Illinois vs Indiana Payroll Comparison
Compare payroll compliance requirements between Illinois and Indiana. See key differences in wages, taxes, leave policies, and employer obligations.
Compare State Payroll Requirements
Select 2 states to compare their payroll compliance requirements side-by-side.
| Requirement | Illinois | Indiana |
|---|---|---|
| Minimum Wage | ⚠️$15.00/hour (state); $16.60/hour (Chicago large employers) | $7.25 (federal) |
| Tipped Minimum | 60% of minimum wage ($9.00 state) | $2.13 + tips |
| Overtime Threshold | 40 hours/week (1.5x regular rate) | ⚠️40 hours/week (no daily OT) |
| Final Pay (Termination) | Next regular payday | Next regular payday (24 hrs if written request) |
| Final Pay (Resignation) | Next regular payday | Next regular payday |
| PTO Payout Required? | ⚠️Yes (accrued vacation must be paid) | ✓No (unless policy requires) |
| Pay Frequency Mandate | Semi-monthly (most employees) | Bi-weekly or semi-monthly minimum |
| State Income Tax | ⚠️Yes (4.95% flat rate) | ⚠️Yes (3.05% flat rate) |
| Unemployment Insurance | Yes | Yes |
| State Disability Insurance | ✓No | ✓No |
| Paid Family Leave | ✓No (state program not yet enacted) | ✓No |
| Paid Sick Leave | ⚠️Yes (40 hours/year - Paid Leave for All Workers Act) | ✓No |
| Workers' Comp Required | ⚠️Yes (all employers) | ⚠️Yes (all employers) |
| County Income Tax | N/A | ⚠️Yes (0.5% - 3%+ varies by county) |
Key Differences: Illinois vs Indiana
ILIllinois
- Minimum Wage:$15.00/hour (state); $16.60/hour (Chicago large employers)
- Tipped Minimum:60% of minimum wage ($9.00 state)
- Overtime Threshold:40 hours/week (1.5x regular rate)
- Final Pay (Termination):Next regular payday
- Final Pay (Resignation):Next regular payday
- PTO Payout Required?:Yes (accrued vacation must be paid)
INIndiana
- Minimum Wage:$7.25 (federal)
- Tipped Minimum:$2.13 + tips
- Overtime Threshold:40 hours/week (no daily OT)
- Final Pay (Termination):Next regular payday (24 hrs if written request)
- Final Pay (Resignation):Next regular payday
- PTO Payout Required?:No (unless policy requires)
Understanding Illinois and Indiana Payroll Differences
State Income Tax: Illinois has state income tax (Yes (4.95% flat rate)), while Indiana has state income tax (Yes (3.05% flat rate)). This significantly impacts both employer withholding responsibilities and employee take-home pay.
Minimum Wage: Illinois minimum wage is $15.00/hour (state); $16.60/hour (Chicago large employers), compared to Indiana at $7.25 (federal). Employers must pay at least the higher of federal, state, or local minimum wage requirements.
Paid Sick Leave: Illinois: Yes (40 hours/year - Paid Leave for All Workers Act). Indiana: No. States with mandatory paid sick leave require employers to track accruals and provide specific leave entitlements.
For complete compliance requirements, review the full state guides for Illinois and Indiana.