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Category: Kentucky

Kentucky Use Tax

Pursuant to KRS 139.330, a 6 percent use tax is due if you make out–of–state purchases for storage, use or other consumption in Kentucky and did not pay at least 6 percent state sales tax to the seller at the time of purchase. For example, if you order from catalogs, make purchases through the Internet, or shop outside Kentucky for items such as clothing, shoes, jewelry, cleaning supplies, furniture, computer equipment, software, office supplies, books, souvenirs, exercise equipment or subscribe to magazines, you may owe use tax to Kentucky. It is important to remember that use tax applies only to items purchased outside Kentucky, including another country, which would have been taxed if purchased in Kentucky.

Kentucky provides a Use Tax Calculation Worksheet and Optional Use Tax Table to assist in determining the amount of Use Tax due, if any. The Optional Use Tax Table is designed for those purchases of less than $1,000. If you made untaxed out-of-state purchases in amounts under $1,000, but do not have records readily available that show the amount of those purchases, you may use the Optional Use Tax Table to estimate the compensating use tax based on your Kentucky Adjusted Gross Income. All untaxed purchases in the amount of $1,000 or greater must be accounted for on an actual basis using the Use Tax Calculation Worksheet. Failure to timely report may result in assessment of penalty and interest in addition to the tax amount due.

To view the Use Tax Calculation Worksheet and Optional Use Tax Table from Kentucky, please refer to Kentucky Use Tax by clicking here.

Credit Against the Kentucky Use Tax Due

You may reduce or eliminate the amount of Kentucky use tax due by the amount of state sales tax paid to the out–of–state seller. The reduction may not exceed the amount of Kentucky use tax due on the purchase. For example, if Georgia state sales tax of 4 percent is paid, only the additional 2 percent is due to Kentucky, or if Illinois state sales tax of 6.25 percent is paid, no additional Kentucky use tax is due. Note: Sales tax paid to a city, county or country cannot be used as a credit against the Kentucky use tax due.