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Kentucky Bringing Use Tax to the Forefront

  • Jan 30, 2012 | Susan McLain

To encourage residents to calculate and identify their use tax owed on internet purchases, the state of Kentucky is making a Look-Up Table available on the 2011 income tax forms.

According to the state website, “As the popularity of web-based and mobile e-commerce continues to increase, the liability of purchasers for payment of the 6 percent Kentucky use tax also increases. Kentucky consumers are required [to] report use tax on their individual income tax returns to accurately reflect their tax liability, and to ensure that our Kentucky-based retailers are not unfairly undercut by competing out-of-state retailers that fail to collect the tax on taxable products delivered into Kentucky.”

Kentucky imposes a use tax on the purchase price of items purchased and used, stored or otherwise consumed in the state of Kentucky. The Look-Up Table “…provides an option to report estimated use tax owed on retail purchases based upon Kentucky adjusted gross income when receipts are not readily available to calculate the actual unpaid use tax liability.”

FOR BUSINESSES – AN IMPORTANT NOTICE: Though Kentucky is being proactive by providing the Look-Up tool for individuals to file their sales and use tax liability, businesses must still use original Kentucky Sales and Use Tax return forms. State forms 51A102, 41A102E, 51A103 and 51A113 “…are not available online or by fax.” Though the forms can be scanned for processing, “…[f]ailure to use the original forms delays processing.” Delayed processing, for whatever reason, increases risk to your business, as forms considered late may have late fees and penalties applied.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Susan McLain
Avalara Author Susan McLain
Susan McLain began her career as a technical writer in technology industries such as satellite networking and medical devices. Her skills encompass technical and marketing writing, usability engineering, verification and validation testing and protocol writing, requirements development, business analysis, technical illustration/graphic design and marketing. She has owned her own business providing service to small to medium sized business and in other positions, she has been in project management, documentation and marketing. She is currently the content specialist for Avalara helping to “make sales tax less taxing.”