Filing your Kentucky tax return for 2022 may seem intimidating, especially if you're new to tax filing or handling your taxes. If you know the forms, deadlines, and requirements ahead of time, you can avoid stress at the last minute during tax season, whether you're an individual, sole proprietor, or small business owner. This guide will show you how to do it step by step, with simple instructions that are easy for both new and experienced filers to understand.
Most people in Kentucky have to file income tax returns based on their income, filing status, and deductions. The process begins with your federal tax return, which feeds into your state return. You will determine if you are eligible for common credits like the child or the earned income tax credit, figure out how much you owe, and choose how to file and pay. You can choose direct deposit to get your money faster if you are eligible for a refund.
This article has everything you need to file your taxes correctly, like what forms to use and how to figure out how much you owe in taxes. Available deductions and how to track your refund. It also explains how to avoid common mistakes and what to do if filing past the deadline. This guide will help you prepare to file your Kentucky income tax return for the 2022 tax year, whether you want to get the biggest refund possible or ensure your return is correct.
Kentucky's individual income tax system is easy to comprehend. The state went from a flat tax rate of 4% to 5% in 2022. Regardless of how you file, this flat rate applies to most income. Unlike progressive tax systems, there are no tax brackets in Kentucky. Once you determine your Kentucky adjusted gross income, you use the flat rate to calculate your income tax due.
Your federal adjusted gross income (AGI) is the first thing Kentucky uses to determine your federal tax return, an essential first step before filing state taxes. After you file your federal return, you will change your AGI by adding and subtracting things specific to Kentucky. This adjusted amount becomes your Kentucky AGI and is the basis for determining how much you owe.
Key tax changes for the 2022 tax year include:
Understanding these updates is key to avoiding filing errors, especially for those who have not filed in several years. Kentucky’s approach remains tied closely to federal tax data, so preparing your federal return accurately before completing your state return is essential.
Kentucky requires part-year residents and nonresidents with Kentucky-source income to file a tax return if their income meets certain levels. Your modified gross income and Kentucky adjusted gross income, not just your wages, determine whether you need to file.
You must file a Kentucky tax return if both of the following apply:
Your residency status and income type determine which Kentucky income tax form to file. These forms are available as downloadable PDFs or via approved e-file platforms.
Please carefully review the instructions for each form and ensure all required schedules are included. Your tax return may be delayed or rejected if any required documentation is missing.
Filing your Kentucky tax return is a multi-step process that begins with your federal tax return and ends with submitting your completed state return. Follow these steps to ensure accurate filing and to maximize your refund if eligible.
You’ll need the following:
Your federal adjusted gross income is the starting point for Kentucky income tax calculations. Before beginning your state return, prepare your federal return using IRS-approved forms or software.
Fill out the Kentucky form with:
Use Schedule M to adjust your federal AGI:
Subtract your deductions from Kentucky AGI to get taxable income. To find your tax owed, multiply this amount by the flat 5% rate.
You may qualify for:
If you made out-of-state purchases (such as online purchases) without paying sales tax, you might be liable for use tax. Use the optional table or actual receipts.
List all of your KY income tax withholdings, estimated tax payments, and any carryovers from tax returns from the previous year.
If your total payments exceed your tax, you’ll receive a refund. You must pay the rest of your taxes by the deadline if you owe. Refunds are faster if you choose direct deposit.
You can file your Kentucky tax return electronically or by mailing a paper return. In general, electronic filing lowers the possibility of errors and is quicker and more secure.
Benefits of electronic filing:
If you choose to file by mail, be sure to send your return to the correct address based on your filing type:
Always sign your paper return and include all required forms and schedules. Incomplete returns may be rejected or delayed.
If you owe money on your Kentucky tax return, you have multiple options for paying your balance. Payments are due by the original tax filing deadline to avoid penalties and interest.
Use the official Kentucky ePayment system at epayment.ky.gov. You can:
Electronic payments are processed quickly and come with instant confirmation. This is the preferred method for most taxpayers.
Make checks or money orders payable to:
KY State Treasurer
Mail to:
KY Department of Revenue
Frankfort, KY 40619-0008
Include the following on your check:
Do not staple the check to your return. If paying by check with an e-filed return, attach Form 740-V.
Once you’ve filed your return, you can check your Kentucky refund status or see how much you owe using state tools.
Use the “Where’s My Refund?” tool at refund.ky.gov. You’ll need:
Processing times:
Select direct deposit on your return for the fastest refund delivery.
If you owe taxes and need to confirm your balance, visit epayment.ky.gov. There, you can view:
Note: Kentucky cannot provide information about your federal tax refund or IRS account. For those, visit irs.gov.
Even simple errors can delay your Kentucky tax refund or result in penalties. To ensure accurate tax filing, double-check your information before submission.
Avoiding these common issues can help you get your refund faster and prevent unexpected letters from the Department of Revenue.
Use this checklist before you submit your return to avoid common errors and ensure faster processing.
If you didn’t file your Kentucky tax return by the deadline of April 18, 2023, you should submit it as soon as possible. Late filing and late payment may result in penalties and interest. If you cannot pay immediately, filing now limits the additional cost. The Kentucky Department of Revenue recommends filing to avoid enforcement actions and to preserve eligibility for refunds or credits from your federal and state taxes.
Yes, many individuals can file their Kentucky tax return for free. Kentucky offers a free fillable form service through KY File for simple returns. Additionally, IRS Free File partners may include state filing options at no cost. E-file services reduce errors and speed up the entire process. Expert help is also available through approved providers for those filing taxes for the first time or seeking a maximum refund.
Kentucky filers often overlook essential tax credits and deductions that could lower their income tax. These include the earned income tax credit, student loan interest deduction, and the child tax credit. The pension exclusion and certain property-related deductions are also commonly missed. Reviewing your federal tax return and prior-year tax information can help determine eligibility. These missed opportunities could mean leaving dollars unclaimed during tax season.
To request a filing extension, submit Form 740-EXT by the original due date. An extension allows you to file your tax return until October but does not delay your obligation to pay. To avoid penalties, you must pay at least 90% of your expected income tax by the April deadline. Always include your primary Social Security number and mailing address to ensure your form is processed correctly by the Department of Revenue.
If you were married by the last day of 2022, you can choose to file jointly even if you moved into or out of Kentucky during the year. You may need to file Form 740-NP if you were only a resident for the year. Ensure your filing status matches your federal return and include all Kentucky-source income. Keep track of employer-provided income and deductions that apply during residency periods.
Kentucky requires you to report use tax on out-of-state purchases when no sales tax was collected. This includes online orders, catalog purchases, or property bought while visiting states like Texas, California, New Mexico, or Pennsylvania. You can calculate the use tax using your receipts or the optional tax table. Reporting this on your Kentucky tax return helps avoid audit support issues and keeps your filing in compliance with state tax laws.
Currently, Kentucky does not support electronic filing for amended tax returns. If you need to correct a return that has already been filed, you must submit Form 740-X by mail. Be sure to include any corrected forms, updated calculations, and explanations. Indicate your filing status and sign the amended return. Retain copies for your records. Confirm that your updated tax information is complete and accurate for faster processing.
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