KY · #26 by population

Buying a home in Kentucky

Costs and rules that are specific to Kentucky. Main city: Louisville.

In short

Kentucky taxes property sales through its real estate transfer tax, requires an attorney for part of the closing and requires a seller disclosure form. It forecloses through the courts and lets couples opt in to community property.

Calculate for Kentucky

If you buy

Kentucky state transfer tax

Real estate transfer tax (KRS 142.050): $0.50 for each $500 of value, or fraction of $500. Change the price: the amount is recalculated instantly.

Price$226,000
State transfer tax$226
Share of the price0.1% of the price
Who paysThe seller

Default price: the Kentucky median value of owner-occupied homes, $226,000 (Census ACS 2024). Rule: Divide the value by $500, round up to the next whole unit, multiply by $0.50. In a sale, value is the full actual consideration including liens; in a gift it is the estimated open-market price. No minimum or maximum is stated. Who pays: KRS 142.050 imposes the tax on the grantor named in the deed. The sources do not say whether a contract can shift it to the buyer. Not included: county and city transfer taxes, recording fees, title insurance and lender charges. Kentucky transfer tax guide · all 50 states.

If you sell

Capital gain and the federal tax on it

Same federal rule in every state: Section 121 of the Internal Revenue Code excludes up to $250,000 of gain on a main home ($500,000 for a married couple filing jointly).

Capital gain$350,000
Section 121 exclusion$250,000 (limit $250,000)
Taxable gain$100,000
Type of gainLong-term (owned over 1 year), 15% chosen
Federal tax on the gain$15,000

Section 121 excludes $250,000; the rest is taxable.

Gain = sale price minus your adjusted basis (purchase price, buying costs and improvements); selling expenses reduce it (IRS Publication 523). Long-term rates for sales in 2026, by taxable income including the gain (IRS Rev. Proc. 2025-32, section 4.03): 0% up to $49,450 single or $98,900 married filing jointly, 15% up to $545,500 single or $613,700 jointly, 20% above. Not included: Kentucky state income tax on the gain (not computed), the net investment income tax, depreciation recapture on a rental or home office, and the reduced exclusion for an early sale. Agent commissions are negotiated and never set by law. Capital gains on a home sale.

Kentucky in short

Is there a real estate transfer tax in Kentucky?

Kentucky charges a real estate transfer tax of $0.50 for each $500 of value or fraction of $500, which is $242 on a $241,700 sale. The statute puts it on the grantor named in the deed, the seller, and the county clerk collects it before recording.

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How much is the state transfer tax on a $226,000 home in Kentucky?

On $226,000, the median value of owner-occupied homes in Kentucky (Census ACS 2024), the state real estate transfer tax comes to $226 ($0.50 for each $500 of value, or fraction of $500). County and city taxes are not included.

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What closing costs does Kentucky law set?

Kentucky has no official typical closing-cost total. The seller pays a transfer tax of $0.50 per $500 of value ($242 on a $241,700 sale) and recording a deed costs $33 for up to five pages plus a $4 state tax.

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How is property tax calculated in Kentucky?

Kentucky taxes real estate at fair cash value set by the county Property Valuation Administrator. The state rate is 10.3 cents per $100 for 2026, and Louisville's Urban Services District total for 2025 is $1.260 per $100.

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What is the deadline to appeal a property tax assessment in Kentucky?

In Kentucky, request a conference with the county Property Valuation Administrator first (required under KRS 133.120), then appeal to the local board of assessment appeals by filing with the county clerk no later than one workday after the inspection period ends.

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Do you need a real estate attorney to close in Kentucky?

No Kentucky statute or court rule read requires an attorney to attend a home closing, but a non-lawyer drafting a deed for another person is the practice of law (KBA U-63) and every recorded deed must show who prepared it (KRS 382.335).

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What must a home seller disclose in Kentucky?

Kentucky requires a written seller's disclosure on single-family homes when a licensed agent is paid in the sale (KRS 324.360). The seller completes KREC Form 402, and the listing agent must give the buyer a copy within 72 hours of receiving a signed offer.

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How does foreclosure work in Kentucky?

Kentucky is a judicial foreclosure state: the lender sues in circuit court and the property is sold under a court order, and federal rules bar the process before a loan is 120 days behind.

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What first-time home buyer programs does Kentucky offer?

In Kentucky, Kentucky Housing Corporation (KHC) offers a down payment loan of up to $12,500, repaid over 15 years, with its mortgages.

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Is Kentucky a community property state?

Kentucky is not a community property state. Since July 15, 2020, married couples may choose community property by putting assets in a Kentucky community property trust (KRS 386.620 to 386.624).

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How much tax when you sell a home in Kentucky?

The federal rule is the same in Kentucky as in every state: if you owned and lived in the home as your main home for at least 2 of the last 5 years, the first $250,000 of gain is excluded, $500,000 for a married couple filing jointly (Section 121, IRS Publication 523). Bought $400,000, sold $750,000: a single owner has $100,000 of taxable gain, $15,000 of federal tax at the 15% long-term rate; a couple filing jointly owes nothing. Kentucky income tax on the gain is not computed here.

Capital gains on a home sale

Kentucky guides

Louisville

Buying a home in Louisville, Kentucky

Professionals in Kentucky

All states · Federal guides