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Jeremy Muchnick

Two Indiana Counties Will Increase Income Tax Rates on October 1, 2021

Effective October 1, 2021, the Indiana Department of Revenue has issued a new Departmental Notice No. 1How to Compute Withholding for State and County Income Tax. Two counties—Owen and Warrick—are increasing their county income tax rates.

  • Owen—increases to 0.025 from 0.016
  • Warrick—increases to 0.01 from 0.005

All 92 of Indiana’s counties impose a county income tax on residents of the county and on nonresidents—who do not reside in another Indiana county—with a principal place of business or employment in the county. Each county has one county income tax rate (i.e., tax rates are the same for residents and nonresidents). Employers withhold state and county income taxes from employees’ wages.

Over the last several months, we have received requests from our clients to assist in these areas and we heard them loud and clear.  As a result, Thomas & Company now offers State & Local Tax Account Registration Services!  We have team members with 20+ years of experience in tax registrations and we would be happy to assist you!  See our recent announcement here.

If you are interested in Thomas & Company partnering with your team to provide these additional services, feel free to contact Jeremy Muchnick, our Director of Tax Recovery Services, at jmuchnick@thomas-and-company.com.

State & Local Tax Registration Services

As a result of COVID-19, employers are now empowered with a new work environment for employees.  Many employers are now giving their employees the option to work from home.  Also, employers are hiring across the country despite where the corporate headquarters or physical work locations are positioned.  From a Payroll Tax prospective, employers may have to register for new state unemployment, state withholding and local income tax account numbers that are not currently set-up in that state or locality.

Registering for tax accounts can be very time consuming for any Payroll Department, especially if they have never registered in that jurisdiction.  Each state and locality have their own nuances and registration processes.  Employers will need to complete these for the employee that is working from home prior to the first pay date.

One of the most tedious payroll tax registrations to complete are local income tax accounts.  There are over 4,000 taxing jurisdictions across 17 states.  Depending on the state, local income taxes may be levied by county, municipality, school district, etc.

For example, there are over 2,500 municipalities and approximately 400 school districts that impose income or wage taxes in Pennsylvania and over 600 municipalities and approximately 200 school districts in Ohio.

Over the last several months, we have received requests from our clients to assist in these areas and we heard them loud and clear.  As a result, Thomas & Company now offers State & Local Tax Account Registration Services!  We have team members with 20+ years of experience in tax registrations and we would be happy to assist you!

If you are interested in Thomas & Company partnering with your team to provide these additional services, feel free to contact Jeremy Muchnick, our Director of Tax Recovery Services, at jmuchnick@thomas-and-company.com.