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Taxes
Kentucky Payroll Taxes 2026: Complete Overview for Employers
Kentucky flat 4% income tax, SUI on the first $11,100, and all employer tax obligations explained.
Practical guides on KY payroll taxes, employer registration, SUI, minimum wage, and labor laws — written for small business owners, not accountants.
Written by payroll professionals at Pacific Data Services — trusted since 1969.
Kentucky’s flat 4% income tax rate simplifies withholding calculations for employers across the state.
Many Kentucky cities and counties levy their own occupational license taxes on wages, adding complexity to payroll processing.
Kentucky requires employers to pay at least semi-monthly, with final wages due by the next payday or within 14 days of separation.
Kentucky flat 4% income tax, SUI on the first $11,100, and all employer tax obligations explained.
Get your EIN, register with Kentucky, set up withholding, new hire reporting — the complete checklist.
New employer rate 2.7%, experienced range 0.30%–9.00%, wage base $11,100.
Kentucky minimum wage $7.25/hr. Kentucky’s minimum wage is $7.25/hr, matching the federal rate. Tipped employees may be paid $2.13/hr.
IRS classification rules, Kentucky-specific considerations, misclassification penalties.
Gusto vs Paychex vs QuickBooks vs ADP — detailed comparison for Kentucky small businesses.