TAX & LICENSE / STATE TAX SYSTEM
KENTUCKY TAXES
State Income Tax
Kentucky imposes a tax on personal income, using the adjusted gross income reported on the federal income tax return minus allowable credits and deductions. The graduated tax rate falls between 2 and 6 percent, varying with filing status, income level, credits, and allowable deductions. A low-income tax credit is available to qualified taxpayers whose adjusted gross income falls beneath specified limits. For more information on the complete tax structure used by the Commonwealth of Kentucky or for answers to your specific questions, contact:
Kentucky Department of Revenue
Frankfort 502-564-4581
http://revenue.ky.gov
Louisville Taxpayer Service Center
620 South Third Street
Louisville 502-595-4512
http://revenue.ky.gov
Taxpayer Ombudsman
Frankfort 502-564-7822
https://revenue.ky.gov/Get-Help/Pages/Taxpayer-Ombudsman.aspx
Sales and Use Tax
Kentucky imposes a state sales and use tax of 6 percent on most retail items, with no local sales taxes. Some exemptions apply and include residential utilities, prescription medicines, and specific medical supplies. Use taxes are due on all items purchased outside of Kentucky like catalog or Internet orders where tax has not already been paid. Use tax payments can be filed at the time of each purchase or paid annually at income tax filing time.
Inheritance & Estate Tax
Inheritance taxes in Kentucky are based on the value of transferred property as well as the relationship of the beneficiary to the decedent. Estate taxes are based on the federal estate and gift tax guidelines. The estate tax is equal to the amount by which the credit for state death taxes exceeds the Kentucky inheritance tax.
Property Taxes
Property tax is levied on fair cash value of all real, tangible, or intangible property unless exempt. All locally taxed property is subject to county and school district taxes, and property inside city limits may also be subject to city property tax. Special local jurisdictions like fire protection, watershed, and sanitation districts often levy taxes in their operating areas. For more information or answers to questions, contact the property evaluation administrator in your county or the Kentucky Revenue Cabinet.
Kentucky Revenue Cabinet
502-564-4581
http://revenue.ky.gov
