Indiana Take-Home Pay Calculator
Estimate your Indiana paycheck using IN's flat 3% state income tax rate and personal exemption, plus federal income tax and FICA.
What comes out of an Indiana paycheck
Indiana taxes all income at a flat 3% for 2025, part of a legislated phase-down: 3.23% in 2022, stepping down to 3.15%, 3.05%, and 3% by 2025, with 2.95% set for 2026 and a target of 2.9% by 2027. Instead of a standard deduction, Indiana uses a $1,000 personal exemption per taxpayer and spouse (plus $2,500 per dependent) to reduce taxable income before the flat rate applies.
IN-taxable income: $80,000 − $4,000 pre-tax − $1,000 personal exemption = $75,000. IN tax: $75,000 × 3% = $2,250.
Federal tax (on $61,000 taxable) ≈ $8,334 · IN state tax ≈ $2,250 · Social Security $4,960 · Medicare $1,160.
Annual take-home ≈ $59,296 → about $2,281 per biweekly paycheck (74.1% of gross) — before any county income tax.
Indiana's county income taxes — the part the state rate doesn't show
Every one of Indiana's 92 counties levies its own income tax on top of the 3% state rate, with rates ranging from roughly 0.5% to 2.864% depending on where you live. Unlike states where local tax is optional or city-specific, Indiana's county tax applies to essentially every resident — it's just a question of which county's rate applies to you. Because these rates vary so widely, this calculator intentionally shows state tax only; check your county's specific rate (often listed on your pay stub) for your full picture.
Common mistakes when estimating Indiana take-home pay
- Forgetting county tax entirely. Every Indiana resident owes a county tax on top of the state rate — this isn't optional or city-specific like some other states' local taxes.
- Confusing the personal exemption with a standard deduction. Indiana's exemption is a smaller, fixed per-person amount rather than a large deduction like the federal standard deduction.
- Using an outdated rate. Indiana's flat rate has dropped nearly every year recently — confirm you're using 3% for 2025, not an earlier year's rate.
Frequently asked questions
What is Indiana's state income tax rate?
A flat 3% for 2025, dropping to 2.95% for 2026 as part of a phase-down targeting 2.9% by 2027.
Does Indiana have local county income tax?
Yes — every Indiana county levies its own tax, roughly 0.5% to 2.864%, on top of the state rate.
What is Indiana's personal exemption?
$1,000 per taxpayer and spouse, plus $2,500 per dependent, reducing taxable income before the 3% rate applies.
Will Indiana's rate keep falling after 2026?
Yes — the phase-down is scheduled to continue to a 2.9% target by 2027.
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Note: Simplified estimate using 2025 state and federal figures; excludes county income tax, credits, and benefit specifics. Not tax advice. Figures: 2025 Indiana and federal tax year (rate scheduled to drop to 2.95% for 2026). Last reviewed: September 2026.