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AN ACT relating to the employer student loan repayment credit. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. A NEW SECTION OF KRS CHAPTER 141 IS CREATED TO 3
READ AS FOLLOWS: 4
(1) As used in this section: 5
(a) "Eligible student loan" means any advance of money that is to be used 6
exclusively for payment of education expenses, evidenced by a promissory 7
note or similar instrument requiring payment under specified conditions, 8
made to an eligible borrower who is qualified under the Higher Education 9
Act of 1965, Pub. L. No. 89-329, as amended, and issued by: 10
1. The Kentucky Higher Education Assistance Authority; 11
2. The Kentucky Higher Education Student Loan Corporation; or 12
3. Any other private or governmental lender; 13
(b) "Qualified employee" means any individual who: 14
1. Resides and works in this state; 15
2. Earned his or her first bachelor's degree from an institution of higher 16
education in the immediately preceding five (5) year period; 17
3. Is employed at least thirty-five (35) hours per week; 18
4. Is not an owner, member, or partner of the employer company or a 19
family member of an owner, member, or partner of the employer 20
company; and 21
5. Has received an eligible student loan; and 22
(c) "Qualified employer" means any company doing business in this state and 23
subject to taxation under KRS 141.020 or 141.040 and 141.0401. 24
(2) (a) For taxable years beginning on or after January 1, 2025, but prior to 25
January 1, 2029, the employer student loan repayment credit shall be 26
available for qualified employers making a payment to an eligible student 27 UNOFFICIAL COPY 25 RS BR 1244
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loan on behalf of one (1) or more of their qualified employees. 1
(b) The credit: 2
1. Shall be nonrefundable and nontransferable; 3
2. Shall not be carried forward; 4
3. May be claimed against the tax imposed under KRS 141.020 or 5
141.040 and 141.0401, with the ordering of the credit as prescribed in 6
Section 2 of this Act; and 7
4. Shall be equal to fifty percent (50%) of the repayment amount made to 8
the outstanding principal balance of the eligible student loan during 9
the taxable year. 10
(3) Claims for the credit shall be documented on the applicable tax return of the 11
employer in the manner specified by the department, including but not limited to 12
the following information: 13
(a) The employer's name, tax identification number, and address; 14
(b) The employee's name, Social Security number, and eligible student loan 15
information; and 16
(c) The amount of repayment made for each employee for the taxable year in 17
which the credit is being claimed. 18
(4) In order for the General Assembly to evaluate the effectiveness of the employer 19
student loan repayment tax credit, the department shall report the following 20
information to the Interim Joint Committee on Appropriations and Revenue on 21
or before December 1, 2026, and on or before each December 1 thereafter, as 22
long as the credit is claimed on a tax return: 23
(a) The number of returns claiming the employer student loan repayment 24
credit; 25
(b) The total amount of credit claimed for each taxable year; and 26
(c) 1. In the case of all taxpayers other than corporations, based on ranges 27 UNOFFICIAL COPY 25 RS BR 1244
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of adjusted gross income of no larger than five thousand dollars 1
($5,000) for the taxable year, the total amount of credit claimed and 2
the number of returns claiming a credit for each adjusted gross 3
income range; and 4
2. In the case of all corporations, based on ranges of net income no 5
larger than fifty thousand dollars ($50,000) for the taxable year, the 6
total amount of credit claimed and the number of returns claiming a 7
credit for each net income range. 8
Section 2. KRS 141.0205 is amended to read as follows: 9
If a taxpayer is entitled to more than one (1) of the tax credits allowed against the 10
tax imposed by KRS 141.020, 141.040, and 141.0401, the priority of application and use 11
of the credits shall be determined as follows: 12
(1) The nonrefundable business incentive credits against the tax imposed by KRS 13
141.020 shall be taken in the following order: 14
(a) The limited liability entity tax credit permitted by KRS 141.0401; 15
(b) The economic development credits computed under KRS 141.347, 141.381, 16
141.384, 141.3841, 141.400, 141.403, 141.407, 141.415, 154.12-207, and 17
154.12-2088; 18
(c) The qualified farming operation credit permitted by KRS 141.412; 19
(d) The certified rehabilitation credit permitted by KRS 171.397(1)(a); 20
(e) The health insurance credit permitted by KRS 141.062; 21
(f) The tax paid to other states credit permitted by KRS 141.070; 22
