Lexington Income Tax Calculator
Calculate your take-home pay in Lexington, Kentucky including the 2.25% local income tax on top of Kentucky's 3.5% state rate.
How Lexington's 2.25% Tax Hits at Different Salaries
| Salary | City Tax | Take-Home (with city tax) | Take-Home (without) | City Tax Cost/Month |
|---|---|---|---|---|
| $50,000 | $1,125 | $39,480 | $40,605 | $94 |
| $75,000 | $1,688 | $57,225 | $58,913 | $141 |
| $100,000 | $2,250 | $73,375 | $75,625 | $188 |
| $125,000 | $2,813 | $89,476 | $92,289 | $234 |
| $150,000 | $3,375 | $105,126 | $108,501 | $281 |
| $200,000 | $4,500 | $137,387 | $141,887 | $375 |
Lexington Local Income Tax: What You Need to Know
Lexington/Fayette County imposes a 2.25% occupational tax — slightly higher than Louisville's 2.2%. Combined with Kentucky's 3.5% state rate, Lexington workers pay 5.75% in state and local income tax.
The tax applies to all wages and net profits earned within Fayette County. Both residents and non-residents are subject to the tax if their income is earned in the county.
Home to the University of Kentucky, Lexington's occupational tax is a primary revenue source for city services and has remained stable at 2.25% for several years.
The 2.25% local tax is applied on top of Kentucky's 3.5% state income tax and federal income tax. On a $100,000 salary, Lexington's local tax costs approximately $2,250/year — that's $188/month or $87 per biweekly paycheck.
This tax applies to both residents and non-residents earning income in Lexington. Even if you commute from outside the city, you owe the local tax on wages earned within Lexington.
Other Cities with Local Tax in Kentucky
Frequently Asked Questions
Lexington charges a 2.25% local income tax. On a $100,000 salary, this costs approximately $2,250/year. This tax applies to both residents and non-residents earning income in the city.
Partially. Lexington taxes non-residents on income earned within the city at 2.25%. You'd need to both live and work outside the city to avoid it entirely.
Including Kentucky's 3.5% state rate, Lexington's 2.25% local rate, and federal taxes, a $100K earner pays an effective rate of approximately 26.6%.
Yes, local income taxes are deductible as part of your state and local tax (SALT) deduction if you itemize. However, the SALT deduction is capped at $10,000 ($5,000 for married filing separately), which limits the benefit for many taxpayers.