Kentucky City (Local) Income Tax Withholding
Reference Number: NFC-23-1678732928
Published: March 3, 2023
Effective: Pay Period 02, 2023
Summary
The city income tax withholding for Covington and Florence, Kentucky, includes the following changes:
- Covington maximum withholding wage base will increase from $147,000.00 to $160,200.00 and the maximum annual withholding from $3,601.50 to $3,924.90.
- Florence maximum withholding wage base will increase from $147,000.00 to $160,200.00 and the maximum annual withholding from $2,940.00 to $3,204.00.
The following city tax rates for Covington and Florence, Kentucky, remain the same:
- The employee tax rate for Covington remains at 2.45 percent.
- The employee tax rate for Florence remains at 2.00 percent.
No action on the part of the employee or the personnel office is necessary.
Tax Formula
|
City Name |
State/City Codes |
City Tax Status |
| Bowling Green | 21/0350 | Duty Station/mandatory |
| Covington | 21/0800 | Duty Station/mandatory |
| Florence | 21/1150 | Duty Station/mandatory |
| Frankfort | 21/1220 | Duty Station/mandatory |
| Lexington-Fayette | 21/1980 | Duty Station/mandatory |
| Louisville | 21/2090 | Duty Station/mandatory |
| Owensboro | 21/2490 | Duty Station/mandatory |
| Paducah | 21/2520 | Voluntary |
| Richmond | 21/2750 | Duty Station/mandatory |
Withholding Formula (Effective Pay Period 02, 2023)
- Multiply the gross biweekly wages by the number of pay dates in the tax year to obtain the annual wages.
- To determine the annual Kentucky city income tax withholding, multiply the gross annual wages by the appropriate city income tax percentage in the table below.
|
City |
State/City Codes |
Resident Percentage |
Nonresident Percentage |
City Tax Status (Duty Station = DS Residence = R) |
| Bowling Green | 21/0350 | 1.85 | 1.85 | DS |
| Covington | 21/0800 | 2.45¹ | 2.45¹ | DS |
| Florence | 21/1150 | 2.00² | 2.00² | DS |
| Frankfort | 21/1220 | 1.95 | 1.95 | DS, R |
| Lexington-Fayette | 21/1980 | 2.25 | 2.25 | DS |
| Louisville | 21/2090 | 1.45 | 1.45 | DS |
| Owensboro | 21/2490 | 1.78 | 1.78 | DS |
| Paducah (voluntary) | 21/2520 | 2.00 | 2.00 | N/A |
| Richmond | 21/2750 | 2.00 | 2.00 | DS |
¹ Maximum withholding wage base of $160,200 (maximum annual withholding of $3,924.90).
² Maximum withholding wage base of $160,200 (maximum annual withholding of $3,204.00).
Note: City tax is mandatory unless otherwise indicated.
- Divide the annual Kentucky city income tax withholding calculated in step 2 by the number of pay dates in the tax year to obtain the biweekly Kentucky city income tax withholding.
Resources
To view the updated tax formula, go to the HR and Payroll Clients page from the MyNFC drop-down menu on the National Finance Center (NFC) Home page. Select the Publications tab and select U.S. Income Tax Formulas from the Publications menu to launch the tax map. Select the desired State from the map provided for the formula.
Inquiries
For questions about NFC processing, authorized Servicing Personnel Office representatives should contact the NFC Contact Center at 1-855-NFC-4GOV (1-855-632-4468) or via the customer service portal at ServiceNow Portal for Federated Users and at ServiceNow Portal for Non-Federated Users.