{"data":{"id":"us-ky/krs-141.428","jurisdiction":"us-ky","citation":"KRS 141.428","heading":"Kentucky Clean Coal Incentive Act -- Definitions -- Tax credit --","body":"Administrative regulations.\n(1) As used in this section:\n(a) \"Clean coal facility\" means an electric generation facility beginning\ncommercial operation on or after January 1, 2 005, at a cost greater than one\nhundred fifty million dollars ($150,000,000) that is located in the\nCommonwealth of Kentucky and is certified by the Energy and Environment\nCabinet as reducing emissions of pollutants released during generation of\nelectricity through the use of clean coal equipment and technologies;\n(b) \"Clean coal equipment\" means equipment purchased and installed for\ncommercial use in a clean coal facility to aid in reducing the level of\npollutants released during the generation of electricity from eligible coal;\n(c) \"Clean coal technologies\" means technologies incorporated for use within a\nclean coal facility to lower emissions of pollutants released during the\ngeneration of electricity from eligible coal;\n(d) \"Eligible coal\" means coal tha t is subject to the tax imposed under KRS\n143.020;\n(e) \"Ton\" means a unit of weight equivalent to two thousand (2,000) pounds; and\n(f) \"Taxpayer\" means taxpayer as defined in KRS 131.010(4).\n(2) Effective for tax years ending on or after December 31, 2006,  a nonrefundable,\nnontransferable credit shall be allowed for:\n(a) Any electric power company subject to tax under KRS 136.120 and certified\nas a clean coal facility or any taxpayer that owns or operates a clean coal\nfacility and purchases eligible coal th at is used by the taxpayer in a certified\nclean coal facility; or\n(b) A parent company of an entity identified in paragraph (a) of this subsection if\nthe subsidiary is wholly owned.\n(3) (a) The credit may be taken against the taxes imposed by:\n1. KRS 136.120; or\n2. KRS 141.020 or 141.040, and 141.0401.\n(b) The credit shall not be carried forward and must be used on the tax return filed\nfor the period during which the eligible coal was purchased. The Energy and\nEnvironment Cabinet must approve and certify use of the clean coal\nequipment and technologies withi n a clean coal facility before any taxpayer\nmay claim the credit.\n(c) The credit allowed under paragraph (a) of this subsection shall be applied both\nto the income tax imposed under KRS 141.020 or 141.040 and to the limited\nliability entity tax imposed und er KRS 141.0401, with the ordering of credits\nas provided in KRS 141.0205.\n(4) The amount of the allowable credit shall be two dollars ($2) per ton of eligible coal\npurchased that is used to generate electric power at a certified clean coal facility.\n(5) Each taxpayer eligible for the credit provided under subsection (2) of this section\nshall file a clean coal incentive credit claim on forms prescribed by the department.\nAt the time of filing for the credit, the taxpayer shall submit an electronic report\nverifying the tons of coal subject to the tax imposed by KRS 143.020 purchased for\neach year in which the credit is claimed. The department shall determine the amount\nof the approved credit and issue a credit certificate to the taxpayer.\n(6) Corporations and  pass-through entities subject to the tax imposed under KRS\n141.040 or 141.0401 shall be eligible to apply, subject to the conditions imposed\nunder this section, the approved credit against its liability for the taxes, in\nconsecutive order as follows:\n(a) The credit shall first be applied against both the tax imposed by KRS\n141.0401 and the tax imposed by KRS 141.020 or 141.040, with the ordering\nof credits as provided in KRS 141.0205;\n(b) The credit shall then be applied to the tax imposed by KRS 136.120.\nThe credit shall meet the entirety of the taxpayer's liability under the first tax listed\nin consecutive order before applying any remaining credit to the next tax listed. The\ntaxpayer's total liability under each preceding tax must be fully met before th e\nremaining credit can be applied to the subsequent tax listed in consecutive order.\n(7) If the taxpayer is a pass -through entity not subject to tax under KRS 141.040, the\namount of approved credit shall be applied against the tax imposed by KRS\n141.0401 at the entity level, and shall also be distributed to each partner, member,\nor shareholder based on the partner's, member's, or shareholder's distributive share\nof the income of the pass -through entity. The credit shall be claimed in the same\nmanner as specified in subsection (6) of this section. Each pass -through entity shall\nnotify the department electronically of all partners, members, or shareholders who\nmay claim any amount of the approved credit. Failure to provide information to the\ndepartment in a ma nner prescribed by regulation may constitute the forfeiture of\navailable credits to all partners, members, or shareholders associated with the pass -\nthrough entity.\n(8) The taxpayer shall maintain all records associated with the credit for a period of five\n(5) years. Acceptable verification of eligible coal purchased shall include invoices\nthat indicate the tons of eligible coal purchased from a Kentucky supplier of coal\nand proof of remittance for that purchase.\n(9) The department shall develop the forms re quired under this section, specifying the\nprocedure for claiming the credit, and applying the credit against the taxpayer's\nliability in the order provided under subsections (6) and (7) of this section.\n(10) The Office of Energy Policy within the Energy an d Environment Cabinet and the\ndepartment shall promulgate administrative regulations necessary to administer this\nsection.\n(11) This section shall be known as the Kentucky Clean Coal Incentive Act.","path":["KRS Chapter 141"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=49201","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:35Z","sha256":"4e1db32104f42f94d5b4cd1e27e5d2586b0bdaf5a7d7a73883b7924a4973abe2","source_id":"us-ky","stale":false,"prev":"us-ky/krs-141.425","next":"us-ky/krs-141.430"},"notice":"GroundRules: Original legal text. Not legal advice."}