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Indiana Payroll Taxes for Employers (2026): SUTA and State Programs

Last updated: 2026-10-12 · 2026 rates checked against Indiana DWD's own pages and the other official sources below

Indiana employers pay state unemployment tax (SUTA) on the first $9,500 of each employee's wages in 2026, and new employers pay 2.5% — at most $237.50 per employee for the year. Every Indiana employer also pays federal Social Security (6.2% up to $184,500), Medicare (1.45%) and FUTA (0.6% on the first $7,000).

SUTA wage base
$9,500
per employee, 2026
New-employer rate
2.5%
2026
New-employer max
$237.50
SUTA per employee per year
FUTA
0.6%
$42 per employee

What will payroll taxes cost me in Indiana?

Enter your headcount and average pay to see the employer's share of Indiana and federal payroll taxes for 2026. Change the SUTA rate to the one on your rate notice.

Indiana employer payroll tax estimator · 2026

Runs in your browser · nothing is sent anywhere
2.5% is the 2026 new-employer rate. Enter your assigned rate once you have one.
Estimated annual employer payroll taxes
TaxPer year
Indiana unemployment (SUTA)
2.5% × first $9,500 per employee
$1,188
Federal unemployment (FUTA)
0.6% × first $7,000 after the full state credit
$210
Social Security (employer half)
6.2% × first $184,500
$15,500
Medicare (employer half)
1.45% of all wages
$3,625
Total employer taxes$20,523
Per employee$4,105

Assumes every employee earns the average and works in Indiana all year. Workers' comp premiums and benefits are extra — the payroll cost calculator adds them.

Indiana unemployment insurance tax (SUTA) in 2026

2026 taxable wage base
$9,500 per employee (35th highest of 51)
New-employer rate
2.5%
How the new-employer rate works
Typical new employer 2.5% (construction: lesser of 4.0% or the construction average).
Most a new employer pays per employee
$237.50 (2.5% × $9,500)
Experience-rated range (2026, as published)
0.5% to 7.4%
2025 average employer rate
1.28% of taxable wages (U.S. DOL)
Employee contribution
None — employer-paid only
Agency
Indiana DWD

Same $9,500 wage base as Georgia and West Virginia. Register with Indiana DWD when you first pay wages in Indiana; you get an account number for quarterly wage reports and tax payments.

Federal payroll taxes every Indiana employer pays

  • Social Security: 6.2% from you and 6.2% withheld from the employee, on wages up to $184,500 in 2026.
  • Medicare: 1.45% each on all wages; withhold an extra 0.9% (employee only) on wages over $200,000.
  • FUTA: 6.0% of the first $7,000 per employee, less up to 5.4% credit for Indiana unemployment tax paid on time = 0.6%, or $42 per employee.
  • Federal income tax withholding from each paycheck based on the employee's Form W-4.

Next for Indiana employers: Indiana paycheck calculator (employee withholding) · Indiana new hire reporting · Indiana payday & final paycheck rules · Indiana workers' comp · full payroll cost calculator

Indiana payroll tax FAQ

What is the Indiana SUTA rate for new employers in 2026?

2.5%. Typical new employer 2.5% (construction: lesser of 4.0% or the construction average).

What is the Indiana SUTA wage base for 2026?

$9,500 per employee. Once an employee's 2026 wages pass that amount, you stop paying Indiana unemployment tax on them for the rest of the year. That is the 35th highest wage base of the 50 states and DC (the federal FUTA base is $7,000).

Do employees pay unemployment tax in Indiana?

No. In Indiana unemployment tax is paid only by the employer; it can't be deducted from pay. Only Alaska, New Jersey and Pennsylvania collect an employee share.

What other payroll taxes do Indiana employers pay?

For 2026, Indiana has no statewide paid-leave or disability payroll tax, so the state-level employer tax is unemployment insurance. You still withhold any state income tax from employees' pay.

How much FUTA do Indiana employers pay?

0.6% of the first $7,000 of each employee's wages — $42 per employee per year — after the full 5.4% credit for paying Indiana unemployment tax on time. Indiana is not a credit-reduction state for 2026.

How does my Indiana SUTA rate change after the first years?

New employers keep the new-employer rate until they have enough history to be experience-rated (the timing is set by state law). After that, Indiana DWD assigns a rate each year based on your layoffs and benefit charges; published 2026 rates run from 0.5% to 7.4%. Use the rate on your annual rate notice. The 2025 average employer rate in Indiana was 1.28% of taxable wages.

Official Sources

Figures checked against these sources on 2026-10-12

Related Resources on This Site

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General information, not tax advice. Rates change every year; confirm yours on the notice from Indiana DWD before filing.