Indiana State Income Tax
The Indiana Income Tax
Indiana collects a state income tax at a maximum marginal tax rate of %, spread across tax brackets. Unlike the Federal Income Tax. Indiana’s state income tax does not provide couples filing jointly with expanded income tax brackets.
Indiana’s maximum marginal income tax rate is the 1st highest in the United States, ranking directly below Indiana’s %. You can learn more about how the Indiana income tax compares to other states’ income taxes by visiting our map of income taxes by state .
In Indiana, all counties except Lake County collect a local income tax in addition to the state and federal income taxes you already pay. The average income tax rate for counties and large municipalities is 1.16% (according to the Tax Foundation, weighted by income). The Indiana personal exemption includes a $1,500 additional exemption for dependent children (the exemption for non-minor dependents is $1,000).
You are responsible for paying the local income tax to the county in which you work in addition to your federal and Indiana income tax returns – keep in mind that different income tax rates may apply to residents and nonresidents of the county. You can access a list of all Indiana counties and their income tax rates here.
Using the Indiana ePay system, you can now make all of your tax payments (including estimated tax payments if required), online. With Department of Revenue approval, you can also set up a tax payment plan or file a payment under a deadline extension through the ePay system. If you have questions about paying your Indiana income tax, contact the Department of Revenue’s hotline at (317) 232-2240.
There are -513 days left until Tax Day, on April 15th 2015. The IRS will start accepting eFiled tax returns in January 2015 – you can start your online tax return today for free with TurboTax .
Indiana Tax Deductions
Income tax deductions are expenses that can be deducted from your gross pre-tax income. Using deductions is an excellent way to reduce your Indiana income tax and maximize your refund, so be sure to research deductions that you mey be able to claim on your Federal and Indiana tax returns. For details on specific deductions available in Indiana, see the list of Indiana income tax deductions.
4.1 – Indiana Standard Deduction
Unlike many other states, Indiana has no standard deduction. Certain itemized deductions (including property tax. qualified charitable contributions, etc) may be allowed depending on the income level and filing type of the taxpayer. Keep in mind that not all deductions allowed on your federal income tax return are necessarily going to be allowed on your Indiana income tax return.
4.2 – Indiana Personal Exemptions
Indiana has no personal exemption. The Federal Income Tax, however, does allow a personal exemption to be deducted from your gross income if you are responsible for supporting yourself financially.
4.3 – Indiana Dependent Deduction
Unlike most states, Indiana does not have a dependent deduction. You can, however, claim dependent deductions on your Federal Tax Return.
4.4 – Indiana Itemized Deductions
Unlike the Federal income tax, the Indiana income tax does not allow itemized deductions. You may claim the Indiana standard deduction if applicable, and specific deductions may be available to Indiana taxpayers as limited deductions or tax credits.
Tax-Rates.org provides easy access to five of the most commonly used Indiana income tax forms, in downloadable PDF format. For all of the tax forms we provide, visit our Indiana tax forms library or the ‘s tax forms page.
If you are an Indiana resident, use the County tax Schedule to determine your local and county income tax.
All Indiana residents who earned income in the last year must file Form IT-40 with the Indiana Department of Revenue. If you have a simple tax return, you can file form IT-40 EZ instead.
If you have a simple state tax return, you can file an IT-40 EZ form instead of the regular Form IT-40.