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Indiana
Employee Obligations (Which Returns YOU Must File)
Arizona has a reciprocity agreement with Indiana. If your only income from Indiana is wages, salary, tips, or commissions, file your Arizona return only — no Indiana return needed. Give your Indiana employer your reciprocity form (WEC) each year.
Employer Obligations (What Your Employer Must Withhold & Remit)
Reciprocity applies. If the employee provides the reciprocity form (WEC), withhold Arizona tax instead of Indiana tax. Must still register for Indiana unemployment insurance. Register for withholding and unemployment. Must also withhold county income tax. Unemployment applies to the first $9,500 of wages.
City & Local Income Taxes (Extra Filings Beyond the State Return)
All 92 Indiana counties charge income tax on nonresidents ranging from 0.5% to 2.9%. Combined state plus county can reach approximately 5.9%. The M1CR credit does NOT cover county taxes. Separate county withholding is required.
Reciprocity Agreement — File Home State Only for Wages
Arizona has a reciprocity agreement with Indiana. For wage income, you only need to file your Arizona return. Give your employer the reciprocity form (WEC) each year to avoid Indiana withholding.
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This is general information, not tax or legal advice. Laws change frequently. Always consult a licensed CPA or tax attorney for your specific situation. All information researched as of March 21, 2026.