Indiana employer payroll tax calculator 2026
Hiring in Indiana? New Indiana employers pay 2.5% state unemployment tax on the first $9,500 of each employee's wages, on top of the federal 6.2% Social Security, 1.45% Medicare and FUTA. For a $60,000 employee that's about $4,870 a year in employer payroll taxes — $237.50 of it to Indiana.
| Wages | $60,000.00 |
| Employer Social Security | $3,720.00 |
| Employer Medicare | $870.00 |
| FUTA (0.6% on $7,000.00) | $42.00 |
| State unemployment insurance (SUI) (2.5% on $9,500.00) | $237.50 |
| Employer payroll taxes | $4,869.50 |
| Total cost before benefits | $64,869.50 |
Per two-week payroll: $2,494.98. Add health insurance, retirement and workers' compensation in the cost of an employee calculator.
Indiana unemployment tax (SUTA) for new employers
Most new employers pay 2.5% for their first four years; construction employers can be assigned a different rate.
After a few years the state assigns your own rate based on your layoff history; enter it in the calculator once you have it. Your rate also earns the usual federal FUTA credit: pay Indiana on time and FUTA is 0.6% on the first $7,000. If Indiana ends up a credit-reduction state for the year (the Department of Labor lists them each November), FUTA is higher.
Other Indiana payroll programs
- Indiana county income taxes are withheld from employees' pay.
What an employee costs in Indiana
| Salary | Federal employer taxes | Indiana employer taxes | Total cost | Taxes as % of pay |
|---|---|---|---|---|
| $40,000 | $3,102.00 | $237.50 | $43,339.50 | 8.3% |
| $60,000 | $4,632.00 | $237.50 | $64,869.50 | 8.1% |
| $100,000 | $7,692.00 | $237.50 | $107,929.50 | 7.9% |
A year, before benefits. New-employer rates, 5 employees, full FUTA credit.
How much does a $40,000 employee cost in Indiana?
About $43,340 a year: the $40,000 salary plus $3,102.00 of federal employer taxes and $237.50 of Indiana employer taxes, before benefits. That's $1,666.90 per two-week payroll.
How much does a $60,000 employee cost in Indiana?
About $64,870 a year: the $60,000 salary plus $4,632.00 of federal employer taxes and $237.50 of Indiana employer taxes, before benefits. That's $2,494.98 per two-week payroll.
How much does a $100,000 employee cost in Indiana?
About $107,930 a year: the $100,000 salary plus $7,692.00 of federal employer taxes and $237.50 of Indiana employer taxes, before benefits. That's $4,151.13 per two-week payroll.
Both halves of one paycheck
On a $60,000 salary paid every two weeks, the employee sees $11,350 a year taken out of pay — federal income tax, their own Social Security and Medicare and Indiana taxes — and takes home $48,650 (single filer, standard W-4). That money is withheld from their wages, not an extra cost to you. On top of the salary, you pay $4,869.50 of employer taxes. See the employee's side line by line in the Indiana paycheck calculator.
More employer tools
Cost of an employee (benefits and cost per hour) · Employer payroll tax calculator (all states) · Employer payroll taxes guide
Indiana figures checked 2026-09-28 against the state's own publications. Planning estimate, not a payroll return: your rate notice and the state's rules decide the final amount.
Sources
- Indiana DWD — New employer premium rate — most new employers are assessed 2.5% for the first four calendar years (checked 2026-09-28)
- Indiana DWD — Rate computation — premiums on the first $9,500 of gross wages per employee
- IRS Publication 15 (2026), Employer's Tax Guide — 2026 employer Social Security and Medicare rates and wage limits; FUTA
- IRS — FUTA credit reduction — 6.0% FUTA on the first $7,000; usual 5.4% credit; credit-reduction states lose part of the credit
- U.S. Department of Labor — FUTA credit reductions — the list of credit-reduction states for each year (checked 2026-09-28)
Questions
What is the Indiana SUTA rate for new employers?
2.5% in 2026, on the first $9,500 of each employee's wages. Most new employers pay 2.5% for their first four years; construction employers can be assigned a different rate.
What is the Indiana unemployment tax wage base for 2026?
$9,500 per employee per year.
How much does it cost to employ someone for $60,000 in Indiana?
About $64,870 a year before benefits: $4,632.00 of federal employer taxes and $237.50 for Indiana, at the new-employer rate with 5 employees.