Kentucky Capital Gains Tax Calculator
Calculate your 2026 capital gains tax in Kentucky. Kentucky taxes capital gains at rates up to 3.5%, plus federal taxes.
Original purchase price
Renovations, additions — added to your basis
Agent commissions, closing costs, title & transfer fees
Total Tax
$40,800
20.4% effective rate
Capital Gain
$200,000
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Tax Breakdown
Sale price minus selling costs and all taxes (before any mortgage payoff).
Federal
$33,800
KY State
$7,000
Effective Rate
20.4%
Kentucky Capital Gains Tax
Kentucky taxes capital gains at its flat 3.5% income tax rate, down from 4% in 2025. Further cuts depend on budget conditions and need approval by the General Assembly; current law keeps 3.5% for 2027.
Long-term: 3.5% flat rate
Short-term: 3.5% flat rate
NIIT Applied
The 3.8% Net Investment Income Tax applies because your income exceeds $200,000.
Kentucky Capital Gains Tax Details
Tax Treatment
Tax Type
Flat tax rate
Maximum Rate
3.5%
Available Exemptions
- Federal home-sale exclusion ($250K single / $500K married filing jointly) flows through to the Kentucky return
- Selling costs and capital improvements reduce the taxable gain
Kentucky Capital Gains Tax FAQ
Official References
- IRS Topic 409: Capital Gains and Losses
Federal capital gains tax guidance
- IRS Publication 523: Selling Your Home
$250K / $500K home-sale exclusion, basis adjustments, and selling expenses
- KRS 141.020 — Kentucky Individual Income Tax Rate
Kentucky state capital gains rules
This calculator provides estimates. Consult a tax professional for advice specific to your situation in Kentucky.
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