UNOFFICIAL COPY 23 RS BR 291
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AN ACT relating to a property tax installment payment program. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. A NEW SECTION OF KRS CHAPTER 134 IS CREATED TO 3
READ AS FOLLOWS: 4
(1) As used in this section: 5
(a) "Designated property tax collector" means the: 6
1. Sheriff as provided in KRS 134.119; or 7
2. Special tax collector appointed by an independent school district board 8
of education as provided in KRS 160.500; and 9
(b) "Eligible taxpayer" means a taxpayer with estimated real property taxes due 10
for the assessment year of two hundred dollars ($200) or more. 11
(2) Beginning January 1, 2026, property taxes on real property collected by a 12
designated property tax collector may be paid by an eligible taxpayer in four (4) 13
quarterly installments as provided in this section. 14
(3) Each designated property tax collector shall create and administer a quarterly 15
installment payment program in accordance with this section. The program shall 16
be operational on or before January 1, 2026. 17
(4) (a) In order to estimate an eligible taxpayer's quarterly installment payments 18
prior to the actual tax liability being determined, the payments shall be 19
based on the property taxes assessed against the property for the 20
immediately preceding assessment year, unless the department allows for an 21
alternative base to be calculated for an eligible taxpayer or updated 22
assessment information is received by the designated property tax collector 23
pursuant to paragraph (c) of this subsection. 24
(b) To determine the amount of the quarterly installment payment, the 25
designated property tax collector shall add the administrative fee established 26
by subsection (6) of this section to the total taxes assessed on the property 27 UNOFFICIAL COPY 23 RS BR 291
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for the immediately preceding assessment year and then divide the sum by 1
four (4). 2
(c) 1. Within fifteen (15) days after the property tax assessments and tax 3
rates are finalized for preparing the property tax bills, as provided in 4
KRS 133.220, the county clerk shall provide the assessment and tax 5
rate information to the designated property tax collector. 6
2. When a property valuation administrator becomes aware that the 7
estimated assessment of a particular parcel of property is expected to 8
increase or decrease by more than twenty-five percent (25%) from the 9
immediately preceding year's assessment, the property valuation 10
administrator shall notify the designated property tax collector within 11
fifteen (15) days of finalizing the assessment. 12
3. The designated property tax collector shall, within thirty (30) days of 13
receipt of the updated information from the county clerk or property 14
valuation administrator as required by subparagraphs 1. and 2. of this 15
paragraph: 16
a. Make necessary adjustments to the remaining installment 17
payment amounts to allow the eligible taxpayer to pay the total 18
amount due in full on or before the due date established by 19
Section 3 of this Act; and 20
b. Notify the eligible taxpayer of the adjustments made. 21
Any adjustment, whether an increase or decrease, shall be evenly 22
divided between the remaining installment payments. 23
(d) Any overpayment, as of the due date established by Section 3 of this Act, 24
may be automatically applied to the eligible taxpayer's real property tax bill 25
for the immediately following assessment year or may be refunded to the 26
eligible taxpayer at his or her request. 27 UNOFFICIAL COPY 23 RS BR 291
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(5) (a) Before January 10, 2026, and on or before each January 10 thereafter, the 1
designated property tax collector shall: 2
1. Post information about the quarterly installment payment program on 3
its website, or on the county website; and 4
2. Send every eligible taxpayer within the jurisdiction a notification that 5
provides information about the quarterly installment payment 6
program and the requirements for participation. 7
(b) Full payment of the first installment by the eligible taxpayer on or before its 8
due date shall constitute enrollment in the quarterly installment payment 9
program, unless the eligible taxpayer: 10
1. Participates in an alternative enrollment option established by the 11
department; or 12
2. Fails to meet any additional requirements established by the 13
department. 14
(c) 1. The designated tax collector shall provide updated information to 15
eligible taxpayers regarding the status of payments and the 16
outstanding balance remaining on at least a quarterly basis and shall 17
provide access to the information electronically when possible. 18
2. Information provided by the electronic system, if available, and the 19
notifications required by this paragraph shall include, at a minimum: 20
a. The eligible taxpayer's estimated property taxes; 21
b. The amount of each quarterly installment; 22
c. The due date for each quarterly installment; 23
d. The total property taxes paid to date by the eligible taxpayer for 24
the assessment year; 25
e. The eligible taxpayer's outstanding property tax balance for the 26
assessment year; 27 UNOFFICIAL COPY 23 RS BR 291
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f. Details of all adjustments made to the quarterly installments; 1
g. An explanation that the quarterly installment amounts may 2
increase or decrease in order to reflect the actual assessed value 3
of the property and the tax rates for the assessment year; and 4
h. An explanation of the duties of the eligible taxpayer under the 5
