How to Compute Indiana County Income Tax Withholding

• 100 N. Senate Ave. Indianapolis, IN 46204 • dor.in.gov Departmental Notice #1

Effective Jan. 1, 2026 (R46 / 01-26)

Important Note: The rates in this notice are effective for withholding purposes for periods beginning on or after Jan. 1, 2026.

How to Compute Withholding for State and County Income Tax

This document does not meet the definition of a "statement" required to be published in the Indiana Register under IC 4-22-7-7. The purpose of this document is to assist withholding agents in determining the correct amount of Indiana county income tax to withhold from an employee's wages by providing the tax rate for each county. An asterisk (*) beside a county name indicates the rate has changed since Departmental Notice #1 was published on Oct. 1, 2025. Both the county of residence and the county of principal business or employment of an individual are determined on Jan. 1 of the calendar year in which the individual's taxable year begins. If an individual resides in an Indiana county on Jan. 1, the rate corresponds to that county of residence. If the resides out-of-state on Jan. 1 but has his or her principal place of work or business in an Indiana county as of Jan. 1, he or she is subject to county tax at the rate corresponding to that Indiana county. Withholding agents should withhold county tax based on the employee's Indiana county of residence as of Jan. 1 of the tax year. If the employee resides out-of-state on Jan. 1 but has his or her principal place of work or business in an Indiana county as of Jan. 1, then the withholding agent should withhold for the Indiana county of the principal place of work or business. Certain professional team members and race team members are subject to county tax. Please refer to Income Tax Information Bulletins #88 and #88B for further information. Withholding for these individuals shall be done in a manner otherwise consistent with this notice. For withholding occurring on or after Jan. 1, 2024, an employer is not required to withhold state or county income tax on some employees if the employee will work in Indiana for 30 days or less during the taxable year. Please refer to the "Special Rules for Nonresident Employees" section below. The deduction constant tables on the next page have been developed to help calculate state and county income tax. These tables divide the dollar amount of the exemption/dependent exemption by the number of pay periods. This will determine the deduction constant or the dollar amount of the exemption you should deduct each pay period from the employee's gross income. Note that these tables are provided for regular periodic payments for wages, salaries, and other compensation. For one-time or non-periodic payments, such as a bonus check, withholding

Indiana Department of Revenue Indiana Government Center

should be computed without exemptions. For purposes of withholding, Indiana does not follow the allowance for no withholding permitted for federal purposes under IRC § 3402(n). Table A is used to figure personal exemptions. Each employee is entitled to deduct $1,000 per year per exemption claimed on line 5 of his/her Form WH-4. Personal exemptions include additional exemptions if the employee and/or the employee's spouse are age 65 or older and/or blind. Please refer to Form WH-4. Table B is used to figure additional dependent exemptions. Most employees are entitled to deduct $1,500 per year per qualifying dependent exemption claimed on line 6 of his/her Form WH-4. Table B is also used to figure the supplemental first-time additional dependent exemption. Most employees are entitled to deduct $1,500 per year per qualifying first-time dependent exemption claimed on line 7 of his/her Form WH-4. Table C is used to figure your adopted child dependent exemptions. Most employees are entitled to deduct $3,000 per year per qualifying adopted child claimed on line 8 of his/her Form WH-4. For 2026, the state adjusted gross income tax rate for individuals is 2.95%.

Deduction Constant Tables

Table A Table B Table C Semi Monthly Semi Monthly Semi Monthly Bi Weekly Bi Weekly Bi Weekly 1,000.00 1,250.00 Monthly Monthly Monthly Weekly Weekly Weekly 166.67 115.38 125.00 250.00 153.85 166.67 333.33 192.31 208.33 416.67 115.38 230.77 250.00 500.00 125.00 115.38 125.00 250.00 173.08 187.50 375.00 115.38 230.77 250.00 500.00 144.23 288.46 312.50 625.00 115.38 125.00 250.00 115.38 230.77 250.00 500.00 173.08 346.15 375.00 750.00 230.77 461.54 500.00 288.46 576.92 625.00 - - - 19.23 38.46 41.67 83.33 38.46 76.92 83.33 57.69 10.96 76.92 13.70 96.15 16.44 28.85 57.69 62.50 57.69 12.33 86.54 16.44 20.55 57.69 16.44 24.66 32.88 41.10 Daily Daily Daily 2.74 5.48 8.22 4.11 8.22 8.22 - - -

Locate the deduction constant for the personal exemptions in Table A. Add to that the deduction constant for the additional dependent exemptions in Table B and Table C. This is the net amount that should be deducted each pay period from the employee's gross income.

Example: An employee is paid a weekly salary of $800; he/she claims five personal

exemptions and is subject to county tax at the rate of 0.01. He/she claims three additional dependent exemptions, one first-time additional dependent exemption, and two adopted child dependent exemptions. The taxable income of $473.08 is the amount on which state and county tax should be calculated.

