Estimate your take-home pay in Indiana for 2026. The state levies income tax with a top rate of 3.05% (Flat rate of 3.05% (plus county taxes)). This means a portion of every paycheck goes toward state income tax in addition to federal withholding, Social Security, and Medicare.
Indiana Tax Snapshot
- State Income Tax
- 3.05% top rate
- Sales Tax (state + local avg)
- 7.00%
- Avg Property Tax Rate
- 0.83%
- Median Home Value
- $197,200
- State Minimum Wage
- $7.25/hr
Did You Know?
Indiana has a flat state income tax plus county-level income taxes.
How Indiana Taxes Affect Your Paycheck
When you earn a paycheck in Indiana, your employer withholds federal income tax, Social Security (6.2%), and Medicare (1.45%). On top of that, the state withholds income tax based on flat rate of 3.05% (plus county taxes). The state minimum wage is $7.25 per hour, which sets the floor for hourly workers. Understanding these deductions helps you budget effectively and plan for the average 0.83% property tax rate on homes valued around $197,200.
Indiana also levies a combined state and average local sales tax of 7.00%, which affects your overall purchasing power. Factor this into your budget when calculating how far your paycheck stretches.