KRS 67.750: Definitions for KRS 67.750 to 67.790.

As used in KRS 67.750 to 67.790, unless the context requires otherwise:

(1) "Business entity" means each separate corporation, limited liability company,

business development corporation, partnership, limited partnership, sole

proprietorship, association, joint stock company, receivership, trust, professional

service organization, or other legal entity through which business is conducted;

(2) "Compensation" means wages, salaries, commissions, or any other form of

remuneration paid or payable by an employer for services performed by an

employee, which are required to be reported for federal income tax purposes and

adjusted as follows:

(a) Include any amounts contributed by an employee to any retirement, profit

sharing, or deferred compensation plan, which are deferred for federal income

tax purposes under a salary reduction agreement or similar arrangement,

including but not limited to salary reduction arrangements under Section

401(a), 401(k), 402(e), 403(a), 403(b), 408, 414(h), or 457 of the Internal

Revenue Code; and

(b) Include any amounts contributed by an employee to any welfare benefit, fringe

benefit, or other benefit plan made by salary reduction or other payment

method which permits employees to elect to reduce federal taxable

compensation under the Internal Revenue Code, including but not limited to

Sections 125 and 132 of the Internal Revenue Code;

(3) "Fiscal year" means "fiscal year" as defined in Section 7701(a)(24) of the Internal

Revenue Code;

(4) "Employee" means any person who renders service s to another person or business

entity for compensation, including an officer of a corporation and any officer,

employee, or elected official of the United States, a state, or any political

subdivision of a state, or any agency or instrumentality of any one (1) or more of the

above. A person classified as an independent contractor under the Internal Revenue

Code shall not be considered an employee;

(5) "Employer" means "employer" as defined in Section 3401(d) of the Internal

Revenue Code;

(6) "Gross receipt s" means all revenues or proceeds derived from the sale, lease, or

rental of goods, services, or property by a business entity reduced by the following:

(a) Sales and excise taxes paid; and

(b) Returns and allowances;

(7) "Internal Revenue Code" means the Internal Revenue Code in effect on December

31, 2008, as amended;

(8) "Net profit" means gross income as defined in Section 61 of the Internal Revenue

Code minus all the deductions from gross income allowed by Chapter 1 of the

Internal Revenue Code, and adjusted as follows:

(a) Include any amount claimed as a deduction for state tax or local tax which is

computed, in whole or in part, by reference to gross or net income and which

is paid or accrued to any state of the United States, local taxing authority in a

state, the District of Columbia, the Commonwealth of Puerto Rico, any

territory or possession of the United States, or any foreign country or political

subdivision thereof;

(b) Include any amount claimed as a deduction that directly or indirectly is

allocable to income which is either exempt from taxation or otherwise n ot

taxed;

(c) Include any amount claimed as a net operating loss carryback or carryforward

allowed under Section 172 of the Internal Revenue Code;

(d) Include any amount of income and expenses passed through separately as

required by the Internal Revenue Code to an owner of a business entity that is

a pass-through entity for federal tax purposes; and

(e) Exclude any amount of income that is exempt from state taxation by the

Kentucky Constitution or the Constitution and statutory laws of the United

States;

(9) "Sales revenue" means receipts from the sale, lease, or rental of goods, services, or

property;

(10) "Tax district" means a city, county, urban-county, charter county, consolidated local

government, school district, special taxing district, or any other statutorily created

entity with the authority to levy net profits, gross receipts, or occupational license

taxes;

(11) "Taxable gross receipts," in case of a business entity having payroll or sales

revenues both within and without a tax district, means gr oss receipts as defined in

subsection (6) of this section, as apportioned under KRS 67.753;

(12) "Taxable gross receipts," in case of a business entity having payroll or sales revenue

only in one (1) tax district, means gross receipts as defined in subsect ion (6) of this

section;

(13) "Taxable net profit," in case of a business entity having payroll or sales revenue

only in one (1) tax district, means net profit as defined in subsection (8) of this

section;

(14) "Taxable net profit," in case of a business e ntity having payroll or sales revenue

both within and without a tax district, means net profit as defined in subsection (8)

of this section, as apportioned under KRS 67.753; and

(15) "Taxable year" means the calendar year or fiscal year ending during the c alendar

year, upon the basis of which net income or gross receipts is computed.