Take-home pay compared · Tax year 2026
Kentucky vs Tennessee taxes
Kentucky's rate is low but its deduction is tiny, so the tax reaches nearly every dollar. Most Kentucky workers also pay a local occupational tax. Tennessee takes neither.
Kentucky
$2,272.51
take-home a paycheck · $59,085 a year
Effective tax rate 21.2%
Tennessee
$2,368.95
take-home a paycheck · $61,593 a year
Effective tax rate 17.9%
On $75,000, you keep $2,507 more a year in Tennessee than in Kentucky. That is $96.44 a paycheck, paid every two weeks.
| Deduction | Kentucky | Tennessee |
|---|---|---|
| Federal income tax | −$295.00 | −$295.00 |
| Social Security & Medicare | −$220.67 | −$220.67 |
| State income tax | −$96.44 | None |
| State payroll deductions | None | None |
| Total tax | −$612.11 | −$515.67 |
| Take-home | $2,272.51 | $2,368.95 |
Income and payroll taxes only, for wage income with no pre-tax deductions or dependents. Full working for each side: Kentucky paycheck calculator · Tennessee paycheck calculator.
Kentucky and Tennessee side by side, 2026
| Kentucky | Tennessee | |
|---|---|---|
| State income tax | 3.5% flat | None |
| Standard deduction (single) | $3,360 | — |
| Payroll deductions | None | None |
Take-home at every salary
| Salary | Kentucky | Tennessee | Difference | Keeps more |
|---|---|---|---|---|
| $30,000 | $25,353 | $26,285 | $932 | Tennessee |
| $40,000 | $33,038 | $34,320 | $1,282 | Tennessee |
| $50,000 | $40,723 | $42,355 | $1,632 | Tennessee |
| $60,000 | $48,408 | $50,390 | $1,982 | Tennessee |
| $75,000 | $59,085 | $61,593 | $2,507 | Tennessee |
| $100,000 | $75,798 | $79,180 | $3,382 | Tennessee |
| $125,000 | $92,446 | $96,704 | $4,257 | Tennessee |
| $150,000 | $108,659 | $113,791 | $5,132 | Tennessee |
| $200,000 | $142,045 | $148,927 | $6,882 | Tennessee |
| $250,000 | $174,550 | $183,182 | $8,632 | Tennessee |
| $500,000 | $323,094 | $340,477 | $17,382 | Tennessee |
| Salary | Kentucky | Tennessee | Difference | Keeps more |
|---|---|---|---|---|
| $60,000 | $50,588 | $52,570 | $1,982 | Tennessee |
| $80,000 | $65,958 | $68,640 | $2,682 | Tennessee |
| $100,000 | $81,328 | $84,710 | $3,382 | Tennessee |
| $150,000 | $118,053 | $123,185 | $5,132 | Tennessee |
| $200,000 | $152,439 | $159,321 | $6,882 | Tennessee |
| $250,000 | $188,836 | $197,468 | $8,632 | Tennessee |
| $300,000 | $223,911 | $234,293 | $10,382 | Tennessee |
| $400,000 | $294,061 | $307,943 | $13,882 | Tennessee |
| $500,000 | $359,071 | $376,453 | $17,382 | Tennessee |
Where the difference comes from
Neither state deducts a payroll levy, and Tennessee takes no income tax, so the state-level gap is Kentucky’s income tax and nothing else. Kentucky charges a flat 3.5% after a standard deduction of just $3,360, so almost all of a salary is taxed.
On $75,000 that comes to $2,507, and because nothing else on the two payslips differs, a single filer keeps exactly that much more in Tennessee. With a flat rate and a small deduction, the gap is close to 3.5% of whatever you earn: $1,632 on $50,000, $5,132 on $150,000 and $8,632 on $250,000.
The occupational tax, which the Kentucky figure leaves out
Most Kentucky counties and cities levy an occupational license tax on wages. Louisville is around 2.2% and Lexington around 2.25%. It is charged where you work, not where you live. There is no single statewide figure, so it is not in the Kentucky column above.
On $75,000 a rate like Louisville’s or Lexington’s adds roughly $1,650 to $1,688 to the Kentucky side. For someone working in Louisville or Lexington, the true gap with Tennessee is therefore well above the figure the calculator shows. Tennessee has no local income tax anywhere.