(g) The credit for hiring the unemployed permitted by KRS 141.065; 23
(h) The recycling or composting equipment credit permitted by KRS 141.390; 24
(i) The [tax ]credit for cash contributions in investment funds permitted by KRS 25
154.20-263 in effect prior to July 15, 2002, and the credit permitted by KRS 26
154.20-258; 27 UNOFFICIAL COPY 25 RS BR 1244
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(j) The research facilities credit permitted by KRS 141.395; 1
(k) The employer High School Equivalency Diploma program incentive credit 2
permitted under KRS 151B.402; 3
(l) The voluntary environmental remediation credit permitted by KRS 141.418; 4
(m) The biodiesel and renewable diesel credit permitted by KRS 141.423; 5
(n) The clean coal incentive credit permitted by KRS 141.428; 6
(o) The ethanol credit permitted by KRS 141.4242; 7
(p) The cellulosic ethanol credit permitted by KRS 141.4244; 8
(q) The energy efficiency credits permitted by KRS 141.436; 9
(r) The railroad maintenance and improvement credit permitted by KRS 141.385; 10
(s) The Endow Kentucky credit permitted by KRS 141.438; 11
(t) The New Markets Development Program credit permitted by KRS 141.434; 12
(u) The distilled spirits credit permitted by KRS 141.389; 13
(v) The angel investor credit permitted by KRS 141.396; 14
(w) The film industry credit permitted by KRS 141.383 for applications approved 15
on or after April 27, 2018, but before January 1, 2022; 16
(x) The inventory credit permitted by KRS 141.408; 17
(y) The renewable chemical production credit permitted by KRS 141.4231;[ and] 18
(z) The qualified broadband investment[ tax] credit permitted by KRS 141.391; 19
and 20
(aa) The employer student loan repayment credit permitted by Section 1 of this 21
Act; 22
(2) After the application of the nonrefundable credits in subsection (1) of this section, 23
the nonrefundable personal tax credits against the tax imposed by KRS 141.020 24
shall be taken in the following order: 25
(a) The individual credits permitted by KRS 141.020(3); 26
(b) The credit permitted by KRS 141.066; 27 UNOFFICIAL COPY 25 RS BR 1244
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(c) The tuition credit permitted by KRS 141.069; 1
(d) The household and dependent care credit permitted by KRS 141.067; 2
(e) The income gap credit permitted by KRS 141.066; and 3
(f) The Education Opportunity Account Program [tax ]credit permitted by KRS 4
141.522; 5
(3) After the application of the nonrefundable credits provided for in subsection (2) of 6
this section, the refundable credits against the tax imposed by KRS 141.020 shall be 7
taken in the following order: 8
(a) The individual withholding tax credit permitted by KRS 141.350; 9
(b) The individual estimated tax payment credit permitted by KRS 141.305; 10
(c) The certified rehabilitation credit permitted by KRS 171.3961, 171.3963, and 11
171.397(1)(b); 12
(d) The film industry [tax ]credit permitted by KRS 141.383 for applications 13
approved prior to April 27, 2018, or on or after January 1, 2022; 14
(e) The development area [tax ]credit permitted by KRS 141.398; 15
(f) The decontamination [tax ]credit permitted by KRS 141.419; and 16
(g) The pass-through entity tax credit permitted by KRS 141.209; 17
(4) The nonrefundable credit permitted by KRS 141.0401 shall be applied against the 18
tax imposed by KRS 141.040; 19
(5) The following nonrefundable credits shall be applied against the sum of the tax 20
imposed by KRS 141.040 after subtracting the credit provided for in subsection (4) 21
of this section, and the tax imposed by KRS 141.0401 in the following order: 22
(a) The economic development credits computed under KRS 141.347, 141.381, 23
141.384, 141.3841, 141.400, 141.403, 141.407, 141.415, 154.12-207, and 24
154.12-2088; 25
(b) The qualified farming operation credit permitted by KRS 141.412; 26
(c) The certified rehabilitation credit permitted by KRS 171.397(1)(a); 27 UNOFFICIAL COPY 25 RS BR 1244
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(d) The health insurance credit permitted by KRS 141.062; 1
(e) The unemployment credit permitted by KRS 141.065; 2
(f) The recycling or composting equipment credit permitted by KRS 141.390; 3
(g) The coal conversion credit permitted by KRS 141.041; 4
(h) The enterprise zone credit permitted by KRS 154.45-090, for taxable periods 5
ending prior to January 1, 2008; 6
(i) The [tax ]credit for cash contributions to investment funds permitted by KRS 7
154.20-263 in effect prior to July 15, 2002, and the credit permitted by KRS 8
154.20-258; 9
(j) The research facilities credit permitted by KRS 141.395; 10
(k) The employer High School Equivalency Diploma program incentive credit 11
permitted by KRS 151B.402; 12
(l) The voluntary environmental remediation credit permitted by KRS 141.418; 13
