Current Hot Topics for the Kentucky Department of Revenue.
Notice to Remote Vendors
Effective July 1, 2013, out-of-state retailers with no legal requirement to collect tax in this state, and who expect more than $100,000 in gross annual sales to Kentucky residents, must notify their Kentucky customers that use tax must be reported and paid directly to the Department of Revenue on applicable purchases in accordance with KRS 139.450.
The notice must be readily visible and contain the information set forth as follows:
- The retailer is not required to and does not collect Kentucky sales or use tax;
The purchase may be subject to Kentucky use tax unless the purchase is exempt from taxation in Kentucky;
- The purchase is not exempt merely because it is made over the Internet, by catalog, or by other remote means; and
- The Commonwealth of Kentucky requires Kentucky purchasers to report all purchases of tangible personal property or digital property that are not taxed by the retailer and pay use tax on those purchases unless exempt under Kentucky law. The tax may be reported and paid on the Kentucky individual income tax return or by filing a consumer use tax return with the Kentucky Department of Revenue.
The referenced forms and corresponding instructions can be found on DOR’s website at http://revenue.ky.gov/individual/usetax.htm.
For recent correspondence on this subject, click here.
Important Schedule A Information for Multistate Corporations or Pass-Through Entities
A multistate corporation or pass-through entity must use the statutory formula to apportion income unless the corporation or pass-through entity has been required or granted approval in writing by the Department of Revenue (DOR) to use an alternative method provided by KRS 141.120(9)(a). A copy of the letter from the DOR must be attached to the return when filed. Do not check the box on Schedule A, Apportionment and Allocation, indicating the use of an alternative allocation and apportionment formula if the corporation has not received written approval from the DOR.
Income Tax Filing Date for Farmers and Fishermen Extended [PDF - 65KB] 2-21-13
Common errors on Corporation Income and Pass Through Entity Income and Limited Liability Entity tax due returns which may result in a delay of processing the return and/or result in the issuance of a tax bill.
• Not including payment with return;
• Not submitting 740NP-WH and PTE-WH separately from tax returns;
• Payment submitted with incorrect account number;
• One payment submitted for multiple liabilities, tax types or different year ending period;
• Omitting Form 41A720SL when paying with an extension;
• Omitting Form 41A720ES when paying an estimated payment;
• Sending just a check with no documentation as to how or where it is to be posted; and/or
• An LLET schedule does not constitute a complete return and cannot be processed as a return filed.
The FEIN# Number & Type of Tax being paid should be written on the check to further assist in the correct processing of all payments.
1099/W2G Reporting Information
The Kentucky Department of Revenue (DOR) is now accepting 1099Gs, 1099Ms, 1099Rs, 1099-Bs, 1099DIVs, 1099-INTs, 1099-Ks, 1099-OIDs and W2Gs electronically. Electronic submissions can only be made via CD and are required to be in the federal format found in Pub. 1220 Rev. Proc. 2010-26. View detailed specifications on the state defined fields.
1099 Forms are only required to be submitted to Kentucky DOR when Kentucky tax is withheld.
Letters of Good Standing
Information regarding Letters of Good Standing.
Individual Income Taxpayer Assistance
This link provides detailed information regarding taxpayer assistance in filing individual income tax. Click here for additional information.
Employer Health Insurance Notification
Employer Health Insurance Notification [PDF - 67KB] (updated 03-21-11)
2013 Tax Interest Rate
Annual adjustment of tax interest rate set for 2013
Pursuant to KRS 131.183, the 2013 tax interest rate has been set at 4 percent .The rate charged by the Kentucky Department of Revenue on unpaid taxes is 6 percent . When interest is due on a refund, the rate shall be 2 percent.
This rate, effective Jan. 1, 2013, is based on the prime interest rate charged by Kentucky banks during the month of October 2012. A recent survey of Kentucky banks revealed that the average prime interest rate in October was 4 percent.
Official Memo regarding the 2013 Tax Interest Rate [TIF - 40KB]
Additional Hot Topics
Farmer-Fishermen tax file date extended
Click here for more details.
Additional Hot Topics include:
- Military Spouses Residency Relief Act (MSRRA)
- Military Pay Income Tax Exemption
- Nexus Consolidated Return Guidelines
Click here for more details.