Muncie local tax guide
Who pays Muncie's local tax
Delaware County residents, including Ball State University employees who live in Muncie or Yorktown, owe 1.5% on all their Indiana income. Workers who commute in from Madison, Randolph, Jay, or Henry County pay the rate of their home county. Since Madison County charges 2.25%, an Anderson resident with a Muncie job pays more county tax than a co-worker who lives in Muncie. Out-of-state residents whose principal job is in Delaware County on January 1 owe Delaware's rate on wages earned here.
Delaware County's local income tax
Muncie, a city of about 65,000 and home to Ball State, has no city income tax. Delaware County's Local Income Tax is a flat 1.5% on Indiana adjusted gross income, the same base as the 2.95% state tax.
The rate matches Lake County's, so Muncie, Gary, and Hammond workers pay identical county tax at the same salary. It is well below Madison County's 2.25%, a difference of $555 at $75,000.
Worked example: $75,000 in Muncie
On a $75,000 salary, a single filer pays $7,670 in federal tax, $4,650 in Social Security, $1,088 in Medicare, $2,183 in Indiana tax, and $1,110 to Delaware County. Take-home pay is $58,299 a year, roughly $4,858 a month.
Compared with the $59,409 the same worker would keep with no county tax, Delaware County costs $1,110. A Muncie resident earning $60,000 pays $885 in county tax and keeps $47,764.
The Muncie and Anderson corridor
State Road 32 and Interstate 69 link Muncie with Anderson and Indianapolis, and many households commute along them. Because the county tax follows your home, choosing Muncie over Anderson saves about $555 a year at $75,000, and choosing Muncie over Indianapolis saves $385.
If you change counties during the year, the January 1 county still applies through December. File a new WH-4 so the new county's rate starts the following year. Compare on the Anderson calculator.
Withholding and filing
Ball State and other employers withhold county tax from the county codes on Form WH-4. At year end you report Delaware County tax on the IT-40 with the state tax. Out-of-state residents who owe it file Form IT-40PNR. The Indiana state page covers state-level details.
Tips for Muncie paychecks
Compare home counties, not job sites
An Anderson address costs about $555 more in county tax at $75,000 than a Muncie address, even with the same Muncie job.
Keep WH-4 current
An out-of-date county on WH-4 can mean withholding at the wrong rate. Ball State employees who moved should refile after January 1.
Pre-tax plans lower the county bill
Indiana adjusted gross income excludes traditional 401(k) and 403(b) deferrals, so each dollar saved also skips Delaware County's 1.5%.