Kentucky vs. Tennessee
On a $75,000 salary, you keep about $2,507 more a year in Tennessee. Prices are 2% higher in Tennessee, so after adjusting for cost of living Tennessee comes out ahead.
Last verified November 2, 2026.
| Kentucky | Tennessee | |
|---|---|---|
| State income tax | Has a flat income tax of 3.5% on taxable income. | Does not tax wages, so there is no state income tax withheld from paychecks. |
| Minimum wage | $7.25 | $7.25 |
| Price level (U.S. = 100) | 90.2 | 91.9 |
| Employer cost on a $50,000 hire | $4,571 | $4,456 |
| SUTA wage base | $12,000 | $7,000 |
Take-home pay at the same salary
| Salary | Kentucky take-home | Tennessee take-home | Difference |
|---|---|---|---|
| $50,000 | $40,723 | $42,355 | $1,632 more in Tennessee |
| $75,000 | $59,085 | $61,593 | $2,507 more in Tennessee |
| $100,000 | $75,798 | $79,180 | $3,382 more in Tennessee |
| $150,000 | $108,659 | $113,791 | $5,132 more in Tennessee |
Single filer, standard deduction, tax year 2026. Excludes local income taxes.
Adjusted for cost of living
Using BEA regional price parities, $59,085 in Kentucky buys what $65,534 buys in an average-priced state, and $61,593 in Tennessee buys what $67,043 does. To keep the same buying power moving from Kentucky to Tennessee, a $75,000 salary would need to be about $76,423 before the tax difference.
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Frequently asked questions
- Is Kentucky or Tennessee better for take-home pay?
- On $75,000, you keep about $2,507 more a year in Tennessee. Adjusted for prices, Tennessee comes out ahead by $1,509.
- Which state is cheaper for employers, Kentucky or Tennessee?
- Employer taxes and insurance on a $50,000 hire are about $4,571 in Kentucky and $4,456 in Tennessee.