INDIANA RETIREMENT INCOME TAX · TAX YEAR 2026
Does Indiana tax Social Security and retirement income?
Indiana does not tax Social Security benefits. Indiana taxes pensions and 401(k) and IRA withdrawals at its flat rate plus county tax, but exempts military retirement and allows up to $16,000 for federal civil service annuities at 62. A single 67-year-old with $24,000 of Social Security, a $20,000 private pension and $10,000 of IRA withdrawals pays $1,392 in Indiana income tax for 2026. Indiana figures include Marion County tax.
Your estimate
- Indiana income tax
- $1,391.60
- Federal income tax
- $1,810.00
- Total income tax
- $3,201.60
Subtracted from Indiana income
- Social Security
- $11,300.00
- Age 65 exemptions
- $1,000.00
Indiana figures include Marion County tax.
The Unified Tax Credit for the Elderly (65+, AGI under $10,000) and the disability retirement deduction are not modeled.
Indiana tax at different retirement incomes
Indiana income tax for 2026 on a single 67-year-old with $24,000 of Social Security, and on a married couple, both 67, with $20,000 each. Half the pension and IRA income is a private pension and half IRA withdrawals, all received by one spouse in the couple. Indiana figures include Marion County tax.
| Pension and IRA income | Single | Married |
|---|---|---|
| $20,000 | $870 | $746 |
| $40,000 | $1,889 | $1,789 |
| $60,000 | $2,883 | $2,783 |
| $100,000 | $4,871 | $4,771 |
| $150,000 | $7,356 | $7,256 |
Does Indiana tax Social Security?
No. Indiana does not tax Social Security or railroad retirement benefits paid by the U.S. Railroad Retirement Board.
Of the single 67-year-old's $24,000 in benefits, $11,300 is federally taxable and Indiana taxes none of it. Of the couple's $40,000, $28,100 is federally taxable and Indiana taxes none of it.
Does Indiana tax pensions?
Yes. Private pensions and state and local government pensions are taxed, with no pension exclusion. Military retirement pay is deducted in full at any age. Federal civil service annuitants 62 or older can deduct up to $16,000 of the annuity, less the Social Security and railroad retirement benefits they receive.
State tax for a single 67-year-old with $24,000 of Social Security, a $20,000 pension of each type and $10,000 of IRA withdrawals. Excluded is the part of the pension Indiana exempts.
| Pension | Excluded | State tax |
|---|---|---|
| Private | $0 | $1,392 |
| Indiana government | $0 | $1,392 |
| Federal civil service | $0 | $1,392 |
| Military | $20,000 | $398 |
Does Indiana tax IRA and 401(k) withdrawals?
Yes. IRA and 401(k) withdrawals are taxed at the state rate plus county tax, with no exclusion. Qualified Roth IRA withdrawals are not taxed.
With $24,000 of Social Security, $20,000 of IRA withdrawals and no other income, a single 67-year-old pays $870 in Indiana income tax for 2026.
At what age do retirement tax breaks start in Indiana?
At 65. Each person 65 or older gets an extra $1,000 exemption, and $500 more when federal AGI is under $40,000 ($20,000 if married filing separately). The civil service annuity deduction starts at 62.
State tax at each age where the rules change. The single filer has $24,000 of Social Security, a $20,000 private pension and $10,000 of IRA withdrawals; the couple, both that age, has $20,000 of Social Security each and a $30,000 pension and $20,000 of IRA withdrawals.
| Age | Single | Married |
|---|---|---|
| 64 | $1,441 | $2,386 |
| 65Age 65 exemptions | $1,392 | $2,286 |
What the calculator leaves out
The Unified Tax Credit for the Elderly (65+, AGI under $10,000) and the disability retirement deduction are not modeled.
The calculator uses Indiana rules from the 2025 forms and instructions, the latest published.
Federal tax uses the 2026 brackets, the standard deduction with the extra amount at 65, and the $6,000 senior deduction. Estimates assume no other deductions, credits or local taxes except as noted.