Indiana

SALES TAX

  • Statewide: 7.0%
  • Counties cannot levy an additional sales tax.
  • Common Exceptions at State Level:
    • Prescription Medicine: Exempt
    • Unprepared Foods: Exempt
    • Prepared Foods: 9%
  • Gasoline Tax: 71.10 cents/gallon (Includes all state, local, and federal taxes)
  • Diesel Fuel Tax: 82.40 cents/gallon (Includes all state, local, and federal taxes)

 

Personal Income Tax

  • Personal Income Tax Rate Range: 3.05%  
  • Standard deduction: None
  • Personal Exemption Allowance: $1,000. Dependent Exemption: $1,000 (may be able to take an additional $1,500 for certain dependents. Age 65 and over or blind: $1,000)
  • Itemized Deductions Allowed?: Generally not allowed
  • State allows county- and city-level income tax. 
  • Retirement Income
    • Social Security: Exempt
    • IRAs: Taxable at ordinary income tax rates
    • 401Ks/Defined contribution employer retirement plans: Taxable at ordinary income tax rates
    • Private pensions: Taxable at ordinary income tax rates
    • Public Pensions: Taxable at ordinary income tax rates except federal pensions for taxpayers 62 and older who may deduct $16,000 from Adjusted Gross Income less Social Security
  • Military Pay
    • Active Duty Pay: All military pay exempt (Source).
    • Military Retirement Pay: Exempt.
    • Military Disability Pay: Exempt
    • VA Disability Dependency & Indemnity Compensation Benefits: Exempt
    • SBP/SSBP/RCSBP/RSFPP: Exempt
Income tax comment: Additional $1,500 exemption possible if AGI under $40,000.

 

Property Tax

  • Local municipalities average .83% of the property's assessed value.
  • Calculation of assessed value: 100% of fair market value.
  • Relief programs for:
    • Owner-Occupied: Can exempt the lesser of 60% of assessed value or $48,000; supplemental deduction of 35% to 40% available.
    • 65 and Over: Can exempt the lesser of half of assessed value or $14,000 if income less than $32,610 ($43,480 for married filing jointly) and assessed value is under $240,000.
    • 65 and Over Freeze: Assessed value cannot increase more than 2% if income less than $32,610 ($43,480 for married filing jointly) and assessed value is under $200,000.
    • Disabled Veterans/Surviving Spouses: Can exempt up to $24,960 of assessed value if has service-connected disability of at least 10% and served in war (World War I surviving spouse: $18,720).
    • Totally Disabled Veteran or Veteran 62 or Over With Service-Connected Disability of 10% or More: Up to $14,000 can be exempt.
    • Blind/Disabled: Can exempt $12,480 of assessed value if income less than $17,000.
  • Personal Property Tax: Yes. Rates and exemptions vary.

 

Inheritance & Estate Taxes: None

 

Department of Revenue website: www.in.gov/dor

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