KentuckySalary Calculator 2026 — Take-Home Pay After Federal & State Taxes

Kentucky reduced its flat income tax from 4.5% to 4.0% in 2024, with legislation targeting further reductions tied to revenue benchmarks. All Kentucky taxable income is taxed at 4.0%. Kentucky uses its own standard deduction — $3,160 for single filers (2026), significantly lower than the federal $15,000. This means Kentucky residents have a higher taxable income base at the state level than the federal level. Louisville and Lexington levy city/county occupational taxes on wages — typically 2.2–2.5% — in addition to the state rate. These local taxes apply to wages earned in those jurisdictions, not just for residents, making Kentucky's effective rate for Louisville workers closer to 6–6.5%. The state exempts Social Security income and has a pension exclusion for retirement income.