Taxes in Covington, Kentucky
Complete tax guide for Covington, KY. State income tax up to 4%, 0.85% property tax, 6% sales tax. Calculate your total tax burden.
State Income Tax
4%
Kentucky
Property Tax
0.85%
Effective rate
Sales Tax
6%
Combined rate
Tax Burden
Low
Covington, KY Tax Overview
Occupational tax of 2.5%; Cincinnati metro area
Population
41,285
Median Income
$41,232
Cost of Living
88.1 (100 = avg)
State Income Tax
4%
Local Income Tax
2.5%
Median Home Price
$155,000
Covington Tax Calculator
Pre-filled with Covington median: $41,232
Total Tax Burden in Covington
$8,744
Take-Home: $32,488 · Effective Rate: 21.21%
Federal Tax
$2,909
7.06% eff.
KY State + Local
$2,680
6.50% eff.
FICA
$3,154
7.65% eff.
Take-Home
$32,488
78.79% kept
Tax Breakdown
| Item | Annual | Monthly |
|---|---|---|
| Gross Income | $41,232.00 | $3,436.00 |
| Federal Income Tax | -$2,909.34 | -$242.45 |
| Kentucky State Tax | -$1,649.28 | -$137.44 |
| Covington Local Tax (2.5%) | -$1,030.80 | -$85.90 |
| Social Security (6.2%) | -$2,556.38 | -$213.03 |
| Medicare (1.45%) | -$597.86 | -$49.82 |
| Take-Home Pay | $32,488.33 | $2,707.36 |
Property Tax in Covington
Median Home
$155,000
Annual Tax
$1,318
Monthly Tax
$110
Effective Rate
0.85%
Sales Tax in Covington
Combined Rate
6%
State Portion
~3.5%
Local Portion
~2.5%
The combined sales tax rate in Covington is 6%, which is below the national average of 7.12%. On a $100 purchase, you would pay $6.00 in sales tax.
Tax Burden Comparison
| Tax Type | Covington | Kentucky Avg | National Avg |
|---|---|---|---|
| Income Tax | 4% + 2.5% | 4% | 4.6% |
| Property Tax | 0.85% | ~0.85% | 1.1% |
| Sales Tax | 6% | ~6% | 7.12% |
| Overall Burden | Low | — | Moderate |
Tax Saving Tips for Covington Residents
- Kentucky's income tax rate of 4% is competitive. You may still benefit from maximizing 401(k) contributions ($23,500 limit) to reduce your taxable income at both state and federal levels.
- Covington has a local income tax of 2.5%. If you work remotely, verify whether you owe city tax based on where you work or where you live. Some cities only tax people who work within city limits.
- Property tax in Covington (0.85%) is below the national average of 1.1%. This makes homeownership more affordable here relative to property tax burden.
- Use a Health Savings Account (HSA) if eligible. Contributions are tax-deductible ($4,300 individual, $8,550 family), growth is tax-free, and withdrawals for medical expenses are tax-free.
Other Cities in Kentucky
Calculate Your Full Kentucky Tax Burden
See detailed state tax brackets, FICA breakdown, and compare to neighboring states.
Frequently Asked Questions
What are the tax rates in Covington, KY?
Covington, Kentucky has a state income tax rate up to 4%, plus a local income tax of 2.5%. The property tax rate is 0.85% and the combined sales tax rate is 6%. Occupational tax of 2.5%; Cincinnati metro area
How much is property tax in Covington?
The effective property tax rate in Covington is 0.85%. On the median home price of $155,000, this equals approximately $1,318 per year or $110 per month. This is below the national average of 1.1%.
What is the sales tax rate in Covington?
The combined sales tax rate in Covington is 6%, which includes both state and local components. This is below the national average combined rate of approximately 7.12%.
How does Covington's tax burden compare to other cities?
Covington has a low overall tax burden. The effective total tax rate for a median-income household is approximately 25.1%. The combination of 4% state income tax, 0.85% property tax, and 6% sales tax determines the total burden. Cost of living index is 88.1 (100 = national average).
Are there any local taxes in Covington?
Yes. Covington imposes a local income tax of 2.5% in addition to the state income tax of 4%. Occupational tax of 2.5%; Cincinnati metro area