What it costs to live and work in Kentucky: the minimum wage, state income tax, sales tax and median rent, from official sources, and what they mean for your monthly budget.
| Kentucky | Source | |
|---|---|---|
| Minimum wage | $7.25 an hour | US Department of Labor, State Minimum Wage Laws (updated July 1, 2026) |
| State income tax | 3.5 % flat | Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 |
| State sales tax | 6 % | Tax Foundation, State and Local Sales Tax Rates, Midyear 2026 (as of July 1, 2026) |
| Median gross rent | $998 a month (2024) | US Census Bureau, ACS 2024 1-year estimates, table B25064 Median Gross Rent |
Kentucky's minimum wage is $7.25 an hour, the same as the federal rate.
Kentucky taxes income at a flat 3.5 % in 2026, down from 4 %.
The state sales tax is 6 %, with no local sales taxes on top.
What income does rent in Kentucky take?
A common rule of thumb is to keep rent at or below 30 % of gross income. At the median rent of $998 a month, that means a household income of about $39,900 a year before tax.
Good to know
- Many cities and counties charge local occupational (income) taxes, which the state rate leaves out; the Tax Foundation puts the average at 0.93 % of AGI.
Sources
- US Department of Labor, State Minimum Wage Laws (updated July 1, 2026) (2026-07-01)
- Tax Foundation, State Individual Income Tax Rates and Brackets, 2026 (2026-02-19)
- Tax Foundation, State and Local Sales Tax Rates, Midyear 2026 (as of July 1, 2026) (2026-07-06)
- US Census Bureau, ACS 2024 1-year estimates, table B25064 Median Gross Rent (2025-09)