2026 tax year · Indiana
Marketplace seller taxes in Indiana
Etsy, eBay, Shopify and the rest report your gross and withhold nothing. The gap between that and what you are actually taxed on is your costs, in Indiana that gap is worth $6,671 in tax.
Take a driver who grossed $45,000 over 18,000 business miles. After mileage at 74.3 cents and the rest of the stack, worked through on the marketplace seller page $26,775 comes off and $18,225 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 | $2,575 |
| Federal income tax | $67 |
| Indiana income tax | $500 |
| Total tax | $3,142 |
| Effective rate on gross | 7.0% |
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 | $15,000 | $0 | $15,000 | $411 | $2,531 | 16.9% |
| Steady side income | $45,000 | $0 | $45,000 | $1,234 | $9,813 | 21.8% |
| Full-time | $72,000 | $0 | $72,000 | $1,974 | $16,777 | 23.3% |
Switching state opens that state's page.
Enter your numbers and press Calculate to see your 2026 estimate.
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.
Selling into and out of Indiana
Income tax follows you: Indiana taxes your profit wherever the buyer was. Sales tax does not. Marketplace facilitator laws make the platform collect and remit sales tax on your behalf in most states, which is why a seller can have customers in all fifty and still file only one income tax return. Selling off-platform is where that stops being true.
On $18,225 of profit, what the states around Indiana would charge:
| State | Its tax | vs Indiana |
|---|---|---|
| Ohio | $0 | −$538 |
| Kentucky | $638 | +$100 |
| Michigan | $775 | +$237 |
| Illinois | $902 | +$365 |
- Ohio would take $538 less, $0 against Indiana's $538.
- Kentucky would take $100 more, $638 against Indiana's $538.
- Michigan would take $237 more, $775 against Indiana's $538.
- Illinois would take $365 more, $902 against Indiana's $538.
Marketplace seller tax questions in Indiana
How much should an Indiana seller set aside?
About 7.0% of gross on the $45,000 example, $3,142 across self-employment tax, federal income tax and $500 to Indiana. Set aside from each payout rather than finding it in April.
Does the $45,000 on my 1099-NEC match what Indiana taxes?
No. Indiana taxes profit, not gross. After $26,775 of deductions the taxable figure is $18,225, so the Indiana bill is $500 rather than what gross alone would suggest.