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| Frequently Asked Questions - Tax and Financial Processing Branch |
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| Tax related: | ||
| 1. | Q: | Why do I get two (2) KY tax forms? |
| A:
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Kentucky
has a fuel tax and a weight distance tax. Therefore, you must file
an IFTA tax return (KIT if traveling only in Kentucky) with your
base state and a Kentucky Weight-distance tax return with Kentucky. |
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| 2. | Q: | I did not travel in KY Last quarter. Do I still need to file a KY tax return? |
| A: | Yes,
you must file a return even if you have no miles traveled in Kentucky.
Failure to file a return will subject the license to cancellation. |
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| 3. | Q: | Are there penalties & interest for late filing? How is it figured? |
| A: | Yes,
there are penalties & interest for late filers. The return must
first be computed. Once the tax amount owed has been determined,
you will multiply that amount by the penalty rate. Next you will
multiply the original amount due by the interest rate per annum
(year). This means that the interest rate is an annual interest
rate. The rate will be divided by 12 and multiplied by the number
of months late. The 2 figures will then be added together. Any licensee who fails to make any report required under the provisions of KRS 138.660 to 138.7291 by the quarterly due date may be required to pay a penalty of fifty dollars ($50) for a first offense, two hundred fifty dollars ($250) for a second offense, or five hundred dollars ($500) for any subsequent offense within any four (4) year period. The penalty is to be assessed and collected in the manner provided for the assessment and collection of taxes, or the licensee may be proceeded against in a civil action instigated by the cabinet. |
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| 4. | Q: | Why do I pay fuel tax at the pump and also pay on the KY (KIT) Quarterly return? |
| A: |
Kentucky charges a surtax in addition to the fuel tax that is paid at the pump. Some other states such as Indiana and Virginia also charge a similar surtax. In Kentucky, the fuel tax rate for special fuel and diesel is 15.3 cents per gallon and surtax is 6.9 cents per gallon. The fuel tax for gasoline is 18.3 per gallon and surtax is 3.0. This allows vehicles that are licensed at 26,000 lbs. or less, that are not required to file a fuel tax report, to only pay the 15.3 or 18.3 cent fuel tax at the time of purchase. Larger vehicles that file a quarterly tax report pay the additional 6.9 or 3.0 surtax along with the fuel tax on gallons consumed when the return is filed. This creates a two tiered tax rate which taxes larger vehicles at a slightly higher rate. |
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| 5. | Q: | I made a mistake on my tax return. What should I do? |
| A: | Complete
a new tax return as it should have been filed originally and mark
the check box for Amended Return. However, only include payment
of the difference. If you overpaid, leave the amount due field blank.
Tax returns are available from our Tax Forms page. |
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| 6. | Q: | I am out of business or no longer do business in Kentucky. What do I need to do? |
| A: | You
must notify us and all taxes must be paid up to that time. On your
final tax return you will be submitting to us mark the check box
for "Ceased Operations". Also, for good measure, highlight
the Ceased Operations item and write on the tax return "FINAL
RETURN". |
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| Audit related: | ||
| 1. | Q: | Are my records subject to audit? |
| A: | Yes,
records are subject to audit. If complete records are maintained,
the records examined would primarily be limited to mileage and fuel
information. Kentucky Revised Statute 138.680 states that complete
records are to be kept and if a taxpayer fails to provide them upon
request, an assessment can be made estimating tax due. |
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| 2. | Q: | How are off-road miles reported? |
| A: | Off-road
miles are not taxable in Kentucky for KIT and IFTA, they should
be included in the total miles operated, but should be removed to
determine the taxable miles for qualified vehicles. The KYU shows
the taxable miles for qualified vehicles. Accounting for off-road
miles may be maintained by odometer readings or information must
be time and place specific, and is subject to audit. An estimation
of off-road miles, such as a blanket percentage amount, is not acceptable. |
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Copyright © 2007 Commonwealth of Kentucky All rights reserved.