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Contractors Doing Business in Indiana

Independent contractors doing business in the state of Indiana are required to file a statement and documentation with the Indiana Department of Revenue (DOR) to obtain independent contractor status.

Individuals who wish to receive a certification as an independent contractor for worker’s compensation purposes are required to file a certificate of exemption with DOR confirming independent contractor status. This will also be reviewed and processed by the Worker’s Compensation Board of Indiana. A $20.00 filing fee is required and validates the certificate for one year.

Generally, independent contractors do not have income tax withheld by businesses that they contract with for services. Independent contractors are required to file quarterly estimated income tax payments with DOR.

An independent contractor who hires employees is considered an employer and is required to withhold Indiana adjusted gross and local income taxes from the employees’ wages to be paid to DOR.

More information

You will need to withhold state and county taxes from your employees. Computing withholding taxes for employees will be required. You will also need to report employee income taxes withheld to DOR.