Kentucky Paystub Generator

Reading a Kentucky pay stub, line by line

A Kentucky pay stub has the simplest state line in the country — one flat rate, no brackets, no allowances — and then, for most workers, a second line that stings more than the first: the city or county occupational tax. Here is what each line means in 2026:

KY State Income Tax ("KY State Tax", "KY SIT"). Kentucky taxes every filing status at a flat 3.5% for 2026 (KRS 141.020, cut from 4% by HB 1 of 2025). Your employer annualizes your wages, subtracts the $3,360 standard deduction, multiplies by 3.5%, and divides by your number of pay periods — that is the whole 2026 withholding formula. On $3,270 a month it comes to $104.65. There is no personal exemption to claim (Kentucky replaced exemptions with a $10 tax credit on the return in 2005), so Form K-4 has nothing to fill in except four "I am exempt" boxes and an optional extra dollar amount.

Occupational license tax ("Louisville OLT", "Lexington OCC", "Jefferson Co", "Boone Co OLT", "FCPS", "JCPS/Sch Bd"). Kentucky cities, counties and school boards tax wages, withheld on gross pay (no standard deduction, and in most ordinances no pre-tax exclusion) based on where you work — and, for school-board taxes, where you live. A Louisville Metro resident pays 2.2% (Metro 1.25% + TARC transit 0.2% + school board 0.75%); a non-resident working in Louisville pays 1.45%. Lexington-Fayette charges 2.25% on everyone who works there, plus 0.5% for Fayette County Public Schools if you also live there — 2.75% total. Bowling Green is 2.0% (+0.5% Warren County Schools for residents), Owensboro 1.78%, Boone County 0.8% on wages up to $79,494 (max $635.95) plus 0.15% mental-health tax on the first $16,666 and 0.5% for the county school board. A typical Kentucky worker's local line is about 2% of gross — more than half of what the state takes.

Second job? Expect under-withholding. Because the $3,360 deduction is built into every employer's withholding, two W-2s means the deduction is taken twice. The Department of Revenue's own formula notes a second job may need an extra $117.60 a year (3,360 × 3.5%) withheld — ask for it on the K-4's extra-amount line.

What you will NOT see in 2026: an unemployment deduction (Kentucky UI is employer-only, on a $12,000 wage base), a state disability line (no program), a paid family leave line (no program), or a state transit fee (Louisville's 0.2% TARC levy is inside the local 2.2%). If you live in Illinois, Indiana, Michigan, Ohio, Virginia, West Virginia, or Wisconsin and checked box 4 on the K-4, the state line disappears entirely under reciprocity — but the city occupational tax still comes out.

Plus the federal lines on every US stub: federal income tax, Social Security (6.2% up to $184,500 in 2026), and Medicare (1.45%, plus 0.9% on wages over $200,000).

Kentucky paycheck facts — 2026

What you actually take home in Kentucky (2026 estimates)

Estimated for a single filer taking the standard deduction, including federal income tax, Social Security, Medicare, and Kentucky state tax (3.5% after the $3,360 standard deduction). The main rows include no local occupational tax — the rate depends on your city and county — so the Louisville and Lexington rows below show what a typical local line does to the same salary:

Where the money goes at $60,000: Kentucky state tax is exactly $1,982.40 — 3.3% of gross — and, because the withholding formula is the same as the return formula, your stub withholds that same $1,982.40 across the year (your return knocks off a further $10 personal credit). Federal income tax and FICA take about $9,610, or 16%.

Your city changes the number more than the state does: a Louisville resident pays $1,320 of occupational tax on $60,000 and keeps about $47,088; a Lexington resident working in Fayette County pays $1,650 (2.25% city + 0.5% schools) and keeps about $46,758. Two co-workers with identical pay can have different stubs — the school-board share only applies if you live in the district.

Methodology: 2026 federal brackets and $16,100 standard deduction (IRS Rev. Proc. 2025-32), FICA per SSA, Kentucky flat 3.5% (KRS 141.020(2)(f)) after the $3,360 standard deduction (Department of Revenue 2026 Withholding Tax Formula, 42A003), Louisville Metro 2.2% resident rate (Revenue Commission Form W-1 KJC instructions) and Lexington-Fayette 2.25% plus 0.5% Fayette County Public Schools on gross wages. Estimates only — your withholding depends on your W-4/K-4, city and county of work and residence, credits, and pre-tax benefits.

