Seven Indiana Counties Increase Tax Rates as of October 1,2017

The Indiana Department of Revenue updated Departmental Notice #1 which assists withholding agents in determining the correct amount of Indiana county income tax to withhold from an employee’s wages by providing the tax rate for each county.

Seven counties, including Marion county, have increased their rate effective October 1, 2017. The changes are highlighted below. For a complete list of county tax rates, please visit http://www.in.gov/dor/3618.htm

County Name Previous Rate Rate Effective October 1, 2017
 Allen 1.35% 1.48%
 Clinton 2.00% 2.25%
 Fountain 1.55% 2.10%
 LaGrange 1.40% 1.65%
 Marion 1.77% 2.02%
 Sullivan 0.30% 0.60%
 Vermillion 0.20% 1.50%

 

County taxes should be withheld based on the employee’s Indiana county of residence as of January 1st of the tax year. If an employee lives out-of-state, but works in an Indiana county, then county taxes should be withheld based on the Indiana county of employment.

As a reminder, the state withholding rate remains at 3.23%, which was effective January 1, 2017.

If you would like additional information or to discuss the topics mentioned, please contact Kelley J. Wolfe, CPA at 317-260-4482 or kwolfe@greenwaltcpas.com