Equation Math

Deduction Constant from Table A $96.15

Special Rules for Certain Nonresident Employees

If you have a time and attendance system where employees are required to record the employee's out-of-state work location on a contemporaneous basis and that system is used to allocate compensation between states, you are not required to withhold state and local taxes if the employee is reasonably expected to work in Indiana for 30 days or less during the calendar year. However, if the employee actually works in Indiana for more than 30 days during the calendar year, you will be required to withhold the tax that otherwise would have been withheld for the first 30 days and withhold on any compensation thereafter. Nevertheless, you are permitted to withhold taxes for the first 30 days, provided that the withholding follows the requirements in this notice. If you are not certain whether an employee will meet the 30-day threshold, you can withhold state and county income taxes and the employee can file a return requesting a refund of the taxes withheld if the employee did not meet the 30-day threshold. In addition, if the employee provides a properly completed Form WH-4AFF, the employer is relieved from withholding until the employee has worked in Indiana for more than 30 days during the calendar year. Please note that if an employee worked previously in Indiana for another employer, any days worked for the previous employer(s) count toward the 30 days.

Total Deduction Constant $326.92 Taxable Income $473.08

Deduction Constant from Table B (additional dependent) Deduction Constant from Table B (first-time additional dependent) Deduction Constant from Table C (adopted dependent) Gross Income Total Deduction Constant State Tax to Withhold County Tax to Withhold $473.08 x .0295 = $13.96 $473.08 x .01 = $4.73 +115.38 $800.00 -326.92 +86.54 +28.85

If you have not withheld taxes from an employee based on the good-faith assumption that the employee would not work in Indiana for more than 30 days but the employee in fact works in Indiana for more than 30 days, you are permitted to increase withholding on that employee in any manner reasonably intended to make up for the tax not previously withheld. If you are increasing withholding due, report the tax withhold for the month in which the withholding actually occurred rather than amending previous months' withholding returns. This allowance is not permitted for employees who are professional athletes, professional sports team members, race team members, professional entertainers, and public figures. In addition, this allowance is not permitted for employees who were, or will become, Indiana residents for any part of the calendar year.

Note: Income Tax Information Bulletins which may be of assistance with withholding tax questions are numbers 16, 28, 32, 33, and 52. If you have any questions about the withholding of state or county taxes, please contact the department at 317-232-2240.

Christopher W. Russell

General Counsel

Indiana Department of Revenue

Indiana County Tax Rates: Effective Jan. 1, 2026

A county with an asterisk (*) has changed its rate since Departmental Notice #1 was issued on Oct. 1, 2025.

County Name County Code County Tax Rate Adams 0.016 Allen 0.0159 Bartholomew 0.0175 Benton 0.0179 Blackford 0.025 Boone 0.017 Brown 0.025234 Carroll 0.024733* Cass 0.0295 Clark 0.02 Clay 0.0235 Clinton 0.0265 Crawford 0.0165 Daviess 0.015 Dearborn 0.014 Decatur 0.0245 DeKalb 0.0213 Delaware 0.015 Dubois 0.012 Elkhart 0.02 Fayette 0.0282 Floyd 0.0189 Fountain 0.021 Franklin 0.017 Fulton 0.0288 Gibson 0.013 Grant 0.0275* Greene 0.0235* Hamilton 0.011 Hancock 0.0194 Harrison 0.01 Hendricks 0.017 Henry 0.0202 Howard 0.0235* Huntington 0.0195 Jackson 0.021 Jasper 0.02864 Jay 0.025 Jefferson 0.0103 Jennings 0.025 Johnson 0.014 Knox 0.017 Kosciusko 0.01 LaGrange 0.0165 Lake 0.015 LaPorte 0.0145 County Name County Code County Tax Rate Lawrence 0.0175 Madison 0.0225 Marion 0.0202 Marshall 0.0125 Martin 0.025 Miami 0.0254 Monroe 0.0214 Montgomery 0.0265 Morgan 0.0272 Newton 0.01 Noble 0.0175 Ohio 0.02 Orange 0.0175 Owen 0.025 Parke 0.0265 Perry 0.014 Pike 0.012 Porter 0.005 Posey 0.0145 Pulaski 0.0285 Putnam 0.023 Randolph 0.03 Ripley 0.0238 Rush 0.0215 St. Joseph 0.0175 Scott 0.0216 Shelby 0.017* Spencer 0.008 Starke 0.0171 Steuben 0.0199 Sullivan 0.017 Switzerland 0.0145 Tippecanoe 0.0128 Tipton 0.026 Union 0.0275* Vanderburgh 0.0125 Vermillion 0.015 Vigo 0.02 Wabash 0.029 Warren 0.0212 Warrick 0.01 Washington 0.02 Wayne 0.0125 Wells 0.021 White 0.0232 Whitley 0.016829