Kentucky uses a flat state income tax of 3.5% in 2026 — the same rate applies to every dollar of taxable income, which makes your paycheck easy to predict. On a $75,000 salary, a single filer pays about $2,625 in state tax and takes home roughly $58,968 a year (about 78.6% of gross) after federal, state, and FICA withholding.

Kentucky's 3.5% rate is below the 4.8% average among states that tax wage income. Because the rate is flat, a raise never pushes part of your income into a higher state bracket — every extra dollar is taxed at the same 3.5%, unlike the federal system where higher earnings hit progressively higher brackets.

Remember that FICA is separate from income tax and is not affected by your state. Every worker pays 6.2% for Social Security on the first $184,500 of wages (the 2026 wage base) plus 1.45% for Medicare on all wages. Pre-tax 401(k) and HSA contributions lower your federal and state income tax but do not reduce FICA — a detail that trips up a lot of first-time budgeters.

Kentucky's flat rate has been stepping down in half-point increments as the state hits statutory revenue triggers, part of a long-term plan to shrink reliance on income tax. The bigger paycheck variable is local: many Kentucky cities and counties — Louisville and Lexington included — levy occupational license taxes in the 1–2.5% range on wages earned within their boundaries, withheld automatically by employers.