Kentucky employer payroll tax calculator 2026
Hiring in Kentucky? New Kentucky employers pay 2.7% state unemployment tax on the first $12,000 of each employee's wages, on top of the federal 6.2% Social Security, 1.45% Medicare and FUTA. For a $60,000 employee that's about $4,956 a year in employer payroll taxes — $324.00 of it to Kentucky.
| Wages | $60,000.00 |
| Employer Social Security | $3,720.00 |
| Employer Medicare | $870.00 |
| FUTA (0.6% on $7,000.00) | $42.00 |
| State unemployment insurance (SUI) (2.7% on $12,000.00) | $324.00 |
| Employer payroll taxes | $4,956.00 |
| Total cost before benefits | $64,956.00 |
Per two-week payroll: $2,498.31. Add health insurance, retirement and workers' compensation in the cost of an employee calculator.
Kentucky unemployment tax (SUTA) for new employers
Employers with less than three years of experience pay at least 2.7%; new construction employers get the highest rate on the schedule.
After a few years the state assigns your own rate based on your layoff history; enter it in the calculator once you have it. Your rate also earns the usual federal FUTA credit: pay Kentucky on time and FUTA is 0.6% on the first $7,000. If Kentucky ends up a credit-reduction state for the year (the Department of Labor lists them each November), FUTA is higher.
Other Kentucky payroll programs
- Many Kentucky cities and counties charge an occupational license tax, generally withheld from employees.
What an employee costs in Kentucky
| Salary | Federal employer taxes | Kentucky employer taxes | Total cost | Taxes as % of pay |
|---|---|---|---|---|
| $40,000 | $3,102.00 | $324.00 | $43,426.00 | 8.6% |
| $60,000 | $4,632.00 | $324.00 | $64,956.00 | 8.3% |
| $100,000 | $7,692.00 | $324.00 | $108,016.00 | 8.0% |
A year, before benefits. New-employer rates, 5 employees, full FUTA credit.
How much does a $40,000 employee cost in Kentucky?
About $43,426 a year: the $40,000 salary plus $3,102.00 of federal employer taxes and $324.00 of Kentucky employer taxes, before benefits. That's $1,670.23 per two-week payroll.
How much does a $60,000 employee cost in Kentucky?
About $64,956 a year: the $60,000 salary plus $4,632.00 of federal employer taxes and $324.00 of Kentucky employer taxes, before benefits. That's $2,498.31 per two-week payroll.
How much does a $100,000 employee cost in Kentucky?
About $108,016 a year: the $100,000 salary plus $7,692.00 of federal employer taxes and $324.00 of Kentucky employer taxes, before benefits. That's $4,154.46 per two-week payroll.
Both halves of one paycheck
On a $60,000 salary paid every two weeks, the employee sees $11,593 a year taken out of pay — federal income tax, their own Social Security and Medicare and Kentucky taxes — and takes home $48,408 (single filer, standard W-4). That money is withheld from their wages, not an extra cost to you. On top of the salary, you pay $4,956.00 of employer taxes. See the employee's side line by line in the Kentucky paycheck calculator.
More employer tools
Cost of an employee (benefits and cost per hour) · Employer payroll tax calculator (all states) · Employer payroll taxes guide
Kentucky figures checked 2026-09-28 against the state's own publications. Planning estimate, not a payroll return: your rate notice and the state's rules decide the final amount.
Sources
- Kentucky OUI — Employer guide to unemployment insurance (2026) — fewer than three years of experience: at least 2.7%; 2026 taxable wage base $12,000 (checked 2026-09-28)
- IRS Publication 15 (2026), Employer's Tax Guide — 2026 employer Social Security and Medicare rates and wage limits; FUTA
- IRS — FUTA credit reduction — 6.0% FUTA on the first $7,000; usual 5.4% credit; credit-reduction states lose part of the credit
- U.S. Department of Labor — FUTA credit reductions — the list of credit-reduction states for each year (checked 2026-09-28)
Questions
What is the Kentucky SUTA rate for new employers?
2.7% in 2026, on the first $12,000 of each employee's wages. Employers with less than three years of experience pay at least 2.7%; new construction employers get the highest rate on the schedule.
What is the Kentucky unemployment tax wage base for 2026?
$12,000 per employee per year.
How much does it cost to employ someone for $60,000 in Kentucky?
About $64,956 a year before benefits: $4,632.00 of federal employer taxes and $324.00 for Kentucky, at the new-employer rate with 5 employees.