Six Indiana Counties Have Tax Rate Increases Effective January 1

Effective January 1, 2025, the Indiana Department of Revenue (DOR) revised Departmental Notice No. 1, How to Compute Withholding for State and County Income Tax. Six counties have tax rate changes:

• Floyd—0.0189, increasing from 0.0139
• Gibson—0.013, increasing from 0.009
• Jay—0.025, increasing from 0.0245
• Monroe—0.0214, increasing from 0.02035
• Rush—0.0215, increasing from 0.021
• Switzerland—0.0145, increasing from 0.0125

All 92 of Indiana’s counties impose a county income tax on residents of the county and on nonresidents—who do not reside in another Indiana county—with a principal place of business or employment in the county. Each county has one county income tax rate (i.e., tax rates are the same for residents and nonresidents). Employers withhold state and county income taxes from employees’ wages.

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Lia Coniglio, Esq., is Managing Editor of PayState Update and Senior Manager of State Payroll Information Resources for PayrollOrg.