What Kentucky jobs pay (BLS, May 2025)

Kentucky's median hourly wage across all occupations is $22.56 — 8% below the national median of $24.51 — with a mean annual wage of $58,990. A Kentucky waiter's BLS median is $14.26 an hour with tips, nearly seven times the $2.13 cash wage the law requires. A software developer at the state median ($109,010) pays about $3,698 in Kentucky state tax — and, if they live in Louisville, another $2,398 to the city.

Kentucky's workforce in numbers

• 4.6 million residents, civilian labor force of 2.1 million, unemployment 4.7% (Census 2025 estimate; BLS, July 2026 preliminary)
• 335,592 self-employed (nonemployer) businesses (Census, 2023) — about one for every 14 residents, and 3.6 times the number of businesses with employees
• 1.7 million people on employer payrolls at 94,402 establishments, earning $94 billion a year (Census County Business Patterns, 2023)
• Mean annual wage: $58,990 (BLS OEWS, May 2025)

Kentucky pay rules — the answers people actually need

Final paycheck: the later of your next regular payday or 14 days, whether you quit or were fired. KRS 337.055 says wages are due "not later than the next normal pay period following the date of dismissal or voluntary leaving or fourteen (14) days following such date … whichever last occurs" — one of the few state rules where the 14-day clock can run past the next payday. If you are absent on payday, wages are due on 14 days' demand, and the statute adds that "no employer shall, by any means, secure exemption from this section." Kentucky's definition of wages includes vested vacation, so whether unused PTO is paid out turns on your employer's written policy.

Pay frequency: at least semimonthly (KRS 337.020), and each payday must cover wages earned up to a day no more than 18 days before it. An employee who is absent or otherwise unpaid on payday must be paid within 6 days of demand. Certain executive, administrative, professional, and outside-sales employees are exempt from the frequency rule.

Is a pay stub required? Only if your employer has 10 or more employees (KRS 337.070) — and the requirement is narrower than most states'. The employer must give a paper or electronic statement at the time of payment showing the amount of each deduction and the general purpose for it. The statute does not require gross pay, hours, or rate of pay on the stub. Electronic stubs are allowed, but the employer must provide access to a computer and printer so you can review and print them (2017 amendment, effective June 29, 2017).

Minimum wage: $7.25, the federal rate, unchanged since July 1, 2009, with a $2.13 tipped cash wage for employees earning more than $30 a month in tips (KRS 337.275; the statute auto-tracks any federal increase). Employers may not count tips toward the minimum wage, and tip pooling must be voluntary. Overtime is 1.5× over 40 hours a week and 1.5× for all hours worked on the seventh consecutive day of a workweek (KRS 337.050) — even if you are under 40 hours.

Deductions (KRS 337.060): only those required by law or authorized by you in writing — insurance, medical dues, union dues under a collective agreement. Even with your consent, an employer may not deduct fines, cash-register shortages shared by two or more people, breakage, dishonored checks you had discretion to accept, or losses from faulty work, theft, or customer default unless you acted with willful disregard.

Commuters and reciprocity. Residents of Illinois, Indiana, Michigan, Ohio, Virginia (daily commuters), West Virginia, and Wisconsin who work in Kentucky check box 4 on Form K-4 and pay their home state instead — no Kentucky state line at all. The local occupational tax is withheld regardless, because it is charged on where the work is performed.

City and county occupational taxes — the line that varies (2026)

Kentucky has no city or county minimum wage above $7.25 — local minimum-wage ordinances in Louisville and Lexington were, as we understand it, struck down by the Kentucky Supreme Court in 2016 — that is from memory rather than a source we checked this round — and the statewide rate has not moved since 2009. What does vary by city is the occupational license tax on wages, levied by cities and counties (based on where you work) and by school boards (based on where you live), and withheld by your employer on gross pay:

Rates for Kenton County, Covington, and Daviess County could not be confirmed on their official sites this update and are left out. Many rural counties charge 0.5% to 1.5%; a minority charge nothing. On a $60,000 salary the difference between a Louisville stub and a no-local-tax county is $1,320 a year — two-thirds of the $1,982 the state itself takes.

How Kentucky compares with its neighbors (take-home on $60,000, 2026 est.)

Kentucky's 3.5% is the lowest flat rate among its income-tax neighbors, and Tennessee across the southern border has no wage tax at all. The catch is the local line: add Louisville's 2.2% and a Kentucky worker's state-plus-local bite is about $3,302 on $60,000 — closer to Illinois than to Tennessee. Indiana and Ohio residents who commute into Kentucky pay their home state's income tax under reciprocity but still pay the Kentucky city occupational tax.

(The West Virginia figure is a directional estimate pending that page's full data workup.)

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