What should employers know about the Indiana State Payroll Taxes?
123PayStubs will be suitable for those who are doing payroll on their own. As 123PayStubs covers all the information required for Indiana state withholding taxes and provides you with the exact details to keep payroll under your control.
Apart from the federal withholding, employers in Indiana are also responsible for certain state payroll tax requirements which are listed below.
Indiana State Minimum Wage Requirements
The minimum wage rate or the state of Indiana is the same as that of the Federal minimum wage rate of $7.25/hr. If there are tipped employees, then they must be paid a minimum base wage of $2.13/hr. In case, their tips don’t match up to the federal minimum wage base then the employer must pay the difference.
Also, under the FLSA act and Indiana Minimum Wage Law, employees working more than 40 hours per week must be given overtime at 1.5times their regular rate of pay.
Employees under 20 years of age must be paid a training wage of $4.25/hr for the first 90 days of employment.
Indiana State New Hire Reporting
Federal and state laws require all employers to report their newly hired and rehired employees to the Indiana Department of Labor within 20 days from their date of hire. Employees should be reported even if they work for one day and are then terminated.
If employers fail to report to the state agency then for every new hire there is a penalty of $25. In case the employer conspires with employees to not submit the report, the employer must pay a penalty of $500 per report.
Employers may send copies of the new hire forms to the New Hire Unit via fax or mail or may do it electronically. They can also submit employees’ W-4s instead.
Other than mailing the copies to the new hire unit, there are other options like electronic and non-electronic reporting of new hire forms.
Filing New Hire Report Form Online
Indiana New Hire Reporting Center provides different options to report new hires. Below are those:
- Electronic Reporting: This is the easiest and simplest way to report new hires and offer printable confirmation of reports received.
- Printed List: It is a form of non-electronic reporting where the payroll software creates a printed list of the new hire data to export in the required format and fonts.
Mailing New Hire Report Form
Mail the completed New Hire Report Form to the following address:
Indiana New Hire Center
P O Box 55097
Indianapolis, IN 46205
Indiana State Withholding Tax
The Indiana state requires employers to withhold state income taxes from employee's paycheck in addition to the unemployment taxes. Employers can collect Form WH-4, Employee’s Withholding Exemption, and County Status Certificate from employees to determine the withholding amount.
- The state has a supplemental rate of 3.23% for 2020.
- The state has no state disability insurance but does have local taxes.
- Indiana has reciprocal agreements with Kentucky, Pennsylvania, Michigan, Ohio, and Wisconsin. For more information on reciprocity, please click here.
Indiana State Unemployment Insurance Tax (SUI)
- Indiana SUTA wage base limit for 2020: $9,500
- IndianaSUTA tax rates for 2020: 0.50 to 7.4%
- Indiana SUTA tax rates for new employers: 2.50 to 2.96%
Indiana Local Taxes
Local taxes apply for the state of Indiana. For more information on the local taxes, check this link.
Other Payroll Requirements for Indiana
Indiana Termination Pay: Whether the employees resign on their own or are fired on any grounds, then the final wages must be paid on or before the next regularly scheduled payday on which the employee would have been normally paid had the employee remained employed. For more information on this, check this link.
Remit withholding for child support to
Indiana State Centralized Collection Unit
PO Box 6219
Indianapolis, IN 46206-6219
When is the Indiana state payroll tax payment due?
Indiana state requires tax payments to be made on a monthly and annual basis.
If the payment is due on a Saturday, Sunday, or legal holiday, the due date falls on the next business day
Form UC-1: Quarterly Contribution Report
- Form UC-5: Quarterly Payroll Report
- Form WH-3: Annual Withholding Reconciliation Report
To report both the taxes withheld from employees’ wages and unemployment taxes, employers must have registered with the Indiana Department of Revenue and the Indiana Department of Workforce Development. Upon registration, payments and filings can be done through the department’s online site - INTax.
Indiana State Deposit Requirement
Indiana supports electronic payment and filings of tax returns and unemployment reports to the Department of Revenue and Workforce Development through INTax.
Employers can also manage their tax accounts online. The state also supports tax payments through EFT and ACH credits.
Monthly Tax Deposit Requirement
Form WH-1 is a Withholding Tax Voucher that is required by businesses to file if they are withholding taxes for any employees.
- WH-1 can be filed via paper or electronically through INTax. This is Indiana’s tax filing program with which businesses can easily taxes they withheld.
- If the form isn’t filed correctly, the taxpayer’s amount doesn’t go to the respective counties.
Quarterly Indiana Payroll Tax Filings
Form UC-1 is an Employer’s Quarterly Contribution Report and Form UC-5 is Quarterly Payroll Report that is due on the last day of the month following the end of the quarter (April 30, July 31, October 31, and January 31).
When are Forms UC-1, UC-5, and WH-3 due?
Form UC-1 and UC-5: Quarterly Contribution and Payroll Report that is due on April 30, July 31, October 31, and January 31.
- Form WH-3:Annual Reconciliation Withholding Form that is due in January 31st.
If the deadline falls on a weekend or any legal holiday, then the forms are due by the next business day.
Annual Indiana Payroll Tax Filings
Form WH-3 is an Annual Reconciliation Form for the state and county income taxes withheld for a year, which the employers are required to file by January 31. For more information on this, click here.
Businesses who file 1099 and
W-2 are required to file Form WH-3 electronically.
Also, the state of Indiana requires employers to issue wage and tax statements (Form W-2) to their employees by January 31.
123PayStubs is more than a paystub generator.
No matter which part of Indiana your business operates in, our Indiana paystub generator will let you create pay stubs for your employees and contractors with accurate tax calculations including all cities like Idianapolis, Fort Wayne, Evansville. You only have to provide a few basic information such as company, employee and salary details and our pay stub generator will calculate all the applicable taxes swiftly based on the information provided. It will take less than 2 minutes to generate a pay stub. Employees and contractors in Indiana can use the pay stubs as proof of income.