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Doing business in

Indiana

Navigate Indiana’s business landscape with ease—whether you’re incorporating, expanding, or managing tax compliance. Commenda helps you stay ahead with automated solutions for incorporation, compliance, and tax filings.
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indiana

Business Overview

Indiana has a strong manufacturing sector, particularly in automotive, steel, and life sciences industries. The state offers a favorable business climate with competitive tax rates, strategic location, and infrastructure investments that support logistics and supply chain operations.

Key Facts & Figures

Category Details
Capital Indianapolis
Major Cities Indianapolis, Fort Wayne, Evansville, South Bend, Carmel
State Sales Tax Rate 7%
Local Sales Tax Rate No local sales tax
Corporate Income Tax 9.5% (including 2.5% replacement tax)
Physical Nexus Threshold Physical presence through employees, offices, inventory, or independent contractors
Economic Nexus Threshold $100,000 in annual sales or 200 transactions

Did you know?

Indiana is home to more manufacturing jobs per capita than any other state, with automotive manufacturing playing a crucial role in its economy.

Setup & Compliance

Indiana offers business-friendly formation processes with moderate regulatory requirements.

Indiana Business Setup Process:

  1. Choose Your Business Structure: Consider tax advantages and liability protection needs.
  2. Register Your Business: File formation documents with the Indiana Secretary of State.
  3. Register for Tax Accounts: Register with the Department of Revenue for sales tax and withholding.
  4. Obtain Required Licenses: Research and secure necessary state and local business licenses.
  5. Register as an Employer: Register with Workforce Development if hiring employees.

Ongoing Compliance Requirements:

  • Business Entity Reports: Most entities must file biennial business entity reports.
  • Sales Tax Collection: Collect and remit 7% state sales tax on taxable transactions.
  • Corporate Income Tax: C-corporations pay 4.9% corporate income tax.
  • Employment Taxes: Employers must register for unemployment insurance and workers’ compensation.
  • Local Requirements: Counties and municipalities may impose additional licensing and regulatory requirements.

Hiring & Payroll

Indiana provides a balanced approach to employment regulations with some business-friendly policies.

Indiana Payroll Requirements:

  • Unemployment Insurance: Rates from 0.5% to 7.4% on first $9,500 of wages.
  • State Income Tax Withholding: Flat 3.23% plus county taxes.
  • Workers’ Compensation: Required for all employers.

Indiana Employment Laws:

  • Minimum Wage: Follows federal minimum wage ($7.25/hour).
  • Overtime: Follows federal regulations.
  • Teen Work Hour Restrictions: More stringent than federal regulations.
  • Final Paychecks: Due on next regular payday.
  • Indiana is an at-will employment state with right-to-work laws.

State Incentives

Indiana provides strategic economic incentives to attract and retain businesses.

Key Business Incentives:

  • Economic Development for a Growing Economy (EDGE) Tax Credit.
  • Venture Capital Investment Tax Credit: Encourages investment in Indiana businesses.
  • Industrial Recovery Tax Credit: Support for businesses in economically challenged areas.

Small Business & Startup Support:

  • Indiana Small Business Development Center: Comprehensive business resources.
  • Next Level Ventures: Support for technology and innovation-driven businesses.
  • Rural Business Development Grants.

Regulatory Considerations

Indiana provides a business-friendly regulatory framework with clear guidelines.

Key Business Regulations:

  • Data Privacy: Laws protecting consumer and business information.
  • Environmental Compliance: Regulations supporting industrial and agricultural sectors.
  • Professional Licensing: Required for various service-based professions.

Additional Regulatory Areas:

  • Manufacturing Compliance.
  • Small Business Reporting Requirements.

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