2013 Kentucky Revised Statutes CHAPTER 67 - COUNTY GOVERNMENT (FISCAL COURTS AND COUNTY COMMISSIONERS) 67.753 Apportionment of net profit or gross receipts of business entity to local tax district.
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67.753 Apportionment of net profit or gross receipts of business entity to
local tax district.
(1)
(2)
(3)
(4)
Except as provided in subsection (4) of this section, net profit or gross receipts
shall be apportioned as follows:
(a) For business entities with both payroll and sales revenue in more than
one (1) tax district, by multiplying the net profit or gross receipts by a
fraction, the numerator of which is the payroll factor, described in
subsection (2) of this section, plus the sales factor, described in
subsection (3) of this section, and the denominator of which is two (2);
and
(b) For business entities with sales revenue in more than one (1) tax district,
by multiplying the net profits or gross receipts by the sales factor as set
forth in subsection (3) of this section.
The payroll factor is a fraction, the numerator of which is the total amount paid
or payable in the tax district during the tax period by the business entity for
compensation, and the denominator of which is the total compensation paid or
payable by the business entity everywhere during the tax period.
Compensation is paid or payable in the tax district based on the time the
individual's service is performed within the tax district.
The sales factor is a fraction, the numerator of which is the total sales revenue
of the business entity in the tax district during the tax period, and the
denominator of which is the total sales revenue of the business entity
everywhere during the tax period.
(a) The sale, lease, or rental of tangible personal property is in the tax district
if:
1.
The property is delivered or shipped to a purchaser, other than the
United States government, or to the designee of the purchaser
within the tax district regardless of the f.o.b. point or other conditions
of the sale; or
2.
The property is shipped from an office, store, warehouse, factory, or
other place of storage in the tax district and the purchaser is the
United States government.
(b) Sales revenues, other than revenue from the sale, lease, or rental of
tangible personal property or the lease or rental of real property, are
apportioned to the tax district based upon a fraction, the numerator of
which is the time spent in performing such income-producing activity
within the tax district and the denominator of which is the total time spent
performing that income-producing activity.
(c) Sales revenue from the lease or rental of real property is allocated to the
tax district where the property is located.
If the apportionment provisions of this section do not fairly represent the extent
of the business entity's activity in the tax district, the business entity may
petition the tax district or the tax district may require, in respect to all or any
part of the business entity's business activity, if reasonable:
(a) Separate accounting;
(b)
(c)
(d)
The exclusion of any one (1) or more of the factors;
The inclusion of one (1) or more additional factors which will fairly
represent the business entity's business activity in the tax district; or
The employment of any other method to effectuate an equitable allocation
and apportionment of net profit or gross receipts.
Effective:July 13, 2004
History: Amended 2004 Ky. Acts ch. 63, sec. 2, effective July 13, 2004. -- Created
2003 Ky. Acts ch. 117, sec. 2, effective June 24, 2003.
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