Introduced

Passed House

Passed Senate

Became law

Adjourned sine die. The bill was pending when the session ended, so it did not pass.

Last action · February 4, 2025

To Appropriations & Revenue (H)

Introduced January 7, 2025

House

Adjourned Sine Die

2025 Regular Session

HB26

AN ACT relating to individual income tax exclusions.

Amend KRS 141.010 to define "tips" and "overtime compensation"; amend KRS 141.019 to allow an exclusion from gross income for tax purposes for tips and overtime compensation; amend KRS 141.335 to include tips and overtime compensation amounts on employee withholding statement; amend KRS 131.190 to allow the Department of Revenue to report on the exclusions.

Labor and Industry Taxation Taxation, Income--Individual Wages and Hours Reports Mandated Workforce Fiscal Note

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This bill would allow Kentucky workers to exclude tips and overtime pay from their state income taxes, meaning those earnings would not be counted as taxable income. It also requires employers to report tip and overtime amounts on employee withholding statements and allows the Department of Revenue to report on how the exclusions are being used. Who it may affect: workers who earn tips or overtime pay, such as those in service industries, hospitality, and hourly wage jobs, as well as their employers.

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