Indiana Tax Guide 2026

Indiana Income Tax Overview

Indiana has a Flat 3.05% rate (reduced in 2026). When combined with federal income tax and FICA taxes, Indiana residents in the median income range of $63,015 typically face a combined effective tax rate of approximately 29% on their gross income. The state income tax is calculated on taxable income after the federal standard deduction of $16,100 (single) or $32,200 (married filing jointly) for 2026.

Indiana Sales Tax Rate 2026

Indiana's combined sales tax rate is 7.00%, which includes a state rate plus an average local rate. On a $100 purchase, you pay $7.00 in sales tax — and $35.00 on a $500 purchase. Rates can vary within the state based on county and city jurisdiction.

Property Taxes in Indiana

Indiana homeowners pay an effective property tax rate of 0.74% annually. On the Indiana median home price of $240,000, that means approximately $1,776 per year — or $148 added to your monthly mortgage payment. Indiana's property tax rate is near the national average of 1.07%.

Total Tax Burden for Indiana Residents

When calculating the total tax burden for a Indiana household earning $63,015 annually, you must add: federal income tax (approximately $7,562), FICA taxes (7.65% = $4,821), Indiana state income tax (approximately $1,367), and property taxes if you own a home. Use the specific calculators above to get your exact personalized numbers based on your income, filing status, and situation.

Tax Tips for Indiana Residents in 2026

• Maximize your 401(k) to $24,500 — reduces both federal AND Indiana state income tax
• HSA contributions are deductible from both federal and state income tax in Indiana
• Check if Indiana has its own standard deduction (some states have lower amounts than federal)
• The 2026 OBBBA tip and overtime deductions apply at federal level — check Indiana conformity