Kentucky car sales tax: 6% and what it applies to

• Kentucky charges 6%, and that rate is the same everywhere in the state — no county or city adds to it on a vehicle purchase.

• Taxed on top of the vehicle price: the dealer doc fee and dealer-installed accessories.
• Not part of the taxable amount: extended warranties and service contracts.
• Your trade-in comes off before tax is calculated.

• Kentucky has no sales tax on a car. It charges a 6% motor vehicle usage tax on the retail price, the same rate everywhere in the state. You pay it to your county clerk when you title the car, not to the dealer, and the tax is never less than $6.
• Your trade-in reduces the taxable amount on a new or a used car, with no dollar cap. The trade-in has to be a motor vehicle registered to you; a boat or other non-vehicle does not count.
• A rebate applied at the time of purchase is not taxed, whether it comes from the manufacturer or the dealer, and neither is a dealer discount.
• Kentucky does not cap the doc fee, so it is negotiable. The calculator taxes it, because the Department of Revenue treats a documentation or processing fee as part of the sale. The Department has not said so for the usage tax specifically.
• Extended warranties and service contracts are not taxed. Equipment and accessories the dealer adds to the car are.
• Registering the car: you apply for title and registration at your county clerk within 15 days. A dealer can file for you if you agree, and if it files through the state's electronic system it must collect the system's filing fee from you as a separate line labeled "online system filing fee." The dealer's 60-day temporary tag covers you meanwhile. The title and registration amounts are in the calculator's total because you pay them either way.
• If you buy from a dealer outside Kentucky and register here, Kentucky credits the tax you paid that state against the 6% usage tax, unless that state gives no similar credit to tax paid in Kentucky.

Source: Kentucky Department of Revenue — Motor Vehicle Usage Tax (KRS 138.460) · rules last verified Oct 11, 2026. Methodology.