2026 tax year · Indiana
Rental host taxes in Indiana
Airbnb, Turo and the rest report your gross and withhold nothing. The gap between that and what you are taxed on is your costs, in Indiana that gap is worth $2,529 in tax.
Take a driver who grossed $39,000 over 18,000 business miles. After mileage at 74.3 cents and the rest of the stack, worked through on the rental host page $10,100 comes off and $28,900 is left as taxable profit. That profit is what Indiana and the IRS charge against.
What that leaves you owing in Indiana
Indiana taxes income at a flat 2.95% for 2026, applied on top of federal income tax and self-employment tax.
| Self-employment tax | $4,083 |
| Federal income tax | $861 |
| Indiana income tax | $792 |
| Total tax | $5,736 |
| Effective rate on gross | 14.7% |
Earning more in Indiana
A single filer taking the standard deduction, this work as the only income, the calculator above handles the other filing statuses. Miles rise with earnings, so the deduction rises too, and the effective rate on gross climbs more slowly than it would for someone whose income grew without expenses attached:
| Volume | Gross | Mileage off | Taxable profit | Indiana tax | Total tax | Rate on gross |
|---|---|---|---|---|---|---|
| Part-time | $13,000 | $0 | $13,000 | $356 | $2,193 | 16.9% |
| Steady side income | $39,000 | $0 | $39,000 | $1,069 | $8,266 | 21.2% |
| Full-time | $63,000 | $0 | $63,000 | $1,727 | $14,456 | 22.9% |
Indiana specifics that change the number
On the 2026 rate itself: rate has been decreasing. Some counties add local income tax.
Indiana also has local income tax that the estimate above does not model, all 92 counties levy local income tax (0.50% to 2.90%).. Add it separately for where you live and work.
Local taxes on an Indiana let
The income tax below is only part of it. Short-term lets attract occupancy, lodging or transient taxes levied by the city or county rather than Indiana, often at rates that dwarf the state income tax. Some platforms collect and remit them; some collect only part; in some places the host is on the hook entirely. That is a local question this calculator cannot answer, and it is the one hosts most often get wrong.
On $28,900 of profit, what the states around Indiana would charge:
| State | Its tax | vs Indiana |
|---|---|---|
| Ohio | $78 | −$774 |
| Kentucky | $1,012 | +$159 |
| Michigan | $1,228 | +$376 |
| Illinois | $1,431 | +$578 |
- Ohio would take $774 less, $78 against Indiana's $853.
- Kentucky would take $159 more, $1,012 against Indiana's $853.
- Michigan would take $376 more, $1,228 against Indiana's $853.
- Illinois would take $578 more, $1,431 against Indiana's $853.
Rental host tax questions in Indiana
How much should an Indiana host set aside?
About 14.7% of gross on the $39,000 example, $5,736 across self-employment tax, federal income tax and $792 to Indiana. In practice that means moving about $147 of every $1,000 payout into a separate account the day it lands, and sending roughly $1,434 to the IRS each quarter, no platform withholds any of this for you. Set aside from each payout rather than finding it in April.
Does the $39,000 on my 1099-NEC match what Indiana taxes?
No. Indiana taxes profit, not gross. After $10,100 of deductions the taxable figure is $28,900, so the Indiana bill is $792 rather than what gross alone would suggest. The form reports what the platform paid out, it knows nothing about your costs, and no one subtracts them for you. On this example 26% of the gross never becomes taxable income, but only for the host who kept the records to prove it.