(m) The biodiesel and renewable diesel credit permitted by KRS 141.423; 14
(n) The clean coal incentive credit permitted by KRS 141.428; 15
(o) The ethanol credit permitted by KRS 141.4242; 16
(p) The cellulosic ethanol credit permitted by KRS 141.4244; 17
(q) The energy efficiency credits permitted by KRS 141.436; 18
(r) The ENERGY STAR home or ENERGY STAR manufactured home credit 19
permitted by KRS 141.437; 20
(s) The railroad maintenance and improvement credit permitted by KRS 141.385; 21
(t) The railroad expansion credit permitted by KRS 141.386; 22
(u) The Endow Kentucky credit permitted by KRS 141.438; 23
(v) The New Markets Development Program credit permitted by KRS 141.434; 24
(w) The distilled spirits credit permitted by KRS 141.389; 25
(x) The film industry credit permitted by KRS 141.383 for applications approved 26
on or after April 27, 2018, but before January 1, 2022; 27 UNOFFICIAL COPY 25 RS BR 1244
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(y) The inventory credit permitted by KRS 141.408; 1
(z) The renewable chemical production [tax ]credit permitted by KRS 141.4231; 2
(aa) The Education Opportunity Account Program [tax ]credit permitted by KRS 3
141.522;[ and] 4
(ab) The qualified broadband investment [tax ]credit permitted by KRS 141.391; 5
and 6
(ac) The employer student loan repayment credit permitted by Section 1 of this 7
Act; and 8
(6) After the application of the nonrefundable credits in subsection (5) of this section, 9
the refundable credits shall be taken in the following order: 10
(a) The corporation estimated tax payment credit permitted by KRS 141.044; 11
(b) The certified rehabilitation credit permitted by KRS 171.3961, 171.3963, and 12
171.397(1)(b); 13
(c) The film industry [tax ]credit permitted by KRS 141.383 for applications 14
approved prior to April 27, 2018, or on or after January 1, 2022; 15
(d) The decontamination [tax ]credit permitted by KRS 141.419; and 16
(e) The pass-through entity tax credit permitted by KRS 141.209. 17
Section 3. KRS 131.190 is amended to read as follows: 18
(1) No present or former commissioner or employee of the department, present or 19
former member of a county board of assessment appeals, present or former property 20
valuation administrator or employee, present or former secretary or employee of the 21
Finance and Administration Cabinet, former secretary or employee of the Revenue 22
Cabinet, or any other person, shall intentionally and without authorization inspect 23
or divulge any information acquired by him or her of the affairs of any person, or 24
information regarding the tax schedules, returns, or reports required to be filed with 25
the department or other proper officer, or any information produced by a hearing or 26
investigation, insofar as the information may have to do with the affairs of the 27 UNOFFICIAL COPY 25 RS BR 1244
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person's business. 1
(2) The prohibition established by subsection (1) of this section shall not extend to: 2
(a) Information required in prosecutions for making false reports or returns of 3
property for taxation, or any other infraction of the tax laws; 4
(b) Any matter properly entered upon any assessment record, or in any way made 5
a matter of public record; 6
(c) Furnishing any taxpayer or his or her properly authorized agent with 7
information respecting his or her own return; 8
(d) Testimony provided by the commissioner or any employee of the department 9
in any court, or the introduction as evidence of returns or reports filed with the 10
department, in an action for violation of state or federal tax laws or in any 11
action challenging state or federal tax laws; 12
(e) Providing an owner of unmined coal, oil or gas reserves, and other mineral or 13
energy resources assessed under KRS 132.820, or owners of surface land 14
under which the unmined minerals lie, factual information about the owner's 15
property derived from third-party returns filed for that owner's property, under 16
the provisions of KRS 132.820, that is used to determine the owner's 17
assessment. This information shall be provided to the owner on a confidential 18
basis, and the owner shall be subject to the penalties provided in KRS 19
131.990(2). The third-party filer shall be given prior notice of any disclosure 20
of information to the owner that was provided by the third-party filer; 21
(f) Providing to a third-party purchaser pursuant to an order entered in a 22
foreclosure action filed in a court of competent jurisdiction, factual 23
information related to the owner or lessee of coal, oil, gas reserves, or any 24
other mineral resources assessed under KRS 132.820. The department may 25
promulgate an administrative regulation establishing a fee schedule for the 26
provision of the information described in this paragraph. Any fee imposed 27 UNOFFICIAL COPY 25 RS BR 1244
