Kentucky income tax cut reshapes filing season for Perry County taxpayers

Kentucky's individual income tax rate dropped to 3.5% as of Jan. 1, 2026, a change that will alter withholding, refund balances and planning for taxpayers across Perry County. The reduction changes the arithmetic on state filings for the 2025 tax year and means paychecks and year-end returns may look different than residents expect.

A recent tax-season briefing outlined the main items Perry County filers need to know heading into the 2026 filing season. In practical terms, employees should check pay stubs for updated withholding and consult payroll offices if state withholding does not reflect the new rate. Taxpayers who had marginal liabilities under prior brackets should expect some refunds to shrink or amounts owed to change; those with complex returns should confirm calculations with a preparer or free assistance program.

The briefing also highlighted changes to federal and state deductions and credits that affect 2025 filers. Mountain-area households should gather documentation now: W-2s, 1099s, records of federal and state withholding, and paperwork for any recovery or disaster-relief payments received last year. For Perry County residents displaced or affected by recent floods, the guidance emphasized retaining proof of damage, evacuation orders, FEMA or other assistance letters, and any receipts tied to repairs or temporary housing to support disaster-related claims.

Local access to reliable, low-cost tax help remains critical. Volunteer Income Tax Assistance (VITA)-style programs, county extension offices and community non-profits can provide free or low-cost preparation for eligible households. Residents who need detailed, one-on-one support should contact the Perry County clerk's office, local extension services or community organizations offering tax assistance well before filing deadlines. Be cautious of commercial refund-advance products and aggressive preparers; those options can carry high fees and predatory terms that erode modest refunds.

Policy implications extend beyond individual returns. A lower individual rate reduces state collections unless offset by other changes, which has implications for budgets and services funded at the state level. Tax policy remains a salient issue for voters and local civic engagement; understanding how changes affect household budgets will shape conversations at the ballot box and in county meetings.

For Perry County taxpayers, the immediate takeaway is practical: check withholding now, assemble documentation for 2025 income and any disaster aid, and seek VITA-style assistance if eligible. With filing season under way, accurate records and timely contact with local tax-assistance offices will help residents navigate changes and protect modest household finances as the county continues to recover from recent weather-related impacts.