Yes, you made money in another state. However, if you lived in Kentucky all year, one of your jobs was in Indiana, and you only have W-2 income, you will only need to pay taxes in Kentucky. These two states have a reciprocity agreement for workers who live in one state and work in the other.
Click here for more information on reciprocity agreements.
Because your Indiana employer withheld taxes, you can file an Indiana return just to get a refund of the taxes paid. If you continue to work for that employer, you can request that they don't withhold Indiana taxes, as explained further at the link provided above.
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