Cost of Doing Business in Southwest Indiana, Southern Indiana

Business Taxes
Indiana's business cost structure is simple and straightforward, with a single corporate income tax, and no franchise or similar tax. Two business taxes, the property tax on inventory and the gross receipts tax were eliminated by the legislature.

Corporate Income Tax: All corporations doing business in Indiana, except S corporations and not-for-profit corporations, pay corporate adjusted gross income tax at a rate of 8.5 percent.

Sales and Use Tax: Six percent of gross income from retail sales. (Exemptions available)

Property Tax: Real and personal property is assessed at 33 1/3 percent of true cash value; property tax rates vary among local jurisdictions. (Exemptions available) Additional business tax and cost comparisons are available from the State of Indiana.

Taxes
Property Tax: Real and personal property is assessed at 33 1/3 percent of true cash value. Property tax rates vary among local jurisdictions. Township tax rates vary.

Tangible Personal Property Tax: All equipment, which includes manufacturing and office, is depreciated by set percentage schedules.

Indiana uses the Federal Depreciating Schedule to determine the True Tax Value of Equipment. Most manufacturing equipment in Indiana falls under Federal Pool #2. Though manufacturing equipment is depreciated quickly in Indiana, its true tax value can never fall to below 30% of its cost. Special valuation procedures apply to special tooling (molds, patterns, and dies), property not placed in service, and air and water pollution control equipment.

Personal Income Tax Rate: State Income Tax is 3.4%, plus county optional income tax with a maximum of 1%

Additional Links for Information
Indiana Economic Development Corporation – Indiana Tax Information
Indiana Economic Development Corporation – Economic and Demographic Profile