Kentucky Income Tax Forms Requisition - Kentucky Department Of Revenue

November 2011

Kentucky Tax Alert

DEPARTMENT OF REVENUE SETS 2012 TAX

withholding at each level of each pass through entity of

INTEREST R ATE

multiple tier structures. Therefore, withholding, as well

as the calculation to determine if an entity is required

Pursuant to KRS 131.183 et seq., the Commissioner of

to make declaration payments, will be at each level of

the Department of Revenue has set the following tax

the structure using only the nonresident individual and

interest rates: for taxes underpaid the interest rate shall

corporations doing business in Kentucky only through

be 6 percent; for taxes overpaid the interest rate shall

its ownership interest in the pass-through entity. Trusts

be 2 percent when interest is required to be paid.

and Estates are entities treated as individuals and are

included in the withholding requirement.

The rates, effective Jan. 1, 2012, are based on the prime

rate charged by Kentucky banks during October 2011.

DOR OFFICES CLOSED FOR HOLIDAYS

A recent survey of Kentucky banks showed the average

prime interest rate in October was 3.69 percent. Pursuant

Pursuant to KRS 18A.190, all DOR offices will be closed

to KRS 131.183(1)(c), the average prime rate is rounded

Thursday and Friday, Nov. 24 and 25, in observance

to the nearest full percent, which is 4 percent.

of Thanksgiving; Tuesday, Dec. 13 for the Governor's

Inauguration; Friday, Dec. 23 and Monday, Dec. 26 for

Effective May 1, 2008, all taxes payable to the

Christmas; and Friday, Dec. 30 and Monday, Jan. 2,

commonwealth that have not been paid at the time

2012 for New Year’s Day holidays. Normal hours will

prescribed by statute shall accrue interest at the base

resume on Tuesday, Jan. 3, 2012.

rate plus two percent; when interest is paid on a refund,

it shall be paid at the base rate minus two percent.

Happy Holidays!

The Commissioner of the Department of Revenue is

required by law to set the tax interest rate by Nov. 15

for the following calendar year.

Kentucky Tax Alert comments and suggestions should

be addressed to the Ofﬁ ce of Public Information, Finance

Secretary’s Ofﬁ ce, Frankfort, Kentucky, (502) 564-9165.

WHAT’S NEW IN PASS-THROUGH?

L. B

, Governor

TEVEN

ESHEAR

Effective for taxable years beginning after Dec. 31,

, Secretary

2011, every pass-through entity required to withhold

ORI

LANERY

Finance and Administration Cabinet

Kentucky income tax as provided by subsection (5) of

B. M

, Commissioner

KRS 141.206 will be required to make a declaration

HOMAS

ILLER

Department of Revenue

and pay estimated tax if

Cindy Lanham, Editor

The nonresident individual owner’s tax liability

Sarah Gilkison, Publications Coordinator

can reasonably be expected to exceed five hundred

Production/Design: Support Services

dollars ($500). This includes estates and trusts.

The Kentucky Department of Revenue does not

And/or:

discriminate on the basis of race, color, national origin,

A corporate owner doing business in Kentucky only

sex, religion, age or disability in employment or the

provision of services.

through its ownership interest in a pass-through

entity has a tax liability that can reasonably be

The Department of Revenue can be found at...

expected to exceed five thousand dollars ($5,000).

Also be reminded that when withholding on the

distributable share income of nonresident individuals,

estates, trusts and corporations, no withholding is

made for partners or members that are pass-through

entities. The distributive share income will continue

to pass through as Kentucky source income requiring

Kentucky Income Tax Forms Requisition - Kentucky Department Of Revenue - 2011 Page 3

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