Starting in 2023, some Kentuckians will see changes in their residential utility sales taxes due to provisions in House Bill 8.
So here are the basics. The tax affects additional properties residents pay utilities on beyond their primary residence. KU spokesperson Daniel Lowry says that means the majority of Kentuckians will automatically be exempt and won't need to do anything.
"For most folks, if you're like me and you only have one home in Kentucky, no action is required to have the exemption for this," he says.
So far, so good.
But let’s say you do have additional properties. First of all, KU customers in that situation should have received an email or letter instructing them on what to do next and how to see which properties can be exempted and which can’t.
It’s important to sort out – and soon – because starting in January, water, gas, and electric for all extra properties will fall under the state’s 6% sales tax. Where it starts to get complicated is in the case of landlords or rural property owners who may have run utilities out to other structures.
If you fall into one of those categories or aren’t sure about a property, you can find KU's frequently asked questions link here. Lowry says, depending on your questions, it might help to seek advice elsewhere.
"The real experts really are the Department of Revenue, so those folks have on their website an FAQ," he adds. "Your tax expert, whoever does your taxes, those folks could be helpful if you're in the complicated situation where you have some tricky situations with multiple properties or properties that you're not sure about."
Lowry says KU’s exemption form can be filled out online, and those who miss the deadline can correct that problem by completing it after the fact. But the best thing to do is fill it out as soon as possible. If it turns out you didn’t need to, Lowry says that won’t hurt.