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shall not exceed the greater of the actual cost of providing the information or 1
ten dollars ($10); 2
(g) Providing information to a licensing agency, the Transportation Cabinet, or 3
the Kentucky Supreme Court under KRS 131.1817; 4
(h) Statistics of gasoline and special fuels gallonage reported to the department 5
under KRS 138.210 to 138.448; 6
(i) Providing any utility gross receipts license tax return information that is 7
necessary to administer the provisions of KRS 160.613 to 160.617 to 8
applicable school districts on a confidential basis; 9
(j) Providing documents, data, or other information to a third party pursuant to an 10
order issued by a court of competent jurisdiction; 11
(k) Publishing administrative writings on its official website in accordance with 12
KRS 131.020(1)(b); or 13
(l) Providing information to the Legislative Research Commission under: 14
1. KRS 139.519 for purposes of the sales and use tax refund on building 15
materials used for disaster recovery; 16
2. KRS 141.436 for purposes of the energy efficiency products credits; 17
3. KRS 141.437 for purposes of the ENERGY STAR home and the 18
ENERGY STAR manufactured home credits; 19
4. KRS 141.383 for purposes of the film industry incentives; 20
5. KRS 154.26-095 for purposes of the Kentucky industrial revitalization 21
credit[tax credits] and the job assessment fees; 22
6. KRS 141.068 for purposes of the Kentucky investment fund; 23
7. KRS 141.396 for purposes of the angel investor [tax ]credit; 24
8. KRS 141.389 for purposes of the distilled spirits credit; 25
9. KRS 141.408 for purposes of the inventory credit; 26
10. KRS 141.390 for purposes of the recycling and composting 27 UNOFFICIAL COPY 25 RS BR 1244
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credits[credit]; 1
11. KRS 141.3841 for purposes of the selling farmer [tax ]credit; 2
12. KRS 141.4231 for purposes of the renewable chemical production [tax 3
]credit; 4
13. KRS 141.524 for purposes of the Education Opportunity Account 5
Program [tax ]credit; 6
14. KRS 141.398 for purposes of the development area [tax ]credit; 7
15. KRS 139.516 for [the ]purposes of the sales and use tax exemptions 8
for[exemption on] the commercial mining of cryptocurrency; 9
16. KRS 141.419 for purposes of the decontamination [tax ]credit; 10
17. KRS 141.391 for purposes of the qualified broadband investment [tax 11
]credit;[ and] 12
18. KRS 139.499 for purposes of the sales and use tax exemptions[tax 13
exemption] for a qualified data center project; and 14
19. Section 1 of this Act for purposes of the employer student loan 15
repayment credit. 16
(3) The commissioner shall make available any information for official use only and on 17
a confidential basis to the proper officer, agency, board or commission of this state, 18
any Kentucky county, any Kentucky city, any other state, or the federal 19
government, under reciprocal agreements whereby the department shall receive 20
similar or useful information in return. 21
(4) Access to and inspection of information received from the Internal Revenue Service 22
is for department use only, and is restricted to tax administration purposes. 23
Information received from the Internal Revenue Service shall not be made available 24
to any other agency of state government, or any county, city, or other state, and 25
shall not be inspected intentionally and without authorization by any present 26
secretary or employee of the Finance and Administration Cabinet, commissioner or 27 UNOFFICIAL COPY 25 RS BR 1244
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employee of the department, or any other person. 1
(5) Statistics of crude oil as reported to the department under the crude oil excise tax 2
requirements of KRS Chapter 137 and statistics of natural gas production as 3
reported to the department under the natural resources severance tax requirements 4
of KRS Chapter 143A may be made public by the department by release to the 5
Energy and Environment Cabinet, Department for Natural Resources. 6
(6) Notwithstanding any provision of law to the contrary, beginning with mine-map 7
submissions for the 1989 tax year, the department may make public or divulge only 8
those portions of mine maps submitted by taxpayers to the department pursuant to 9
KRS Chapter 132 for ad valorem tax purposes that depict the boundaries of mined-10
out parcel areas. These electronic maps shall not be relied upon to determine actual 11
boundaries of mined-out parcel areas. Property boundaries contained in mine maps 12
required under KRS Chapters 350 and 352 shall not be construed to constitute land 13
surveying or boundary surveys as defined by KRS 322.010 and any administrative 14
regulations promulgated thereto. 15