{"data":{"id":"us-ky/krs-154.32-090","jurisdiction":"us-ky","citation":"KRS 154.32-090","heading":"Wage assessments against employees -- Calculation of amount -- Credit","body":"against individual income tax for employees -- Assessment to cease at\nexpiration of tax incentive agreement.\n(1) An approved company or, with the authority's consent, an  affiliate of an approved\ncompany may impose wage assessments against employees as provided in this\nsection if a wage assessment is included in the incentives awarded to the approved\ncompany in the tax incentive agreement. The level of wage assessment shal l be\nnegotiated as part of the tax incentive agreement.\n(2) If an economic development project is located in a heritage county, the approved\ncompany or, with the authority's consent, an affiliate of the approved company may\nrequire that each employee subje ct to the tax imposed by KRS 141.020, whose job\nis determined by the authority to be created as a result of the economic development\nproject, as a condition of employment, agree to an assessment of up to one hundred\npercent (100%) of the individual income tax rate imposed by KRS 141.020, and\nthat assessment shall operate as the Commonwealth's wage assessment. Although\nnot required for an economic development project located in a heritage county, a\nlocal jurisdiction may agree to forgo all or a portion of its local occupational license\nfee as a local wage assessment.\n(3) (a) If the economic development project is not located in a heritage county, and is\nlocated in a local jurisdiction where:\n1. No local occupational license fee is imposed;\n2. a. A local occup ational license fee greater than or equal to twenty\npercent (20%) of the individual income tax rate in KRS 141.020 is\nimposed; and\nb. The local jurisdiction agrees to forgo, as the local wage\nassessment, at least twenty percent (20%) of the individual inco me\ntax rate imposed by KRS 141.020 via credits against the local\noccupational license fee for the affected employees; or\n3. a. A local occupational license fee less than twenty percent (20%) of\nthe individual income tax rate in KRS 141.020 is imposed; and\nb. The local jurisdiction agrees to forgo the total amount of the local\noccupational license fee as the local wage assessment; then\n(b) An approved company or, with the authority's consent, an affiliate of an\napproved company may require that each employee subject to tax imposed by\nKRS 141.020, whose job is determined by the authority to be created as a\nresult of the economic deve lopment project, as a condition of employment,\nagree to pay an assessment of up to sixty percent (60%) of the individual\nincome tax rate imposed by KRS 141.020 and that assessment shall operate as\nthe Commonwealth's wage assessment.\n(4) (a) If the economic development project is not located in a heritage county, and is\nlocated in a local jurisdiction where:\n1. a. A local occupational license fee greater than or equal to twenty\npercent (20%) of the individual income tax rate in KRS 141.020 is\nimposed; and\nb. The local jurisdiction agrees to forgo an amount of the local\noccupational license fee that is less than twenty percent (20%) of\nthe individual income tax rate in KRS 141.020 as the local wage\nassessment; or\n2. a. A local occupational license fee of lesse r than twenty percent\n(20%) of the individual income tax rate in KRS 141.020 is\nimposed; and\nb. The local jurisdiction agrees to forgo only a portion of the total\namount of the local occupational license fee as the local wage\nassessment; then\n(b) An approv ed company or, with the authority's consent, an affiliate of an\napproved company may require that each employee subject to tax imposed by\nKRS 141.020, whose job is determined by the authority to be created as a\nresult of the economic development project, a s a condition of employment,\nagree to pay an assessment equal to three (3) times the forgone local wage\nassessment rate and that assessment shall operate as the Commonwealth's\nwage assessment.\n(5) If the project is not located in a heritage county, and:\n(a) Is located in a local jurisdiction that does not impose a local occupational\nlicense fee, the local jurisdiction shall be required to provide some alternative\ninducement satisfactory to the authority at the local level in order for a\npreliminarily approv ed company to receive final approval. However, the\nauthority may waive this requirement if there are reasonable circumstances\nthat prevent the local jurisdiction from providing a reasonable inducement; or\n(b) Is located in a local jurisdiction that does im pose a local occupational license\nfee, the jurisdiction may request that the authority waive the local\noccupational license fee requirements established by subsection (3) or (4) of\nthis section if the local jurisdiction offers alternative inducements of si milar\nvalue satisfactory to the authority. The authority shall review all requests for a\nwaiver, and may waive the local occupational license fee requirements and\ninstead require the local jurisdiction to provide alternative inducements of\nsimilar value if  the authority determines that the circumstances warrant an\nalternative contribution by the local jurisdiction.\n(6) Each employee paying the assessment shall simultaneously be entitled to a credit\nagainst the Kentucky individual income tax required to be w ithheld under KRS\n141.310 equal to the state portion of the assessment and shall be entitled to a credit\nagainst the local occupational license tax equal to the local portion of the\nassessment.\n(7) If more than one (1) local jurisdiction imposes an occupational license fee, the local\njurisdiction portion of the assessment shall be prorated proportionately among the\ntaxes imposed by the local jurisdictions unless one (1) local jurisdiction agrees to\nforgo the receipt of these taxes in an amount equal to the local jurisdiction portion\nof the wage assessment, in which case no proration shall be made.\n(8) If a full -time employee subject to state tax imposed by KRS 141.020 is already\nemployed by the approved company at a site other than the site of the economic\ndevelopment project, that full -time employee's job shall be deemed to have been\ncreated when the full -time employee is transferred to the site of the economic\ndevelopment project if the full -time employee's existing job is filled with a new\nfull-time employee.\n(9) If an approved company elects to impose the assessment as a condition of\nemployment, it shall be authorized to deduct the assessment from each payment of\nwages to the employee.\n(10) Notwithstanding any other provision of the Kentucky Revised Statut es, if an\napproved company elects not to deduct the assessment from each payment of wages\nto the employee, but rather requests a reimbursement of state tax imposed by KRS\n141.020 or local occupational tax in the aggregate after they have been paid to the\nstate or local jurisdiction, no interest shall be paid by the state or by the local\njurisdiction on that reimbursement.\n(11) No credit, or portion thereof, shall be allowed against any occupational license fee\nimposed by or dedicated solely to the board of education in a local jurisdiction.\n(12) An approved company imposing an assessment shall make its payroll, books, and\nrecords available to the authority or the department upon request, and shall file with\nthe authority or department documentation pertainin g to the assessment as the\nauthority or department may require.\n(13) Any assessment of the wages of employees of an approved company in connection\nwith their employment at an economic development project shall permanently cease\nat the expiration of the tax incentive agreement.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=57130","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:56Z","sha256":"9edfa9c32b174aaf1152045438298dff4953d95d1c36be640cbe34cdf43eba6e","source_id":"us-ky","stale":false,"prev":"us-ky/krs-154.32-080","next":"us-ky/krs-154.32-100"},"notice":"GroundRules: Original legal text. Not legal advice."}