Tool | October 2017

State-by-State Guide to Taxes

Compare state tax rates and rules -- on income, ordinary purchases, gas, sin products, property, and more -- across the U.S.

Kentucky

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The Bottom Line
Map of Kentucky

Mixed Tax Picture

To understand Kentucky's painful income tax bite, look at its second-highest tax bracket, which hits taxable income over $8,000 at 5.8%. The net result: high effective income tax rates, even for relatively low earners.

Sales taxes are modest (and not marked up by localities) and the property tax burden is light.

Sales Tax

State levy of 6%.

Income Tax Range

Low: 2% (on less than $3,000 of taxable income)

High: 6% (on more than $75,000 of taxable income)

Effective income tax rate: 5.3%/individual, 5.7%/joint

See Kiplinger.com’s Retiree Tax Map to learn how Kentucky taxes Social Security income and other forms of retirement income.

Motor Fuel Taxes

Gasoline: $0.26 per gallon.
Diesel: $0.23 per gallon.

Property Taxes

The median property tax on Kentucky's median home value of $123,200 is $1,042.

See Kiplinger.com’s Retiree Tax Map for details on tax breaks for seniors in Kentucky.

Vehicle Taxes

A 6% tax is collected at registration. Additionally, the state vehicle property tax rate is $0.45 per $100 of car value; counties and other localities impose an additional levy.

Sin Taxes

Beer: $0.84 per gallon
Wine: $3.330 per gallon
Liquor: $7.54 per gallon


Cigarettes: $0.60 per pack
Snuff: $0.19 per unit of 1.5 ounces
Chewing tobacco: Approximately $0.04 per ounce
Other tobacco products: 15% of wholesale price

Travel Taxes

Hotel: In addition to the statewide lodging tax of 1% (campgrounds are excluded), municipalities can levy additional taxes, and sales tax is also due. In Lexington, Ky., this adds up to 13.4%.

Rental cars: 6% "U Drive It" tax. Sales tax is not due.

Taxes On Wireless Service

10.77%

Inheritance and Estate Taxes

Kentucky has an inheritance tax, but all Class A beneficiaries (spouse, parent, child, grandchild, brother and sister) are exempt. Other beneficiaries are subject to inheritance tax rates ranging from 4% to 16%. There is no estate tax.

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