Individual Income Tax Rate Changes Announced for 2017

December 19, 2016

Local income tax rates are established or adjusted by county officials and annually reported to the Indiana Department of Revenue. Departmental Notice #1 recently was updated with changes for 2017.

Effective Jan. 1, 2017, the Indiana individual income tax rate is reduced from 3.3 percent to 3.23 percent.

Six counties also changed their county income tax rates effective on Jan. 1, 2017.

The rate changes are as follows:

  • Boone – The rate increased from 0.01 to 0.015.
  • Brown – The rate increased from 0.023955 to 0.025234.
  • Jackson – The rate increased from 0.016 to 0.021.
  • Jennings – The rate increased from 0.0175 to 0.025
  • Noble – The rate increased from 0.015 to 0.0175.
  • Tipton – The rate increased from 0.0198 to 0.026.

Effective Jan. 1, 2017, the local income tax imposed by a county is the same for both residents and nonresidents. For more information about this change, please review Departmental Notice #42.

These rates affect individuals and businesses that have income tax withholdings. But don’t worry – any rate changes effective Jan. 1, 2017, will not have any impact on the 2016 individual income tax filing.