Kentucky tax burden — broken down.
Kentucky’s combined tax burden (income + property + sales) lands at 10.86% on our composite — ranking #28 of 51 jurisdictions. The top marginal individual income tax rate is 4.00%.
Kentucky burden, broken into 3 components
| Component | Kentucky rate | National median |
|---|---|---|
| Top marginal income | 4.00% | ~5.30% |
| Effective property | 0.86% | ~1.07% |
| State sales tax | 6.00% | ~5.50% |
| Combined composite | 10.86% | ~11.87% |
National medians from CalcFi’s 51-state composite. Top marginal is the headline single-filer rate, NOT the effective rate most households actually pay.
Retirement + Social Security in Kentucky
Kentucky taxes most retirement income (pensions, IRA / 401(k) distributions). Social Security benefits are NOT taxed by Kentucky. Federal taxation of these income sources is unchanged regardless of state.
How Kentucky compares
Of all 51 US jurisdictions ranked by combined burden composite, Kentucky sits at #28. That places Kentucky in the middle of the pack — burden is moderate without being a particular outlier in either direction. For the live cross-state heat map, see the interactive tax burden map.
Kentucky metros — local tax overlay
State rates are uniform across Kentucky— but local income, property, and sales taxes vary. Click any metro to run the full income tax calculator pre-populated with that city’s local layer.
- Louisvilleproperty 0.83% · pop 1.4Mmedian $59,600 →
- Lexingtonproperty 0.83% · pop 0.5Mmedian $61,200 →
- Bowling Greenproperty 0.90% · pop 0.2Mmedian $48,500 →
More Kentucky metros coming as we expand city coverage.
Kentucky tax — common questions
What is the Kentucky top marginal income tax rate in 2025?
Kentucky's top marginal individual income tax rate is 4.00% on the highest bracket.
What is the Kentucky effective property tax rate?
Kentucky's statewide effective property tax rate is 0.86% of home value (annual). On a $400,000 home that's roughly $3,440/yr. Local variation can be ±0.5pp.
Does Kentucky tax retirement income or Social Security?
Kentucky taxes most retirement income, and does NOT tax Social Security benefits.
Are there any Kentucky-specific tax quirks I should know about?
KY has a 6% inheritance tax (immediate family exempt; siblings/nephews 4–16%; non-relatives 6–16%) — one of only six remaining inheritance-tax states.
Reviewed by CalcFi Editorial · Source: Tax Foundation State Individual Income Tax Rates (Jan 2025). Last verified 2026-04-19. Methodology at /about/editorial.