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Governor’s State Budget Address Reveals Plans for Tax Amnesty


With the Commonwealth facing serious budget concerns, the state budget and tax reform have been the focus for lawmakers during the 2012 Regular Session, which convened on January 3, 2012.

On January 17, 2012, amidst the 2012 Regular Session, Governor Steve Beshear gave his State Budget Address to the Commonwealth. Therein, Governor Beshear laid out five “keys” to balancing his proposed state budget – the fourth of which revealed plans for a tax amnesty program in Kentucky.

The Governor stated, “[W]e are aggressively pursuing people who owe taxes or try to avoid paying them. As part of a new emphasis on compliance, we will hold Kentucky’s first tax amnesty program in 10 years.” The Governor further stated that the Commonwealth expects to net $61 million from such a tax amnesty.

Despite the Governor’s statement that this would be Kentucky’s first tax amnesty program in 10 years, in 2010, the Commonwealth implemented an Expedited Protest Resolution which was, in effect, a limited tax amnesty.

The 2010 Budget Bill provided for a procedure known as “Expedited Protest Resolution” which was available for any tax assessment that had been protested by January 19, 2010 and was not the subject of a Final Ruling issued by the Kentucky Department of Revenue. Taxpayers had the opportunity to satisfy a qualifying assessment in full by paying the tax only – no interest or penalty – on or before June 15, 2010. All payments of tax made pursuant to this “tax amnesty” were final and not be subject to refund.

If you have questions about this topic or any other legal issue, please contact any member of the firm's State and Local Tax Team.

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