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Indianaworking inArizona
Reciprocity — home state withholds for you

Arizona

Work State Tax Rate
Flat 2.5%
Withholding Starts
After 60 days
Law Last Updated
Jan 1, 2023

Employee Obligations (Which Returns YOU Must File)

Indiana has a reciprocity agreement with Arizona. If your only income from Arizona is wages, salary, tips, or commissions, file your Indiana return only — no Arizona return needed. Give your Arizona employer your reciprocity form (WH-47) each year.

Employer Obligations (What Your Employer Must Withhold & Remit)

Reciprocity applies. If the employee provides the reciprocity form (WH-47), withhold Indiana tax instead of Arizona tax. Must still register for Arizona unemployment insurance. Register for withholding and unemployment. Unemployment is approximately 2.0% on the first $8,000 of wages.

Reciprocity Agreement — File Home State Only for Wages

Indiana has a reciprocity agreement with Arizona. For wage income, you only need to file your Indiana return. Give your employer the reciprocity form (WH-47) each year to avoid Arizona withholding.

Row last reviewed: Apr 17, 2026Home state credit form: Schedule 2

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.