Hibou Odoo Suite Enterprise: State of Indiana: Filing State Income Taxes, W-2s, and 1099s

Purpose

The purpose of this documentation is to outline the processes and requirements associated with filing state income taxes as well as how to file W-2s and 1099s, if needed, in the state of Indiana. 

State Income Tax Withholding 

To determine the amount of income tax the should be withheld, employees should complete an Employee's Withholding Exemption and County Status Certificate (Form WH-4). Every employee, on or before the date of commencement of employment, shall furnish his or her employer with a signed WH-4.

Employers are required to keep copies of completed state WH-4 forms for their employees in their files. The forms serve as verification that state income taxes are being withheld according to the employee’s instructions and needs to be available for inspection if the state requests it. 

You may file a new Form WH-4 at any time if the number of exemptions increases. You must file a new Form WH-4 within 10 days if the number of exemptions previously claimed by you decreases for any reason.  

Good to Know!

Indiana does not allow an exempt status for withholding purposes.

Good to Know!

In addition, the employer should look at Departmental Notice #1 that details the withholding rates for each of Indiana’s 92 counties.

State Income Tax Withholding Reporting and Deposits

Your monthly State withholding tax liability determines when you remit the taxes to the State.

FrequencyMonthly state withholding tax liability thresholdDue
Annually$25 or less31 days after the end of the year
Monthly$1,000 or less30 days after the end of the month
Early filerMore than $1,00020 days after the end of the month

You must file Form WH-1 (Indiana Employer's Withholding Tax Return) and remit EFT payments via the state’s INtax system.  

W-2 and 1099 Forms 

You must file copies of Forms W-2 and 1099 (in which Indiana state tax is withheld) to the state by the last day of February following the close of the calendar year with a Form WH-3

At the end of each year, all Indiana employers are required to complete and file an annual reconciliation form (WH-3) by February 28th of the following year.  Any business must file them electronically via the state's INtax program, or use a third-party vendor.