What payroll taxes does a Kentucky employer pay?

A Kentucky employer pays the employer half of FICA (6.2% Social Security plus 1.45% Medicare), federal FUTA (effectively 0.6% on the first $7,000 of wages), and Kentucky State Unemployment Insurance (SUI) on the state wage base. Kentucky does not have an employer-paid SDI or PFML program.

What is the Kentucky SUI new-employer rate?

For 2024 the standard new-employer SUI rate in Kentucky is about 2.7% on the first $11,400 of each employee's wages (the 2024 taxable wage base). After you build an experience history, your rate is reassigned annually and can be higher or lower.

What is the FUTA rate for Kentucky employers?

The federal FUTA tax is 6.0% on the first $7,000 of each employee's wages, but employers who pay state unemployment tax on time get a 5.4% credit, leaving an effective FUTA rate of 0.6% — a maximum of $42 per employee per year.

Does Kentucky have an employer disability or paid-leave tax?

No. Unlike states such as California or New York, Kentucky does not levy an employer-paid State Disability Insurance (SDI) or Paid Family and Medical Leave (PFML) payroll tax. Your only state payroll tax is SUI.

Does the employer withhold Kentucky income tax too?

Yes, but withholding is the employee's money, not an employer tax. The employer must withhold Kentucky's flat 4.0% income tax (plus any local occupational tax) from wages and remit it, but that comes out of the employee's pay rather than being an added employer cost.

Kentucky Employer Payroll Tax Calculator

Email me this result

Get this tool's output sent to your inbox, plus one useful tool a week. No spam, unsubscribe any time.

A Kentucky employer’s true payroll cost is more than the wage itself: you also owe the employer half of FICA, federal FUTA, and Kentucky State Unemployment Insurance. This calculator adds those three employer-side taxes for one employee so you can see your fully-loaded labor cost.

How it works

Three employer-paid taxes apply, each on its own wage base:

employer FICA = wage × 6.2% (SS, capped at $168,600) + wage × 1.45% (Medicare)
FUTA          = min(wage, $7,000) × 0.6%   (after the 5.4% state credit)
KY SUI        = min(wage, $11,400) × SUI rate (default 2.7% new-employer)
total         = employer FICA + FUTA + KY SUI

Social Security is capped at the 2024 wage base of 168,600 dollars; Medicare has no cap. FUTA’s effective rate is 0.6 percent because timely state-unemployment payers receive a 5.4 percent credit against the headline 6.0 percent. Kentucky’s SUI applies to the first 11,400 dollars of wages at your assigned rate. Kentucky has no employer SDI or PFML tax.

Example

For an employee earning 50,000 dollars: employer FICA is 50,000 × 0.0765 = 3,825 dollars; FUTA is 7,000 × 0.006 = 42 dollars; Kentucky SUI at 2.7 percent is 11,400 × 0.027 = about 308 dollars. The total employer payroll tax is roughly 4,175 dollars on top of the 50,000 dollar wage.

Notes

Estimate only, not tax advice. The Kentucky SUI new-employer rate and wage base update annually, and your experience-rated SUI rate may differ — enter it manually for accuracy. Income-tax withholding (Kentucky’s flat 4.0% plus any local occupational tax) is the employee’s money, not an employer tax, so it is not added here. Confirm rates with the Kentucky Office of Unemployment Insurance and revenue.ky.gov.