Kentucky State Tax Calculator (2026)

How Kentucky taxes income

Kentucky charges flat 3.5%. State tax is a separate calculation from your federal return rather than a share of it — Kentucky sets its own schedule and its own definition of taxable income.

• Rate: 3.5% on all taxable income
• Brackets: A single rate, so no bracket to cross
• Standard deduction: $3,360 single / $3,360 joint
• Personal exemption: None

Rate figures are as of January 1, 2026 and come from the published Tax Foundation compilation; they have not been independently checked against Kentucky Department of Revenue. States do change rates mid-year, so confirm a figure there before relying on it.

What catches people out in Kentucky

• Kentucky applies one rate of 3.5% to all taxable income, so your marginal and average state rates are the same and extra income does not push you into a higher band.
• The Kentucky standard deduction is $3,360 for a single filer and $3,360 for a couple filing jointly. It is a separate figure from the federal standard deduction and usually much smaller, so itemising is a decision you make once federally and again for the state.
• Local income taxes are excluded, and Kentucky's average local rate is 0.93% of AGI (footnote a). Kentucky's standard deduction is NOT doubled for joint filers - the figure is the same for both, which is why many married Kentucky filers file separately (footnote z). The flat rate fell from 4% to 3.5% on 1 January 2026.

What this estimate leaves out

Three things are deliberately outside this calculation, because they change more often than annually and a confident wrong number does real damage on a tax page.

• Personal exemptions are not applied.
• Local and city income tax is not included. New York City is the significant one nationally.
• State-specific credits, subtractions and income addbacks are out of scope and can move the result either way.

If you have income in India, Kentucky is where treaty relief runs out

States are not parties to the India-US tax treaty, and a state credit for "taxes paid to other jurisdictions" almost always means other US states rather than other countries.

So NRO interest, Indian rental income or a gain on Indian shares can be taxed by Kentucky with no credit for the Indian tax deducted at source — even though Form 1116 largely neutralises that same tax federally.

The treatment is not uniform across states, so treat this as the general position rather than as Kentucky's confirmed one, and check the credit rules with Kentucky Department of Revenue before relying on relief.

Sources

• Tax Foundation — 2026 State Income Tax Rates and Brackets
• Kentucky Department of Revenue — the authority for Kentucky