Live in Illinois, work in Kentucky
Reciprocity agreement: you pay income tax only to your home state. Give your employer the work state's exemption form so it withholds for your home state instead.
State income tax: $4,805 a year
Living in Illinois and working in Kentucky, you'd pay about $4,805 in state income tax on $100,000 of wages.
Reciprocity agreement: you pay income tax only to your home state. Give your employer the work state's exemption form so it withholds for your home state instead.
State tax at different salaries
| Wages | To KY | To IL | Total | If you worked in IL |
|---|---|---|---|---|
| $50,000 | $0 | $2,330 | $2,330 | $2,330 |
| $75,000 | $0 | $3,568 | $3,568 | $3,568 |
| $100,000 | $0 | $4,805 | $4,805 | $4,805 |
| $150,000 | $0 | $7,280 | $7,280 | $7,280 |
| $250,000 | $0 | $12,230 | $12,230 | $12,230 |
Single filer, all wages earned in Kentucky, 2026 state tax rules, standard deductions. Local income taxes not included.
What to do
- Reciprocity: IL residents working in KY exempt from KY tax on wages; file Form 42A809 (Certificate of Nonresidence). KY local occupational license taxes still apply.
- Keep a record of the days you work in each state, especially if you sometimes work from home.
Local income taxes
- Kentucky: City/county occupational license taxes are levied by work location on residents and nonresidents alike (e.g., Louisville Metro ~2.2% combined, Lexington 2.25%), and are NOT covered by KY's state reciprocity agreements - OH/IN commuters into Louisville/Covington still pay them.
Frequently asked questions
Do I pay Kentucky income tax if I live in Illinois?
No. Under the reciprocity agreement you pay only Illinois. IL residents working in KY exempt from KY tax on wages; file Form 42A809 (Certificate of Nonresidence). KY local occupational license taxes still apply.
Do I have to file taxes in both Illinois and Kentucky?
Usually you file only one state return (a resident return in Illinois), though some states still require a nonresident return to get a refund of any wrongly withheld tax.
Will I be taxed twice?
No. Under the reciprocity agreement only Illinois taxes your wages: about $4,805 on $100,000.
Related
- Live in Kentucky, work in Illinois
- Moving from Illinois to Kentucky
- Moving from Kentucky to Illinois
- Live in Illinois, work in Iowa
- Live in Illinois, work in Indiana
- Live in Illinois, work in Missouri
- Live in Illinois, work in Wisconsin
Rules reviewed 2026-09-24 from state revenue departments and the Tax Foundation. Estimates only; confirm with each state's revenue department.