quarterly installment payment program. 6
(d) The preferred method for providing information, sending notices, and 7
communicating with eligible taxpayers, and receipt of payments for the 8
quarterly installment payment program shall be through use of an 9
electronic, web-based system. However, in recognition that some designated 10
property tax collectors and some eligible taxpayers may lack the technology 11
necessary to use this method, the department shall establish alternative 12
methods for the provision of information, sending of notices, and receipt of 13
payments to ensure that the quarterly installment payment program is 14
widely available. 15
(6) The designated property tax collector shall be entitled to an administrative fee for 16
each quarterly installment collected. The fee shall: 17
(a) Be paid by each eligible taxpayer that participates in the quarterly 18
installment payment program; 19
(b) Be separately stated and clearly identified as an administrative fee in the 20
eligible taxpayer's quarterly installment; and 21
(c) Not exceed three percent (3%) of the total taxes due. 22
(7) (a) The two percent (2%) discount for the early payment of property taxes as 23
provided by Section 3 of this Act shall not apply to taxes paid under a 24
quarterly installment payment program. 25
(b) Penalties and interest shall not be assessed by a designated property tax 26
collector for late payments received under a quarterly installment payment 27 UNOFFICIAL COPY 23 RS BR 291
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program. Penalties, interest, and collection processes shall apply in 1
accordance with this chapter to property taxes that become delinquent after 2
the due date established by Section 3 of this Act. 3
(8) The department shall, through the promulgation of administrative regulations in 4
accordance with KRS Chapter 13A, establish guidelines, conditions, and 5
standards for quarterly installment payment programs to ensure uniformity in the 6
administration by designated tax collectors and to ensure that the program will be 7
available statewide. The administrative regulations shall include but not be 8
limited to the following: 9
(a) Accounting and tracking procedures for installment payments to ensure 10
that payments are clearly identified and associated with a specific parcel; 11
(b) A process for setting the administrative fee permitted by subsection (6) of 12
this section; 13
(c) Alternative enrollment options for eligible taxpayers; 14
(d) Any forms necessary for administration of the quarterly installment 15
payment program; 16
(e) Conditions under which a taxpayer may be ineligible for or rejected from 17
the program, and any appeal rights a taxpayer who is deemed ineligible or 18
rejected from the program may have; 19
(f) The processes for collection, distribution, handling, and refunding of 20
property taxes collected under the program; 21
(g) The process for determining when an installment payment plan is in 22
default, and the processes and procedures for addressing the default; 23
(h) The requirements for the electronic systems that provide eligible taxpayers 24
access to their property tax information; 25
(i) Details on the information that shall be posted on the designated property 26
tax collector's website or the county's website; 27 UNOFFICIAL COPY 23 RS BR 291
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(j) The processes in providing notices to eligible taxpayers and accepting 1
payments under the quarterly installment payment program; and 2
(k) Any other requirements the department determines necessary for the 3
quarterly installment payment program to operate in an efficient, 4
transparent, and accessible manner. 5
(9) The department shall make available on its website information about installment 6
payment plans with contact information for each designated tax collector. 7
(10) Any designated property tax collector who does not comply with this section and 8
any administrative regulations promulgated for quarterly installment programs 9
shall be subject to penalties in KRS 134.990. 10
Section 2. KRS 133.220 is amended to read as follows: 11
(1) The department annually shall furnish to each county clerk tax bill forms designed 12
for adequate accounting control sufficient to cover the taxable property on the rolls. 13
(2) After receiving the forms, the county clerk shall prepare for the use of the sheriff or 14
collector a correct tax bill for each taxpayer in the county whose property has been 15
assessed and whose valuation is included in the certification provided in KRS 16
133.180. If the bills are bound, the cost of binding shall be paid out of the county 17
levy. Each tax bill shall show the rate of tax upon each one hundred dollars ($100) 18
worth of property for state, county, and school purposes; the name of the taxpayer 19
and his or her mailing address; the number of acres of farm land and its value; the 20
number of lots and their value; the amount and value of notes and money; the value 21
of mixed personal property; the total amount of taxes due the state, county, school 22
district, and any other taxing district for which the sheriff collects taxes; and shall 23
include a statement that notifies the taxpayer that costs and fees increase 24
substantially if the taxes become delinquent. Provision shall be made for the sheriff 25
to have a stub, duplicate, or other proper evidence of receipt of payment of each tax 26
bill. 27 UNOFFICIAL COPY 23 RS BR 291
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(3) Tax bills prepared in accordance with the certification of the department shall be 1
delivered to the sheriff or collector by the county clerk before September 15 of each 2
