Indiana County Income Tax Rates for 2026: All 92 Counties
Indiana County Income Tax Rates for 2026: All 92 Counties
If you live or work in Indiana, you pay a county income tax on top of the state income tax. Each of Indiana's 92 counties sets its own local rate, so two people with the same salary can owe different amounts depending on where they live and where they work. This guide covers how Indiana county income tax works for 2026, the verified rates for selected counties, the six counties whose rates rose on January 1, 2026, and how to find the rate for any county.
The complete 92-county table is published in the Indiana Department of Revenue's withholding notice. The figures in this guide are the ones verified from that notice for the counties readers ask about most. For any county not listed here, use the steps in the section below to pull its rate directly from the notice.
Informational content, not legal or tax advice. This guide summarizes Indiana Department of Revenue publications and related law as of 2026. It is not legal or tax advice. Rates change, and your situation may involve rules this guide does not cover. Confirm figures with the Indiana Department of Revenue, and talk to a qualified CPA or tax attorney about complex situations, such as a mid-year move, income from more than one state, or business income.
How Indiana County Income Tax Works
Indiana's individual income tax has two layers. The state rate is a flat 2.95% for 2026, and the state rate is scheduled to fall to 2.90% in 2027. On top of that, each county levies a local income tax at a rate it sets, so the county you are tied to determines the second layer.
The two layers stack. Your county rate is added to the state rate, which means your combined rate depends on your county. In Marion County, the 2026 rate is 2.02%, so the combined rate is 4.97% (2.95% plus 2.02%). In Porter County, the rate is 0.50%, so the combined rate is 3.45%. These combined figures apply to your Indiana taxable income.
Most workers see the county tax as a payroll deduction. Employers withhold it from each paycheck using the county rates the Department of Revenue publishes for withholding, so the county information you give your employer matters.
2026 County Income Tax Rates for Selected Counties
The rates below come from Indiana Department of Revenue Departmental Notice 1, effective January 1, 2026 (R46 / 01-26). The notice is the document the Department publishes for withholding. Porter County has the lowest rate in the notice, and Randolph County has the highest.
| County | 2026 local income tax rate | Note |
|---|---|---|
| Porter | 0.50% | Lowest rate in the notice |
| Hamilton | 1.10% | |
| Lake | 1.50% | |
| Allen | 1.59% | |
| Floyd | 1.89% | |
| Clark | 2.00% | |
| Vigo | 2.00% | |
| Marion | 2.02% | |
| Randolph | 3.00% | Highest rate in the notice |
Use these figures as published in the notice. If you need a county that is not in this table, the notice lists it, and the section below explains how to find it.
Counties Whose Rates Rose on January 1, 2026
The notice marks six counties with an asterisk because their rates increased on January 1, 2026. The new rates are:
- Carroll County: 2.4733%
- Grant County: 2.75%
- Greene County: 2.35%
- Howard County: 2.35%
- Shelby County: 1.70%
- Union County: 2.75%
If you live in one of these counties, confirm that your payroll withholding uses the 2026 rate, and compare it against your 2025 return. A higher county rate means more county tax on the same income, so a 2026 rate increase affects your take-home pay and your year-end bill.
Residence County vs. Work County
Indiana uses two different rules to pick the county rate. Which rule applies depends on where you live on January 1 and where you work.
- An Indiana resident is taxed at the rate of their county of residence.
- A person who lived out of state on January 1 but works in an Indiana county is taxed at the rate of that work county.
Both the county of residence and the county of principal work are fixed on January 1 of the tax year. Here is how that plays out:
- An Indiana resident who lives in Hamilton County and commutes to Marion County pays Hamilton County's 1.10% rate, not Marion County's 2.02% rate.
- A resident of another state who works in Clark County pays Clark County's 2.00% rate.
Because both determinations are made on January 1, a mid-year move or job change does not automatically change the county rate that applies for that year. Confirm with the Department of Revenue or a CPA how a mid-year move or job change is handled on your return.
Local Income Tax Law Changes Ahead
Indiana is rewriting how local income taxes work, but the rewrite has been delayed. Senate Enrolled Act 1 (2025) sets out a new local income tax structure. House Enrolled Act 1210 (2026), signed March 12, 2026, delays that overhaul by one year. A Department of Local Government Finance (DLGF) memo dated July 17, 2026, describes the timing as follows:
- Current local income tax ordinances now expire on January 1, 2029.
- Counties may adopt new ordinances starting July 1, 2028, for collections that begin in 2029.
Current ordinances remain in effect until they expire. If you plan around the county rate for the next few years, check the current rate for your county each year rather than assuming a fixed figure. Confirm the timing and any county-level changes with the DLGF and the Department of Revenue.
When County Rates Change
County rates can change on January 1 and on October 1. The notice you use for withholding is reissued when rates change, so check the effective date printed on any notice before you rely on it.
An October 1, 2026 reissue has been reported with a change affecting Boone County only. That change has not been confirmed against the notice PDF, so do not treat it as settled. Check the current Departmental Notice 1 on the Department of Revenue website before you set withholding or file your return.
How to Find the Rate for Any Indiana County
Use this process to find the rate for your county, or for any county you need to check:
- Go to the Indiana Department of Revenue website at https://www.in.gov/dor/ and search for Departmental Notice 1 for the current effective date.
- Find your county in the table of county rates. If you are an Indiana resident, use the county where you live. If you live out of state and work in Indiana, use the county where you work.
- Confirm that the notice's effective date matches the tax year you are filing.
- To estimate your combined 2026 rate, add the county rate to the state rate of 2.95%.
A city name does not tell you the county. Some Indiana cities span more than one county, so confirm your county from your address rather than from the name of your city.
Common Mistakes to Avoid
- Using the work county as an Indiana resident. Residents are taxed at their county of residence, even if they work in another county.
- Using a 2025 rate in a county that rose on January 1, 2026. Carroll, Grant, Greene, Howard, Shelby, and Union counties all have new rates for 2026.
- Relying on a rate from a third-party website. Compare any rate you find against the Department of Revenue notice before you use it.
- Assuming the rate will stay the same from year to year. Rates can change on January 1 and October 1, and the local income tax structure is changing after 2028.
Business Owners and County Income Tax
If you own a business, the county tax question depends on how the business is taxed. An LLC's income passes through to its owners, who pay the individual adjusted gross income tax (2.95% for 2026) plus their county local income tax. An LLC that has elected corporate treatment instead pays the corporate adjusted gross income tax of 4.9%.
For a pass-through LLC, the county that applies to each owner is the owner's county, so owners who live in different counties may pay different local rates on their shares of the same business income. Because this involves entity elections, owner residence, and payroll, talk to a CPA before you choose a structure or set up owner withholding.
When to Get Professional Help
Most individuals with a single Indiana job and a single county of residence can work from the notice and their pay stubs. Get help from a qualified CPA or tax attorney if any of these apply to you:
- You moved between counties or states during the year.
- You work in one state and live in another.
- You have self-employment income, or income from an LLC or other business.
- You have a county rate question that the notice does not answer.
Resources
- Indiana Department of Revenue: state and county income tax rates, Departmental Notice 1, and withholding information.
County income tax rules change, and this guide reflects the figures and law described above as of 2026. It is informational content, not legal or tax advice. Check the current notice with the Indiana Department of Revenue before you rely on any rate, and consult a qualified professional for your specific situation.