{"data":{"id":"us-ky/krs-141.209","jurisdiction":"us-ky","citation":"KRS 141.209","heading":"Annual election to have tax under KRS 141.120 imposed on pass -through","body":"entity -- Refundable tax credit -- Report to owner -- Administrative\nregulations.\n(1) For purposes of this section:\n(a) \"Authorized person\" means any individual with the author ity from the\nelecting entity to bind the electing entity or sign returns on its behalf;\n(b) \"Direct owner\" means a partner, member, or shareholder that holds an interest\ndirectly in a pass-through entity;\n(c) \"Electing entity\" means a pass -through entity t hat makes an election under\nthis section;\n(d) \"Entity owner\" means the direct or indirect owners of an electing entity\nreceiving a proportionate share of the entity's income;\n(e) \"Indirect owner\" means a partner, member, or shareholder in a pass -through\nentity that holds an interest indirectly, or through another indirect partner,\nmember, or shareholder in a pass-through entity; and\n(f) \"Owner\" means a direct or indirect partner, member, or shareholder of an\nelecting entity and includes a beneficiary of an estate or trust.\n(2) (a) For taxable years beginning on or after January 1, 2022, an authorized person\nmay elect annually, on behalf of the electing entity, to have the tax under KRS\n141.020 imposed upon the electing entity and based upon the ordinary income\nand the separately stated items of income calculated under KRS 141.206.\n(b) 1. All calculations for the return shall continue to be made as provided\nunder KRS 141.206.\n2. The election shall be made on a form prescribed by the department.\n(c) For taxable years beginning on or after January 1, 2023, the election may be\nmade at any time  during the taxable year or after the end of the taxable year,\nbut not later than the:\n1. Fifteenth day of the fourth month after the close of the taxable year; or\n2. Fifteenth day of the tenth month after the close of the taxable year, if the\nreturn is filed under KRS 141.170.\n(d) For taxable years beginning on or after January 1, 2022, but before January 1,\n2023:\n1. The election may be made after March 31, 2023, but shall be made\nbefore August 31, 2024;\n2. As a result of the electing entity making the ele ction as described in\nsubparagraph 1. of this paragraph:\na. No late payment, late filing, or other similar penalty under KRS\n131.180 shall be imposed on an electing entity; and\nb. No interest under KRS 131.183 shall apply to the tax paid by the\nelecting entity.\n(e) 1. For taxable years beginning on or after January 1, 2022, but before\nJanuary 1, 2024, an electing entity is not required to make estimated\nincome tax payments and no estimated tax penalty shall be assessed\nunder KRS 141.985.\n2. For taxable year s beginning on or after January 1, 2024, an electing\nentity shall be:\na. Required to make estimated income tax payments if the provisions\nof KRS 141.305 are met; and\nb. Subject to the estimated tax penalty under KRS 141.985 if the\nestimated income tax payments are not properly made.\n(f) The election, once made for a taxable year, is irrevocable and binding upon all\nentity owners.\n(3) For taxable years beginning on or after January 1, 2022, there shall be allowed a\nrefundable pass-through entity tax credit which shall be:\n(a) Equal to one hundred percent (100%) of the entity owner's proportionate share\nof the tax paid by the pass-through entity for the taxable year;\n(b) Claimed against the tax imposed under KRS 141.020 on a return filed by the\nentity owner, with the ordering of credits as provided in KRS 141.0205; and\n(c) Based on the pro rata share of the entity owner's income from the pass -\nthrough entity.\n(4) An electing entity shall report to each direct owner of the entity the direct owner's\nproportionate share of the tax paid for the taxable year for purposes of the pass -\nthrough entity tax credit created in subsection (3) of this section.\n(5) The department shall prescribe forms and may promulgate administrative\nregulations as needed to administer this section.","path":["KRS Chapter 141"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=53597","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:34Z","sha256":"84b128e5437540019f38195dd8ae462aa390b677fe1980e574d8aeeee4493917","source_id":"us-ky","stale":false,"prev":"us-ky/krs-141.208","next":"us-ky/krs-141.210"},"notice":"GroundRules: Original legal text. Not legal advice."}