Couples keep even more in Tennessee
Kentucky gives a couple filing jointly the same $3,360 deduction as a single person. So a couple on $150,000 pays $5,132, which is $117.60 more than two single people on $75,000 each. That is why many Kentucky couples file separately at state level, where each spouse gets a deduction. On a joint return the couple keeps $5,132 more in Tennessee.
Living on one side, working on the other
The two states share a long border, and the tax follows the work more than the home.
- Live in Tennessee, work in Kentucky. Kentucky taxes nonresidents on income from services performed in Kentucky. Its reciprocal agreements, which let a commuter pay only their home state, cover seven states, and Tennessee is not one of them, according to the Department of Revenue’s instructions for Form 740-NP. A Tennessee resident with a Kentucky job pays Kentucky income tax on those wages, and the local occupational tax where the job is.
- Live in Kentucky, work in Tennessee. Kentucky residents report all their income, including income from outside Kentucky. With no Tennessee income tax on the wages, there is no credit to claim against it, so the Kentucky figure applies in full. The occupational tax, charged where you work, does not.
Living in Tennessee pays off, in income tax terms, when you also work there.
What the take-home figure does not count
Tennessee collects its revenue through sales tax instead, and taxes groceries at a reduced rate rather than exempting them. Kentucky exempts Social Security and a set amount of pension income per person, which narrows the gap for retirees; this page models wages only. Property tax and housing costs are not in these figures.
Questions people ask
- Do you take home more in Kentucky or Tennessee on $75,000?
- Tennessee, by $2,507 a year, or $209 a month, for a single filer in 2026. That counts federal tax, Social Security, Medicare, state income tax and every state payroll deduction.
- Is the difference the same at every salary?
- No, but the same side stays ahead. The gap is $932 a year at $30,000 and $8,632 at $250,000, for a single filer.
- I live in Tennessee and work in Kentucky. Do I pay Kentucky tax?
- Yes, on the wages for work done in Kentucky. Kentucky's reciprocal agreements cover Illinois, Indiana, Michigan, Ohio, Virginia, West Virginia and Wisconsin, not Tennessee, so a Tennessee resident with a Kentucky job files a nonresident return, Form 740-NP. A local occupational tax where the job is can apply as well.
- Why does Kentucky take more from a married couple?
- Kentucky's standard deduction is not doubled for a joint return: a couple filing jointly gets the same deduction as one single person. It is doubled for married filing separately, which is why many Kentucky couples file separate state returns. Tennessee has no return to file at all.
- Has Kentucky been cutting its rate?
- Yes. It fell from 4% to 3.5% on January 1, 2026. Kentucky's cuts come from revenue triggers adopted in 2022, and each step also has to be approved by the legislature, so there is no fixed schedule. Tennessee's constitution has prohibited a tax on earned income since 2014.
What this comparison covers
Income tax and payroll deductions on wages: federal income tax, Social Security, Medicare, state income tax, every state payroll deduction. It does not compare sales tax, property tax, housing or the cost of living, which can outweigh the difference in take-home pay. Figures assume the standard deduction, no dependents and no pre-tax retirement contributions. See how we calculate.
Where the Kentucky figures come from
Every Kentucky number on this page was read from the documents below — the state's own, not a summary of them. Nothing here is estimated. If a figure looks wrong, the source is one click away, and we would rather you checked.
- Individual Income Taxrevenue.ky.gov
The flat rate for 2026 and the standard deduction, which is NOT doubled for a couple filing jointly.
- Claimant Guide: Your Rights & Responsibilities When Claiming Unemployment Insurance Benefitskcc.ky.gov
That workers do not pay into unemployment insurance: it comes from employer taxes and is never deducted from a paycheck.
Where the Tennessee figures come from
Every Tennessee number on this page was read from the documents below — the state's own, not a summary of them. Nothing here is estimated. If a figure looks wrong, the source is one click away, and we would rather you checked.
- Tennessee Department of Revenuetn.gov
The taxes Tennessee levies following the repeal of the Hall income tax — none of them falls on wages.
- How do I determine if my employment qualifies as covered employment?lwdsupport.tn.gov
That the unemployment tax premium on a worker's wages is paid by the employer.