year. The clerk shall take a receipt showing the number of tax bills and the total 3
amount of tax due each taxing district as shown upon the tax bills. The receipt shall 4
be signed and acknowledged by the sheriff or collector before the county clerk, 5
filed with the county judge/executive, and recorded in the order book of the county 6
judge/executive in the manner required by law for recording the official bond of the 7
sheriff. 8
(4) (a) Upon delivery to him or her of the tax bills, the sheriff or collector shall mail 9
a notice to each taxpayer, showing the total amount of taxes due the state, 10
county, school district, and any other taxing district for which the sheriff 11
collects taxes, the date on which the taxes are due, and any discount to which 12
the taxpayer may be entitled upon payment of the taxes prior to a designated 13
date. The sheriff shall not mail tax notices prior to September 15. 14
(b) For taxpayers that participate in a quarterly installment payment program 15
as permitted by Section 1 of this Act, the sheriff or collector shall include in 16
with the taxpayer's tax notice a statement that provides the: 17
1. Total estimated assessment used in calculating the installment 18
payments; 19
2. Total payments made by the taxpayer to date; 20
3. Actual assessment for the assessment year; 21
4. Difference between the estimated and actual assessment for the 22
assessment year; and 23
5. Amount due under the remaining installments once adjusted to reflect 24
the actual assessment for the assessment year. 25
(5) All notices returned as undeliverable shall be submitted no later than the following 26
work day to the property valuation administrator. The property valuation 27 UNOFFICIAL COPY 23 RS BR 291
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administrator shall correct inadequate or erroneous addresses if the information to 1
do so is available and, if property has been transferred, shall determine the new 2
owner and the current mailing address, or the in-care-of address reflected in the 3
deed as required by KRS 382.135. The property valuation administrator shall return 4
the corrected notices to the sheriff or collector on a daily basis as corrections are 5
made, but no later than fifteen (15) days after receipt. Uncorrected notices shall be 6
submitted to the department by the property valuation administrator. 7
Section 3. KRS 134.015 is amended to read as follows: 8
(1) All property taxes are due and payable on or before December 31 of the assessment 9
year except as otherwise provided by law. Payment shall be made to the sheriff as 10
provided in KRS 134.119 unless otherwise provided by law. 11
(2) (a) Any taxpayer, except taxpayers paying under a quarterly installment 12
program established by Section 1 of this Act, who pays the property taxes in 13
full by November 1 of the assessment year shall receive a two percent (2%) 14
discount on the amount otherwise due. 15
(b) Taxes paid in full between November 2 and December 31 of the assessment 16
year shall be paid at the amount reflected on the tax bill without discount or 17
penalty. 18
(c) Taxes paid in full between January 1 and January 31 of the year following the 19
assessment year shall be subject to a penalty of five percent (5%) of the taxes 20
due and unpaid. 21
(d) Taxes paid after January 31 of the year following the assessment year shall be 22
subject to a penalty of ten percent (10%) of the taxes due and unpaid. 23
(3) If the regular collection schedule established by subsections (1) and (2) of this 24
section is delayed, the department may establish an alternative collection schedule. 25
Taxes shall be due two (2) full months from the date the tax bills are mailed. The 26
alternative collection schedule shall allow a two percent (2%) discount for all tax 27 UNOFFICIAL COPY 23 RS BR 291
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bills paid in full within one (1) full month of the date the tax bills were mailed, 1
except for the taxes paid under a quarterly installment program established by 2
Section 1 of this Act. Upon expiration of the discount period, the face amount 3
reflected on the tax bill without discount or penalty shall be due for the next full 4
month. Payments made within one (1) month following the face amount period 5
shall be subject to a penalty of five percent (5%) of the taxes due and unpaid. 6
Payments made after the five percent (5%) penalty period shall be subject to a 7
penalty of ten percent (10%) of the taxes due and unpaid. 8
(4) All taxes due under this section and all fees, penalties, and interest thereon are a 9
personal debt of the taxpayer on the assessment date, from the time the tax becomes 10
due until paid. 11
(5) The lien that attaches to property on which taxes have become delinquent under 12
KRS 134.420 shall continue as provided in KRS 134.420, from the time the taxes 13
become delinquent until the taxes are paid or the eleven (11) year period established 14
by KRS 134.420 expires, regardless of who owns the property. 15
(6) A tax bill issued against omitted property, or an increase in valuation over that 16
claimed by the taxpayer, as finally determined upon appeal as provided for in KRS 17
133.120, shall be due the day the bill is prepared and shall be considered delinquent 18
on that date. If the tax bill is not paid within one (1) full month of the due date, an 19
additional penalty of ten percent (10%) of the tax, fees, penalties, and interest due 20
shall be added to the tax bill. The laws relating to delinquent taxes on the same 21
class of property or taxpayers involved shall apply to delinquent omitted tax bills 22
unless otherwise provided by law. 23