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House Bill Proposes to Establish a Centralized Statute for Processing Electronically Filed Returns

02.24.2010

Legislation recently introduced in the Kentucky General Assembly would, if passed, establish a centralized statute for the administration of electronically filed returns and require certain tax return preparers to electronically file.

House Bill (“H.B.”) 319, which was introduced by Representatives Mike Denham (D) and Rick Rand (D), would amend KRS 131.010 to add definitions of “electronic fund transfer” (which would be moved from its current location in KRS 131.155) and “specified tax return preparer” (which would be defined by reference to the same term in section 6011(e)(3) of the Internal Revenue Code of 1986, as amended).

H.B. 319 would also create a new section of KRS Chapter 131, which would establish a centralized statute for the administration of electronically filed returns and would require that returns filed by a specified tax return preparer must be electronically filed.  It would also amend KRS 131.990 to add a penalty for failing or refusing to electronically file a return as required.

Additionally, the proposed legislation would amend KRS 131.155 to set forth the types of payments which would be required to be made through electronic fund transfers.  Included in the legislation is a repeal of KRS 160.6145, which currently authorizes the Department of Revenue to develop administrative regulations regarding waivers of otherwise required electronic filing and payments of utility gross receipts license taxes.  The Department’s authority with regard to such waivers would instead be provided for in the new section of KRS Chapter 131.  The Department has reported that an estimated $5,000,000 of administrative expenses would be saved per year upon full implementation of H.B. 319.

H.B. 319 had its first reading on February 23, 2010 and it was reported favorably. 

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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