Personal Income Tax in Kentucky

April 13, 2006

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If you are a resident or nonresident of Kentucky and receive taxable income individually from property owned or business transacted in Kentucky, you are subject to tax on net income. Therefore, if you are operating your business as an S corporation, partnership, limited liability company, or sole proprietorship, you will be subject to a personal income tax on your business income that passes through to you. In addition, qualified local governments in Kentucky are authorized to levy a local income tax, so be sure to check with your local government.

The following rates are applicable to the amount of income over the exempted amount:

Taxable Income	Rate of Tax
up to $3,000	2%
over $3,000 to $4,000	3%
over $4,000 to $5,000	4%
over $5,000 to $8,000	5%
over $8,000 to $75,000	5.8%
over $75,000	6%