Kentucky tax forms & filing.

Things to know about filing in Kentucky

• Kentucky counties and cities levy local occupational taxes that are withheld from wages by employers. These are separate from the state return — they're a year-round payroll tax, not a tax-return item — but you should reconcile that the W-2 withholding matches your county/city of work.
• Kentucky has reciprocity with Illinois, Indiana, Michigan, Ohio, Virginia, West Virginia, and Wisconsin. Residents working in those states pay only Kentucky tax on wages.
• Kentucky excludes Social Security benefits from state tax and exempts a portion of qualified pension income — calculated on the Form 740 schedule for retirees.

Kentucky local occupational taxes — wage-based, withheld by employer

Kentucky counties and cities levy local occupational taxes on wages and self-employment income — typically 0.5% to 2.5% depending on the jurisdiction. These taxes are withheld from wages by employers and remitted to the local tax collector. They're a year-round payroll item, not a tax-return adjustment.

Reconcile the W-2 to verify the local occupational tax was withheld for your actual work location, not your residence. Some employers default to your home-county rate, which may differ from the work-county rate. Cross-county commuters need to confirm the withholding matches the work location.

Local occupational taxes are NOT income tax in the traditional sense — they're employer-withheld payroll taxes. They don't appear on the state Form 740, but they DO appear on the W-2 in Box 19 (local income tax withheld).

Kentucky reciprocity network — one of the broadest in the country

Kentucky has wage-income reciprocity with seven states: Illinois, Indiana, Michigan, Ohio, Virginia, West Virginia, and Wisconsin. Kentucky residents working in any of those states (or residents of those states working in Kentucky) pay only their resident-state tax on wages — no nonresident return required.

Important caveat (same as Indiana): Kentucky reciprocity does NOT cover local occupational taxes. If you live in Kentucky and work in Ohio, you owe Kentucky state tax on the wages (per reciprocity) AND Ohio city income tax in the work city (Ohio's city tax is separate from state reciprocity).

Non-wage income (K-1, rental, 1099) is also outside reciprocity. Cross-state rental income or partnership distributions still require a nonresident return in the source state.

Where's my refund?

The Kentucky Department of Revenue runs the official refund-status tracker. You'll need your Social Security number, filing status, and exact refund amount (in some cases, the tax year and a return-amount input).

Check your Kentucky refund status →

Multi-state considerations

If you lived or worked in more than one state during the tax year, you typically file a part-year resident return in each state. If you live in one state and work in another, you usually file as a resident where you live and as a nonresident in the work state — claiming a credit on the resident return for taxes paid to the work state. Reciprocity agreements between some neighboring states change this default; we map this out at intake.

Kentucky-specific multi-state nuances are addressed in the quirks list above when they apply.

Get the current-year forms

State tax rates, brackets, and forms change every year. We point to the Kentucky Department of Revenue as the authoritative source for current-year information. Form numbers above are stable; rates, deduction amounts, and credit limits are not — always verify before relying on a specific dollar amount.

Open the Kentucky Department of Revenue website →