Alabama vs Kentucky
Property Tax Comparison: Alabama vs. Kentucky
Overview
Both Alabama and Kentucky have median home values near $190,000 and median household incomes around $62,000. According to the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates), Alabama’s effective property‑tax rate is 0.38 percent, while Kentucky’s is 0.77 percent. The lower rate in Alabama translates into lower annual property‑tax bills for comparable home values.
Side‑by‑Side Metrics
| Metric | Alabama | Kentucky |
|---|---|---|
| Effective property‑tax rate | 0.38 % | 0.77 % |
| Median home value | $195,100 | $192,300 |
| Median annual property tax | $738 | $1,472 |
| Property tax on a $250,000 home | $946 | $1,914 |
| Property tax on a $500,000 home | $1,892 | $3,827 |
| Median household income | $62,027 | $62,417 |
Source: According to the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates).
Which State “Wins” on Property Taxes?
- Winner (lower tax rate): Alabama
- Tax‑rate difference: 0.39 percentage points, which is a 50.6 % lower rate than Kentucky’s (0.39 ÷ 0.77 ≈ 0.506).
- Annual tax difference for a $250,000 home: $1,914 – $946 = $968.
- Annual tax difference for a $500,000 home: $3,827 – $1,892 = $1,935.
Based on the lower effective property‑tax rate and the resulting lower annual tax amounts, Alabama provides a less costly property‑tax environment than Kentucky for comparable home values.
Who Might Benefit Most from This Comparison?
| Audience | Relevance of the Data |
|---|---|
| Current homeowners | Understanding how much of their housing cost is attributable to property tax and how that expense could change if they relocate. |
| Prospective homebuyers | Assessing the total cost of ownership in each state, especially when evaluating homes around the $250k‑$500k price range. |
| Retirees | Property taxes often constitute a fixed expense; a lower rate (as in Alabama) can reduce the overall tax burden on fixed incomes. |
| Real‑estate investors | Lower property‑tax rates can improve cash‑flow projections and return‑on‑investment calculations. |
| Policy analysts | The data illustrate how state‑level tax policies differ, providing a baseline for fiscal comparisons. |
All groups should consider that property‑tax rates are only one component of a state’s overall tax climate. Other taxes (income, sales, excise) and public‑service costs may influence the total fiscal picture.
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All figures are drawn from the U.S. Census Bureau’s 2023 American Community Survey (5‑year estimates) and reflect the most recent publicly available data.
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Data Source
All figures are drawn from the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates). This comprehensive dataset provides reliable, standardized property tax information across all states.