In accordance with state regulations, the Kentucky Department of Revenue is required to conduct an annual evaluation of the interest rates applicable to tax liabilities.
This year, Commissioner Thomas B. Miller has confirmed a new tax interest rate effective January 1, 2025. The updated rate has been set at 8%, reflecting a decrease from the previous year’s rate.
For taxpayers, this means that any outstanding taxes owed to the Commonwealth, which are unpaid by the designated deadline, will now incur interest at a rate of 10%, as stipulated under KRS 131.183(2)(a)2.
On the other hand, interest on overpayments will be calculated at a rate of 6%, in accordance with KRS 131.183(2)(b)2.
This adjustment impacts both individual and corporate taxpayers, emphasizing the importance of timely tax payments and the potential benefits of addressing overpayments swiftly.
Stay informed about these changes to effectively manage your tax obligations and explore avenues for any applicable refunds.
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