KRS § 141.201 — KY Code / Title XI / