Pay statement requirements
Employers subject to the Indiana Minimum Wage Law must furnish a statement of the employee’s hours worked, wages paid, and deductions made.
See details →INDIANA PAYROLL RESOURCES · IN · REVIEWED 2026-10-03
Indiana Payroll &
Pay Statement Guide
Review Indiana pay-statement requirements, state and county withholding, unemployment-tax guidance, and workers’ compensation resources. Run payroll for a small team and get employee statements from every calculated run.
Hours, wages, and deductionsCovered Indiana employers must furnish a statement showing hours worked, wages paid, and deductions.
State + county withholdingIndiana payroll can require both state adjusted-gross-income tax and county income-tax withholding.
Reviewed 2026-10-03Checked against current Indiana government sources.
AT A GLANCE
What distinguishes Indiana pay-period records
Indiana requires employers subject to the Indiana Minimum Wage Law to furnish each employee with a statement showing hours worked, wages paid, and deductions. The tax side is distinctive because payroll can include both the statewide individual adjusted-gross-income tax and county income-tax withholding, with county rates published through Departmental Notice #1 and subject to updates during the year.
State and county withholding
Indiana’s 2026 individual adjusted-gross-income tax rate is 2.95%. County income-tax rates can also apply and may change in January or October, so use the current Departmental Notice #1 for the pay period.
View current tax rates →Unemployment insurance
Indiana taxes the first $9,500 of wages per employee for unemployment purposes. The typical new-employer rate is 2.50%; the 2026 minimum rate is 0.50%, the maximum good-standing rate is 7.40%, and delinquent employers can reach 9.40%.
View rate computation →Workers’ compensation
Indiana states that most businesses must have workers’ compensation insurance and that covered employees are protected from the first day on the job. Statutory exclusions and ownership rules can affect coverage.
View official guidance →STATE PAYROLL OVERVIEW
What makes Indiana different from other pay-statement jurisdictions
Indiana’s pay-statement rule is concise but useful: employers subject to the Indiana Minimum Wage Law must furnish each employee a statement showing hours worked, wages paid, and deductions. The statement therefore supports the core gross-to-net record without prescribing the longer field list used in some other jurisdictions.
The more distinctive Indiana payroll issue is withholding. Indiana uses both a state individual adjusted-gross-income tax and county income taxes. The statewide rate is 2.95% for 2026, while county rates can be adjusted in January and October. Employers should use the Department of Revenue’s current Departmental Notice #1 and the employee’s county-status information rather than hardcoding a county rate into a reusable payroll template.
Indiana unemployment insurance is also relatively easy to frame for small employers: the taxable wage base is $9,500 per employee, the typical new-employer rate is 2.50%, and experienced-employer rates vary according to the state’s computation rules. Workers’ compensation remains a separate insurance obligation for most businesses.
PAYROLL REQUIREMENTS CHECKLIST
The Indiana requirements checklist
Use this checklist to separate Indiana’s employee statement from the state-and-county withholding calculation and the employer’s unemployment and workers’ compensation responsibilities.
When a statement is required
If the employer is subject to the Indiana Minimum Wage Law, furnish each employee with the required wage statement as part of the payroll process.
Information to include
Show the hours worked by the employee, wages paid to the employee, and a listing of the deductions made.
State and county withholding
Apply Indiana’s current state rate and the county rate that applies under the Department of Revenue’s current withholding guidance. Use the employee’s withholding and county-status information rather than assuming the worksite alone determines every county calculation.
Other employer obligations
Review Indiana unemployment insurance and workers’ compensation independently. UI uses its own taxable wage base and assigned employer rate, while workers’ compensation depends on the employer and worker’s status under Indiana law.
PAYROLL RECORDS IN PRACTICE
How Indiana treats the payroll record after payday
Keep the statement tied to the actual hours and deductions
Indiana’s required statement focuses on hours worked, wages paid, and deductions. The payroll record should therefore reconcile directly to the time or salary basis, gross wages, deductions, and net payment used for that pay period.
Retain the supporting records
Preserve the time, wage, deduction, withholding, unemployment, and payment records required by the state and federal rules that apply to the employer. The statement itself should remain supportable from those underlying records.
STATE AND COUNTY WITHHOLDING — USE THE CURRENT DOR NOTICE
Indiana payroll can require two income-tax withholding layers
Indiana’s 2026 individual adjusted-gross-income tax rate is 2.95%, but that is only one part of the payroll calculation. County income taxes can also be withheld, and the Department of Revenue notes that county rates may be adjusted in January and October. Departmental Notice #1 is the controlling rate reference for withholding agents.
Indiana state income-tax rate
The Indiana Department of Revenue lists a 2.95% individual adjusted-gross-income tax rate for 2026. The state rate is scheduled to change again in 2027, so do not carry the 2026 rate forward automatically.
View current rates →County income-tax withholding
County rates can change during the year. Use the current Departmental Notice #1 and Indiana’s county-rate resources for the pay period rather than embedding a January rate indefinitely. Form WH-4 captures employee withholding exemptions and county-status information used in payroll setup.
Open the DOR Tax Library →LOCAL CONSIDERATIONS
County income tax makes residence and employment location part of Indiana payroll
Indiana’s local payroll issue is county income tax rather than a patchwork of city paystub rules. County rates can differ and can change during the year. The Department of Revenue instructs withholding agents to use Departmental Notice #1, and the employee’s county status should be collected accurately through the applicable withholding process.
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Indianapolis / Marion CountyFor an employee connected to Marion County, use the current Departmental Notice #1 to determine the applicable county withholding rate rather than relying on a prior-year percentage.
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Fort Wayne / Allen CountyAllen County withholding should be checked against the same current DOR notice. Keep the county calculation separate from Indiana’s 2.95% statewide rate.
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Gary / Lake CountyLake County employees can have cross-border commuting patterns with Illinois. Confirm the employee’s residence, principal employment facts, and the current Indiana county-withholding rule before finalizing payroll.
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South Bend / St. Joseph CountyUse the current St. Joseph County rate from Indiana’s official DOR source and retain the employee’s county-status information supporting the withholding setup.Official county-rate source
A SOURCE-BACKED WORKFLOW
A source-backed workflow for Indiana payroll records
1Confirm employee and county statusCollect the employee’s Indiana withholding information and the county-status details needed to determine state and county withholding for the pay period.›
2Enter hours, wages, and deductionsRecord hours worked, pay rate or salary basis, gross wages, deductions, pay-period dates, and the employer and employee details needed for the payroll record.›
3Review state, county, and UI calculationsApply the current 2.95% state framework and the effective county rate, then review unemployment treatment separately using the employer’s assigned UI rate and $9,500 wage base.›
4Generate the employee statementProduce the Indiana statement showing hours worked, wages paid, and deductions together with the supporting payroll and bookkeeping records.›
5Retain supporting recordsKeep the source records supporting hours, wages, deductions, state and county withholding, unemployment reporting, and workers’ compensation obligations.›
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OFFICIAL INDIANA SOURCES USED FOR THIS PAGE
Official Indiana sources used for this page
This guidance is based on Indiana government sources. State and county tax rates, unemployment rates, and agency guidance can change, so recheck the applicable source before acting.
01
Indiana Employment Law Poster · Minimum Wage Law
Official state material stating that covered employers must furnish employees a statement of hours worked, wages paid, and deductions.
02
Indiana Department of Revenue · Rates, Fees & Penalties
Official 2026 statewide individual adjusted-gross-income tax rate and notice that county rates can be adjusted in January and October.
03
Indiana DOR Tax Library
Current Departmental Notice #1 and county income-tax resources used by withholding agents.
04
Indiana DWD · Unemployment Rate Computation
Official 2026 taxable wage base and minimum, typical new-employer, good-standing maximum, and delinquent maximum rates.
05
Indiana Workers’ Compensation Board
Official employee-eligibility guidance explaining that most businesses must maintain workers’ compensation insurance and coverage generally begins on the first day of work.
RESEARCH & REVIEW
Built from primary sources. Reviewed for accuracy.
This page is built from primary Indiana state government sources and is periodically reviewed against current agency guidance. We use official wage, state and county tax, unemployment, and workers’ compensation resources whenever available.
FREQUENTLY ASKED QUESTIONS
Indiana pay-statement FAQ
Does Indiana require a pay statement?
Indiana requires employers subject to the Indiana Minimum Wage Law to furnish employees with a statement showing the hours worked, wages paid, and deductions made.
What is Indiana’s state income-tax rate for 2026?
The Indiana Department of Revenue lists a 2.95% individual adjusted-gross-income tax rate for 2026. Payroll withholding should still follow the current employer guidance and employee withholding information rather than using the rate in isolation.
Does Indiana have county income-tax withholding?
Yes. County income-tax rates can apply in addition to the statewide tax. DOR notes that county rates may be adjusted in January and October, so use the current Departmental Notice #1 for the payroll period.
What is Indiana’s unemployment taxable wage base in 2026?
Indiana taxes the first $9,500 of gross wages per employee for unemployment purposes in 2026.
What is the typical Indiana new-employer UI rate?
Indiana lists a typical new-employer rate of 2.50%. The 2026 minimum rate is 0.50%, the maximum good-standing rate is 7.40%, and the maximum delinquent rate is 9.40%.
Is workers’ compensation required in Indiana?
Indiana states that most businesses must have workers’ compensation insurance. Coverage and exemptions depend on the employer and worker’s legal status, so review Workers’ Compensation Board guidance for the specific business.
ACCURATE RECORDS. SUPPORTING EVIDENCE.
Use accurate records, review the preview, and keep the supporting evidence.
Prepare an Indiana Pay Run, review state and county withholding before completion, and keep the applicable Indiana sources with your payroll workflow.