Kentucky Paycheck Calculator

Kentucky Income Tax Rate

Kentucky shifted from graduated brackets to a simpler flat tax. From 2018–2022 the flat rate was 5.00%, then dropped to 4.50% in 2023 and 4.00% in 2024. For most workers, employers compute state withholding after pre-tax benefits (traditional 401(k), HSA/FSA, Section 125 health premiums) using your K-4 and pay frequency. Kentucky also has widespread local occupational taxes that are withheld separately by many cities/counties/school districts. Credits, dependents, and supplemental wage methods (bonus/commission) can change per-check results even at the same salary. Always review your pay stub after life events, address changes, or benefit updates to keep withholding accurate.

Kentucky Median Household Income

Kentucky’s median household income has trended upward over the last decade, with brief pandemic-era turbulence and subsequent gains as labor markets tightened. Medians vary by region: Lexington-Fayette and parts of Northern Kentucky typically exceed the statewide figure, while some rural counties trend lower. The values below offer directional, nominal benchmarks for budgeting and offer comparisons. For purchasing-power analysis, look at “real” (inflation-adjusted) dollars and weigh housing, transportation, and childcare costs. Household size and employer benefits meaningfully change take-home value, so pair statewide medians with local data when you evaluate opportunities in different Kentucky communities.

Kentucky Federal Insurance Contributions Act (FICA)

FICA funds Social Security and Medicare and appears on every Kentucky paycheck. Employees pay 6.2% Social Security up to the annual wage base (employers match) and 1.45% Medicare on all wages (also matched). High earners owe an additional 0.9% Medicare surtax above federal thresholds; employers do not match the surtax. Section 125 health premiums typically reduce both income-tax and FICA wages, while traditional 401(k) lowers income-tax wages but not FICA. Because many Kentucky localities levy occupational taxes, your stub will usually list federal tax, FICA, Kentucky state tax, and any local occupational tax separately.

Kentucky Number of Cities with Local Income Taxes

Kentucky has numerous local occupational license taxes (payroll taxes) on wages, set by cities/counties/school districts. Rates vary widely; employers withhold based on where you work (and sometimes where you live).

How Your Kentucky Paycheck Works

Each pay period starts with gross wages. Payroll subtracts pre-tax benefits—traditional 401(k), HSA/FSA, commuter, and pre-tax insurance—to determine taxable wages. Withholding then includes federal income tax (W-4), Social Security and Medicare (FICA), Kentucky state income tax using your K-4, and any applicable local occupational tax where you work (and sometimes where you live). Post-tax deductions (Roth 401(k), garnishments, charitable contributions) occur after taxes and do not reduce taxable wages. Pay schedule—weekly, biweekly, semimonthly, or monthly—changes per-check amounts but not annual liability. Verify city/county codes on pay stubs to ensure correct local withholding.

Kentucky Wage and Hour Laws: Overtime, Pay Frequency

Overtime: Kentucky follows FLSA rules—most non-exempt employees earn 1.5× their regular rate for hours over 40 in a workweek; exemptions apply when duties and salary thresholds are met.
Pay frequency: Employers must establish a regular payday and pay on consistent intervals; semimonthly or biweekly schedules are common. Final-pay and wage-statement requirements apply—check employer policy and any contract terms for timing and itemization details.

FAQs

How do I use the Kentucky Paycheck Calculator?

Enter gross pay, pay schedule, K-4 details, pre-tax benefits, and your work locality to estimate federal, state, and local withholding.

What is Kentucky’s current state income tax rate?

Kentucky uses a flat state rate (see table). Your effective rate depends on income, benefits, and credits.

Do Kentucky cities have income or payroll taxes?

Yes—many cities/counties levy occupational license taxes on wages, withheld in addition to state tax and FICA.

Why is my coworker’s take-home different from mine?

Local tax rates, K-4 elections, pre-tax benefits, and bonuses/commissions can change per-check withholding even at similar salaries.

How do pre-tax 401(k) and HSA contributions affect taxes?

They reduce income-tax wages (and often FICA for health premiums), increasing take-home pay while saving for retirement or healthcare.

Are bonuses taxed differently in Kentucky?

State withholding follows Kentucky tables; employers may use federal percentage or aggregate methods for federal supplemental wages.

How often must I be paid in Kentucky?

Employers set a regular payday and pay consistently—commonly biweekly or semimonthly—subject to state timing and recordkeeping rules.

Do remote workers owe Kentucky state or local tax?

Residents owe state tax on all income; local occupational tax depends on work and sometimes residence location—confirm with payroll.

What shows on a Kentucky pay stub?

Typically federal tax, Social Security, Medicare, Kentucky state tax, local occupational tax, pre-tax deductions, post-tax deductions, and net pay.

Where can I get current Kentucky forms and tables?

Check the Kentucky Department of Revenue for K-4, withholding tables, and local occupational tax information and updates.