Kentucky Response to Bonus Depreciation

From STT, 4/25/02:

On April 15, the last day of the regular session, the Kentucky General Assembly passed HB 457, which would update the Internal Revenue Code reference in KRS 141.010(3) for Kentucky's income tax to December 31, 2001.

Amendments to HB 457 clarify that the change would be effective as of January 1, 2002. KRS 141.010(3) currently refers to the Internal Revenue Code as in effect on December 31, 1999 -- before the passage of the Economic Growth and Tax Relief Reconciliation Act of 2001. The passage of HB 457 relieved many practitioners who had worried about the effect of incongruities between federal and Kentucky tax law -- particularly in the context of pension and retirement benefits. Gov. Paul Patton (D) is likely to sign HB 457.

The General Assembly earlier passed HB 531, which updated the Internal Revenue Code reference date in KRS 136.500 for the bank franchise tax. The governor signed HB 531 on April 8.