Kentucky: Sales Tax Handbook
How to appeal a sales tax audit or penalty in Kentucky
In Kentucky, the Department of Revenue will frequently audit business sales tax returns and may issue penalties or punishments for tardy filing, incorrect reporting, willful omissions, or other violations. Penalties can range from fines to revocation of your sales tax permit depending on the infraction.
If you disagree with a penalty or ruling made by the Kentucky Department of Revenue, you have several options you can pursue in appealing their decision. This page contains basic guidelines for appealing to the Department of Revenue, to an administrative appeal body, and through the courts.
Sales Tax Statute of Limitations in Kentucky
In sales tax law, the "statute of limitations" is the maximum amount of time state authorities have to investigate and begin potential audit or prosecution related to a a filed Kentucky sales tax return in the event of underpayment, incorrect reportings, etc. The Department of Revenue cannot begin an audit or issue a penalty after this timeframe.
The statute of limitations in Kentcky is four years from the later of either return filing date or the return due date.
Appealing to the Department of Revenue in Kentucky
If you do not agree with a penalty or decision made by the Kentucky Department of Revenue, you have the right to file an appeal and ask for reconsideration. In the case of a department appeal, an official petition must be filed with the Revenue Cabinet within the fourty five days days after date of notice of assessmentTop
Administrative Sales Tax Appeals in Kentucky
In the case of administrative appeal, an official podyetition must be filed with Board of Tax Appeals within thirty days after date of decision has been setTop
Judicial Sales Tax Appeals in Kentucky
If all other appeal avenues fail, businesses can make a final appeal in the state court system. The notice of appeal must be filed with the Board of Tax Appeals within thirty days of the final order. Statement of appeal must be filed with the Circuit Court within thirty days after notice of appeal is filed
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