Does Indiana have a state income tax?

Indiana taxes individual income with a flat state income tax of 2.95%.

What is the minimum wage in Indiana in 2026?

The 2026 minimum wage in Indiana is $7.25/hour, with a tipped minimum of $2.13. Rate drops to 2.9% in 2027.

What is the sales tax in Indiana?

The statewide sales tax rate is 7% (local city/county add-ons can raise the combined rate considerably).

Indiana Taxes 2026 — Income Tax, Sales Tax & Minimum Wage

2.95%Income tax

7%State sales tax

$7.252026 min wage

2026Tax year

🧾

Income Tax

Indiana uses a flat rate of 2.95% on all taxable income — the same rate whether you earn $30,000 or $300,000.

🛒

Sales Tax

The statewide sales tax is 7%. Cities and counties add local option taxes — combined rates commonly run 1.5–3 percentage points higher than the state rate.

💼

2026 Minimum Wage

$7.25/hour (tipped minimum 2.13). Rate drops to 2.9% in 2027

📅

Tax Filing Notes

File the Indiana state return in addition to your federal return. The flat rate applies to federal taxable income with state-specific adjustments.

Context

How Indiana compares

🗺️

All 50 States + D.C.

Compare income tax, sales tax, and minimum wage across every state.

🧾

Federal Tax Estimator

2026 IRS brackets and standard deduction.

🪪

Indiana 2026 — FAQ

What is the 2026 minimum wage in Indiana?

$7.25/hour, with a tipped minimum of $2.13. Rate drops to 2.9% in 2027

Is Indiana income tax high or low compared to other states?

Indiana's flat rate of 2.95% ranks among the lowest of states with an income tax.

Do local taxes add to these rates?

Yes. Cities and counties add local sales taxes (often +1.5–3 points), and some states add county income taxes (e.g., MD, IN). Check your local jurisdiction for the effective rate.

Sources: Tax Foundation — State Individual Income Tax Rates and Brackets 2026; U.S. DOL/WHD state minimum wage tables (Paylocity/Gusto 2026 editions); state revenue agencies. Retrieved Aug 11, 2026. Educational reference — verify current rates with the Indiana revenue department before relying on them.