2021 Research Brief: County Property Taxes

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Property taxes are a form of an ad valorem tax, meaning the tax is based on assessed monetary value. Counties levy property taxes on real property, such as land and buildings, and tangible personal property, such as automobiles. This brief will focus on property taxes on real estate imposed by fiscal courts.¹

• All 120 counties levy property taxes on real estate.
• Rates range from 3.2 cents/$100 of assessed value to 47.0 cents/$100 of assessed value, with a median rate of 10.7 cents/$100 of assessed value.
• Counties collected a total of $205.6 million in revenue from property taxes in FY2020, excluding Fayette County and Jefferson County.
• An estimated 28.7% of tax revenue in FY2020 collected by counties came from property tax

Counties are limited in their ability to increase property tax revenue over time. State law has a provision that if a county levies a property tax rate that will increase revenue more than 4 percent over the prior year (excluding revenue from new property), then the portion of the rate that will bring in revenue more than 4 percent over the prior year is subject to recall (KRS 68.245).

• From FY2010 to FY2020, property tax revenue increased by 32.5 percent – an average 3.3 percent per year over 10 years.
• Property taxes made up a smaller portion of total tax revenue in FY2020, decreasing from 32.6 percent in FY2010 to 28.7 percent in FY2020.

Counties are not the only entities who can levy property taxes in Kentucky. The state, cities, school districts, and special purpose governmental entities also levy property taxes. On average across all counties, only 9.5 percent of a property tax bill is collected by fiscal courts, with an average tax rate of 12.7 cents/$100, compared to 22.4 cents/$100 for cities and 66 cents/$100 for schools.

¹Data Source: Rates - Kentucky Department of Revenue, “Property Tax Rate Book 2020.” Revenue – FY2010 & FY2020 Uniform Financial Information Reports (Kentucky Department for Local Government). Excludes Fayette and Jefferson counties.