Indiana PEO Laws: Registration, Bonding and Payroll Requirements
Indiana PEOs register with the Department of Insurance under IC 27-16 (full, limited, or certified), showing $50,000 net worth or a bond, with annual $250 renewals due December 31. SUI applies to the first $9,500 of wages at a 2.50% new-employer rate. Minimum wage is $7.25; no comp state fund or paid-leave mandate exists.
| PEO registration or licensing required | Yes - PEOs doing business in Indiana must register with the Indiana Department of Insurance (IDOI) under IC 27-16, with additional guidance in 760 IAC 1-73; three paths exist: full registration (Indiana-domiciled or home state without substantially similar requirements, with a $250 first-time fee), limited registration (home state requirements substantially similar or more restrictive), and certified registration (ESAC-certified PEOs) source (opens in new window) |
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| Regulating agency | Indiana Department of Insurance (IDOI) - administers PEO registration under IC 27-16 and 760 IAC 1-73; Indiana Department of Workforce Development (DWD) handles unemployment insurance source (opens in new window) |
| Bond or security requirement | No bond required for full registrants that demonstrate at least $50,000 net worth; a PEO that cannot demonstrate $50,000 net worth must file a $50,000 bond with the commissioner (or other security acceptable to the commissioner) under IC 27-16-4-4; limited registrants from comparable home states are not required to prove net worth or bond source (opens in new window) |
| Registration renewal cycle | Annual - a certificate of registration expires on December 31 of each year; the renewal application and a $250 renewal fee are due on or before December 31 (IC 27-16-4-8); renewals are processed through the SIRCON system and paid annually by calendar year source (opens in new window) |
| SUI taxable wage base | $9,500 per employee per calendar year (2026) source (opens in new window) |
| New-employer SUI rate | Typical new employer rate 2.50% ($237.50 maximum cost per employee); state minimum 0.50%, maximum in good standing 7.40%, maximum delinquent rate 9.40%; new employers and employers restarting after a year or more have fixed rates by industry source (opens in new window) |
| State workers' comp fund | No - Indiana maintains a competitive workers' compensation market; employers purchase coverage from licensed private insurers and there is no state fund source (opens in new window) |
| State paid leave mandate | No - no state paid sick leave or other paid leave mandate source (opens in new window) |
| State minimum wage | $7.25 per hour (state minimum is set at the federal FLSA minimum under IC 22-2-2-4; Indiana has no higher state rate) source (opens in new window) |
| PEO SUI reporting basis | PEO-level - under IC 22-4-6.5, a PEO acts as employer of record under a co-employment agreement and reports wages under the PEO's FEIN; a PEO-level PEO reports all clients under a single SUTA account and merit rate, while a client-level PEO reports under the PEO's FEIN but keeps each client's own SUTA account and merit rate; PEO and client are jointly and severally liable for UI taxes source (opens in new window) |
Sources
- IDOI - PEO registration page (IC 27-16; full, limited, and certified registration; 760 IAC 1-73) — verified 2026-08-12
- IDOI - PEO registration administered by the Indiana Department of Insurance — verified 2026-08-12
- Ind. Code 27-16-4-4 - $50,000 net worth or bond in lieu required of full registrants — verified 2026-08-12
- Ind. Code 27-16-4-8 - certificates expire December 31; renewal application and $250 fee due on or before December 31 — verified 2026-08-12
- Indiana DWD - Rate Computation: premiums on the first $9,500 of gross wages per employee per year — verified 2026-08-12
- Indiana DWD - Rate Computation: typical new employer 2.50%, minimum 0.50%, maximum in good standing 7.40% — verified 2026-08-12
- IDOI - Indiana workers' compensation: competitive market of licensed private insurers, no state fund — verified 2026-08-12
- NCSL - Paid Sick Leave tracker (Indiana not among states with paid sick leave mandates) — verified 2026-08-12
- Ind. Code 22-2-2-4 - minimum wage set at the federal minimum wage ($7.25) — verified 2026-08-12
- Indiana DWD Employer Guide - PEO chapter (IC 22-4-6.5): wages reported under PEO FEIN; PEO-level vs client-level SUTA accounts; joint and several liability — verified 2026-08-12
What we know about Indiana
Indiana regulates professional employer organizations from an unusual seat: the insurance department. IC 27-16, supplemented by 760 IAC 1-73, requires every PEO doing business in the state to register with the Indiana Department of Insurance, and the department's registration page lays out three tiers. Full registration is for a PEO domiciled in Indiana or in a state whose licensing or registration requirements are not substantially similar or more restrictive; it carries a $250 first-time fee and requires proof of $50,000 net worth. Limited registration is available to a PEO domiciled, licensed, or registered in a home state with substantially similar or more restrictive requirements and costs a flat $250, with no additional net worth or bond if the home state requires at least $50,000 net worth or bond. Certified registration lets an ESAC-certified PEO register by submitting its certification documents for the same $250 fee.
The financial requirement is a net worth test rather than a bond-first regime. Under IC 27-16-4-4, an applicant for initial registration must demonstrate a net worth of at least $50,000, and an applicant that cannot must file a $50,000 bond with the commissioner or other acceptable security. Renewals run annually by calendar year through the state's SIRCON system for $250, and IC 27-16-4-8 fixes December 31 as the expiration date for each year's certificate, with the renewal application due on or before that date.
Unemployment insurance in Indiana runs on a $9,500 taxable wage base per employee per calendar year. DWD's rate computation page shows a typical new employer rate of 2.50 percent, a state minimum of 0.50 percent, a maximum in good standing of 7.40 percent, and a 9.40 percent maximum delinquent rate; new employers and employers restarting Indiana employment after a break of a year or more receive fixed rates by industry, and employers with three or more years of experience are rated on claims usage and potential liability.
Indiana's SUI reporting is codified around the co-employment relationship. The DWD employer guide's PEO chapter, citing IC 22-4-6.5, explains that a PEO acts as employer of record and reports wages under the PEO's FEIN, with the PEO and client jointly and separately liable for UI taxes. A PEO-level PEO holds one SUTA account for all clients, which share a single merit rate, while a client-level PEO reports under its own FEIN but leaves each client's SUTA account - and each client's merit rate - intact. Joining a PEO-level PEO moves 99 percent of the client's experience balance into the PEO's account; exiting pulls a 0.1 percent transfer back out.
The remaining labor economics are familiar midwestern numbers: the minimum wage is the federal $7.25 under IC 22-2-2-4, Indiana has no state paid leave mandate, and workers' compensation is written entirely by licensed private insurers in a competitive market with no state fund.
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