculator estimates take-home pay using 2026 federal and Indiana state tax rates. It models federal income tax, FICA, and state income tax. It does not include pre-tax deductions (401(k), HSA, health insurance premiums), post-tax deductions, or state-specific payroll taxes (disability insurance, paid leave). Your actual paycheck may differ.
How does Indiana's flat income tax work?
Indiana uses a flat tax rate of 2.95% that applies to all taxable income regardless of how much you earn. Unlike graduated-bracket states where higher income is taxed at higher rates, every dollar of taxable income in Indiana is taxed at the same rate. A personal exemption reduces your taxable income before the flat rate is applied.
Is Indiana's flat tax rate applied to all my income?
The flat rate applies to your taxable income, which is your gross income minus any applicable deductions or exemptions. Indiana provides a personal exemption that reduces taxable income. The flat rate does not apply to income below these thresholds.
How do county income taxes work in Indiana?
Every county in Indiana levies its own income tax on top of the state's flat rate. Rates range from 0.5% to 3.38% depending on the county. Your county tax is based on where you live (your county of residence as of January 1). This is a mandatory additional tax that significantly affects take-home pay.
Is my pension or retirement income taxed in Indiana?
Indiana offers a partial exclusion for pension and retirement income. Some retirement income may be exempt or receive preferential treatment depending on the source and amount. Social Security benefits are not taxed at the state level.
How are bonuses and supplemental wages taxed in Indiana?
Indiana withholds state tax on bonuses, commissions, and other supplemental wages at a flat rate of 2.95%. This may differ from your regular withholding rate. At the federal level, supplemental wages are typically withheld at a flat 22% (or 37% above $1 million).
Does Indiana conform to the OBBBA overtime and tips deductions?
Partially. Indiana provides its own exclusion for tips and overtime income, but the amounts differ from the federal OBBBA deductions. The federal deductions still reduce your federal taxable income at the full amount. Check with your Indiana tax authority for the state-specific exclusion limits.