1Indiana
Lowest20.8%
Overall effective tax rate
- Net
- Federal
- State
- FICA
- Federal income tax
- $7,670
- State income tax
- $2,183
- Payroll tax (FICA)
- $5,738
- Total tax
- $15,591
- Net income (annual)
- $59,410
Tax year 2026 · state vs state
Indiana vs Kentucky Income Tax Comparison (2026)
On a $75,000 salary (single filer, 2026), you pay $324 less state income tax a year in Indiana than in Kentucky, which is about $27 a month. At $150,000 the gap is $737 in favor of Indiana.
Indiana: 2.95% flatKentucky: 3.5% flatUpdated October 10, 2026
Compare Indiana and Kentucky for your income
Estimate for education only, not tax advice. 2026 federal and state rules, standard deductions, no local taxes. How we calculate.
State comparison
Comparing 2 states, sorted by lowest overall tax rate.
2Kentucky
21.2%
Overall effective tax rate
- Net
- Federal
- State
- FICA
- Federal income tax
- $7,670
- State income tax
- $2,507
- Payroll tax (FICA)
- $5,738
- Total tax
- $15,915
- Net income (annual)
- $59,085
Advanced analysis (optional)
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💰 Monthly breakdown
Your take-home pay, spread across the year
Indiana
Monthly gross$6,250
Monthly tax$1,299
Monthly take-home$4,951
Kentucky
Monthly gross$6,250
Monthly tax$1,326
Monthly take-home$4,924
Estimates use 2026 federal and state rates, the standard deduction for your filing status and no local taxes. Rankings use state income tax only.
Indiana vs Kentucky: how the two systems differ
| Indiana | Kentucky | |
|---|---|---|
| Wage income tax | Flat 2.95% | Flat 3.5% |
| Top rate | 2.95% | 3.5% |
| Lowest rate | 2.95% | 3.5% |
| Deductions and credits (single) | $1,000 personal exemption | $3,360 standard deduction |
State income tax and take-home pay at every salary
The same salary can leave you with different take-home pay depending on the state. This table applies each state’s 2026 rules to a single filer with no pre-tax contributions.
| Income | IN state tax | KY state tax | Difference | IN take-home | KY take-home |
|---|---|---|---|---|---|
| $30,000 | $856 | $932 | $77 less in Indiana | $25,430 | $25,353 |
| $40,000 | $1,151 | $1,282 | $132 less in Indiana | $33,170 | $33,038 |
| $50,000 | $1,446 | $1,632 | $187 less in Indiana | $40,910 | $40,723 |
| $60,000 | $1,741 | $1,982 | $242 less in Indiana | $48,650 | $48,408 |
| $75,000 | $2,183 | $2,507 | $324 less in Indiana | $59,410 | $59,085 |
| $100,000 | $2,921 | $3,382 | $462 less in Indiana | $76,260 | $75,798 |
| $150,000 | $4,396 | $5,132 | $737 less in Indiana | $109,396 | $108,659 |
| $250,000 | $7,346 | $8,632 | $1,287 less in Indiana | $175,837 | $174,550 |
Single filer, 2026, federal standard deduction. Take-home is after federal, state and payroll tax. No local taxes.
Married filing jointly
| Income | IN state tax | KY state tax | Difference | IN take-home | KY take-home |
|---|---|---|---|---|---|
| $75,000 | $2,154 | $2,507 | $354 less in Indiana | $62,469 | $62,115 |
| $100,000 | $2,891 | $3,382 | $491 less in Indiana | $81,819 | $81,328 |
| $150,000 | $4,366 | $5,132 | $766 less in Indiana | $118,819 | $118,053 |
| $250,000 | $7,316 | $8,632 | $1,316 less in Indiana | $190,152 | $188,836 |
Married filing jointly, 2026, federal standard deduction. Uses each state's joint brackets where they differ.
Does the lower-tax state change as income rises?
For a single filer, Kentucky is the lower-tax state up to roughly $17,500 of income, and Indiana becomes the lower-tax state above that.
Rates side by side
Indiana (single filers)
| 2.95% | Over $0 |
Kentucky (single filers)
| 3.5% | Over $0 |
- Indiana: Indiana counties also levy a local income tax, typically between 0.5% and 3%, which is not included here.
- Kentucky: Many Kentucky cities and counties also levy local occupational license taxes that are not included here.
Full details for each state: Indiana income tax calculator and Kentucky income tax calculator. Federal rates are on the 2026 federal tax brackets page.
Indiana vs Kentucky FAQ
Which has lower income tax, Indiana or Kentucky?+
Indiana is lower at $75,000: $2,183 of state income tax versus $2,507 in Kentucky. At $150,000 it is $4,396 in Indiana and $5,132 in Kentucky. For a single filer, Kentucky is the lower-tax state up to roughly $17,500 of income, and Indiana becomes the lower-tax state above that.
How much more do I keep on $100,000 in Indiana versus Kentucky?+
A single filer keeping $76,260 a year in Indiana would keep $75,798 in Kentucky after federal, state and payroll tax. The difference is $462 a year, or $38 a month.
How do the Indiana and Kentucky income tax systems differ?+
Indiana uses a flat 2.95% rate; Kentucky uses a flat 3.5% rate. State deductions and exemptions also differ, which changes how much income is taxed.
Are local taxes included in this Indiana vs Kentucky comparison?+
No. It covers federal income tax, Social Security, Medicare and state income tax only. City, county, sales and property taxes are not included, and they can change the real cost of living in each state.
Should I move from Indiana to Kentucky to save on taxes?+
State income tax is one cost among many. Property and sales taxes, housing, insurance and wages also differ, and you may owe tax to both states in the year you move. Use this comparison as one input and confirm details with a tax professional.
Sources
- Tax Foundation: 2026 state individual income tax rates and brackets
- IRS: Tax inflation adjustments for tax year 2026
Last checked October 10, 2026. Confirm with your state tax agency before filing.
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Estimates for education only, not tax, legal or financial advice. Not a substitute for a tax professional or your state revenue department.