Thursday, March 3, 2016

New Uniform Local Tax Form Available for Kentucky

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Kentucky has city, county, and school district occupational license taxes that employers withhold from employee wages. Local information used to be very difficult to find for Kentucky because there isn’t one agency that administered these local taxes.

That changed in 2012 when state legislation (H.B. 277, L. 2012) was enacted authorizing the Kentucky Secretary of State to provide each locality’s occupational license tax form, instructions, and ordinance at a public website. The 2012 legislation also authorized the Secretary of State to develop uniform local occupational license tax forms for use by all localities by July 1, 2017. Form OL-S, Single Tax District, Occupational License Fee Return, is now available on online, along with instructions.

This form can be used by employers doing business in single tax districts. What is a single tax district? One that collects occupational license taxes for its district only. Taxing districts may choose to accept the new form or submit their own forms until July 1, 2017.

After July 1, 2017, each district must accept the uniform forms with a limited exception based on financial hardship. If the locality qualifies for the hardship exemption, then it must have its own forms on the website.

A new uniform form for multi-tax districts is being developed: Form OL-M. An example of a multi-tax district is Kenton County, which is the tax collection agent for Kenton County and 15 cities. Look for the new Form OL-M to be released by the Secretary of State in the coming months.

Read PayState Update for more details and check back with Pay News Now as it continues to follow this topic.