Instructions For Form 720 - Kentucky Corporation Income Tax And Llet Return

Mailing/Payment—If including payments for other taxes in

The interest due on any late payment or underpayment shall

addition to corporation income tax or LLET, send a separate

be at the rate provided by KRS 131.183(1). KRS 141.042(4) and

check or money order for each type of tax. Mail the Kentucky

KRS 141.985

Corporation Income Tax and LLET Return to the Kentucky

Penalty: Failure to pay estimated tax installments equal to

Department of Revenue, Frankfort, KY 40620. Make the check(s)

the amount determined by subtracting $5,000 from 70% of

payable to the Kentucky State Treasurer.

the combined tax liability due under KRS 141.040 and KRS

141.0401 as computed by the taxpayer on the return filed for

Filing/Payment Date—A Kentucky Corporation Income Tax

the taxable year will result in an underpayment penalty of 10%

and LLET Return must be filed and payment must be made

of the underpayment. The underpayment penalty will not apply

on or before the 15th day of the fourth month following the

if the estimated tax payments are equal to or greater than the

close of the taxable year. KRS 141.160, KRS 141.220 and 103

combined tax liability due under KRS 141.040 and KRS 141.0401

KAR 15:050

for the previous taxable year, and the combined tax liability due

under KRS 141.040 and KRS 141.0401 for the previous taxable

If the filing/payment date falls on a Saturday, Sunday or a legal

year was equal to or less than $25,000. KRS 131.180(3) and KRS

holiday, the filing/payment date is deemed to be on the next

141.990(3)

business day. KRS 446.030(1)(a)

Amended Return—Amended Kentucky forms must be used to

Extensions—An extension of time to file a Kentucky Corporation

make any corrections to Form 720 (See table below for required

Income Tax and LLET Return may be obtained by either making

amended form), including net operating loss carrybacks (for

a specific request to the Department of Revenue or attaching a

years prior to 2005), capital loss carrybacks and Internal Revenue

copy of the federal extension to the return when filed. A copy

Service audit adjustments. Do not submit Federal Form 1139 to

of the federal extension submitted after the return is filed does

apply for a refund of Kentucky corporation income tax resulting

not constitute a valid extension, and late filing penalties will be

from net operating loss carryback or a capital loss carryback.

assessed. If a payment is made with an extension, Kentucky

Failure to submit the required Kentucky amended forms will

Form 41A720SL must be used. For further information, see the

result in delays in processing refunds requested on amended

instructions for Form 41A720SL. 103 KAR 15:050

returns.

NOTE: An extension of time to file a return does not extend the

Tax Year

Amended Form

date for payment of tax.

2004 & prior ...........720X

Corporation Estimated Taxes

2005 & 2006 ............720–Amended

2007 & 2008 ............720–Amended (2007–2008)

The Corporation Income/Limited Liability Entity Tax Estimated

2009 - 2013 .............720 (check Amended return box

Tax Voucher, Form 720–ES, is used to submit estimated tax

or Amended return—RAR box)

payments for corporation income and LLET. See Electronic

Funds Transfer (EFT) on page 4. If the corporation is required to

make estimated tax payments and needs Form 720-ES vouchers,

Net Operating Losses—For tax years beginning on or after

contact the Department of Revenue at (502) 564-3658 or visit

January 1, 2005, the net operating loss carryback deduction

shall not be allowed. Any net operating losses shall be carried

forward. See Kentucky Net Operating Loss Deduction on page

NOTE: See for information on the 2014

10 of these instructions for further discussion.

estimated tax payments.

Internal Revenue Service Audit Adjustments—A corporation

Corporation Estimated Tax Payments—A corporation must make

which has received final adjustments resulting from Internal

estimated tax installments if its combined tax liability under KRS

Revenue Service audits must submit a copy of the “final

141.040 and 141.0401 can reasonably be expected to exceed

determination of the federal audit” within 30 days of the

$5,000. Estimated tax installments are required as follows:

conclusion of the federal audit. Use the required amended form

from the table above for reporting federal audit adjustments and

If the estimated tax is reasonably expected to exceed $5,000

computing additional tax due or refunds. Failure to submit the

before the 2nd day of the 6th month, 50% of the estimated tax

required amended form will result in delays in processing refunds

must be paid by 15th day of the 6th month, 25% by the 15th day

requested on amended returns. Any refund claim resulting from

of the 9th month, and 25% by the 15th day the 12th month.

a federal audit adjustment must be filed within the four years of

the date the tax was paid or within six months of the conclusion

If the estimated tax is reasonably expected to exceed $5,000 after

of the federal audit, whichever is later. KRS 141.210(2)(d) and

the 1st day of the 6th month and before the 2nd day of the 9th

KRS 141.235(2)(b)

month, 75% of the estimated tax must be paid by the 15th day of

the 9th month, and 25% by the 15th day the 12th month.

Interest—Interest at the tax interest rate plus two percent is

applied to corporation income tax and LLET liabilities not paid

If the estimated tax is reasonably expected to exceed $5,000 after

by the date prescribed by law for filing the return (determined

the 1st day of the 9th month, 100% of the estimated tax must be

without regard to extensions thereof). The tax interest rate for

paid by the 15th day the 12th month.

2014 is available online at , or you may

contact the Department of Revenue at (502) 564-8139.

Safe harbor: A corporation can satisfy its declaration requirement

if its estimated tax payments are equal to the combined tax

Penalties

liability under KRS 141.040 and 141.0401 for the prior tax year,

and its combined tax liability for the prior tax year was equal

Failure to file the Kentucky Corporation Income Tax and LLET

to or less than $25,000. If the estimated tax is based on the

Return by the filing date including extensions—2 percent of the

corporation’s combined tax liability for the prior tax year, 50%

tax due for each 30 days or fraction thereof that the return is late

of the estimated tax must be paid by 15th day of the 6th month,

(maximum 20 percent). The minimum penalty is $10 for each

25% by the 15th day of the 9th month, and 25% by the 15th day

tax. KRS 131.180(1)

the 12th month.

Jeopardy Fee—A $100 minimum penalty on all nonfiled returns,

Interest: Failure to pay estimated tax installments on or before

when the taxpayer fails to file a return or provide information

the due date prescribed by 141.042 and 141.044 shall result in

after being requested to do so by the Department of Revenue.

an assessment of interest on the late payment or underpayment.

KRS 131.150(2)

Instructions For Form 720 - Kentucky Corporation Income Tax And Llet Return - 2013 Page 5

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