Calculate your take-home pay in The Bluegrass State. Kentucky income tax rate: 4%.
Kentucky levies a flat 3.5% income tax on all taxable income. The standard deduction is $3,160 for single filers and $6,320 for married filing jointly. Kentucky has been gradually reducing its rate and has local occupational taxes in some cities including Louisville and Lexington.
| Item | Per Paycheck | Monthly | Annual |
|---|---|---|---|
| Gross Pay | - | - | - |
| Federal Income Tax | - | - | - |
| Kentucky State Tax | $0 | $0 | $0 |
| Social Security | - | - | - |
| Medicare | - | - | - |
| 401(k) + Pre-Tax | - | - | - |
| Take-Home Pay | - | - | - |
Kentucky has a flat income tax rate of 4%. This calculator estimates your take-home pay after federal income tax, state income tax, Social Security, Medicare, and any pre-tax deductions like 401(k) contributions. Enter your salary or hourly wage above to see a detailed breakdown of your paycheck.
Kentucky moved to a flat 4% tax rate in 2024, down from a top rate of 5%. The state starts with federal adjusted gross income and allows a standard deduction of $3,160. Kentucky fully taxes most retirement income, including pensions, 401(k), and IRA distributions, though there is a partial pension exclusion for government retirees. Some cities, including Louisville and Lexington, impose local occupational taxes of 1.5-2.2%.
Regardless of state taxes, all Kentucky workers pay federal income tax using the 2026 brackets: 10% on the first $11,925 of taxable income (single), 12% up to $48,475, 22% up to $103,350, 24% up to $197,300, 32% up to $250,525, 35% up to $626,350, and 37% on income above that. The standard deduction is $15,000 for single filers and $30,000 for married filing jointly in 2026.
All workers in Kentucky pay Social Security tax at 6.2% on wages up to $176,100 (2026) and Medicare tax at 1.45% on all wages. An additional 0.9% Medicare surtax applies to wages over $200,000 for single filers. These federal payroll taxes apply uniformly regardless of which state you live in.
Pre-tax deductions reduce your taxable income for both federal and state purposes. Contributing to a 401(k) (up to $24,500 in 2026, plus $8,000 catch-up if 50+) lowers both your federal and KY state tax bill. Health Savings Account (HSA) contributions ($4,300 individual, $8,550 family in 2026) are also pre-tax. Review your W-4 withholding: if you receive a large refund each year, you may be overwithholding, which means less money in each paycheck. The Tax Bracket Calculator shows your federal marginal and effective rates.
Kentucky's flat 4% income tax (reduced from 4.5% in 2024) makes for straightforward paycheck math. Louisville and Lexington are the major economic centers. Some Kentucky cities levy a local occupational tax of 1-2.5%, which applies to wages earned in those cities regardless of where you live.
Kentucky's recent rate reductions (from 5% to 4% flat) are part of a plan to eventually eliminate the state income tax entirely, contingent on revenue targets. Some Kentucky cities levy occupational taxes of 1-2.5% that apply to all wages earned within city limits. Factor in your city's rate for the complete picture.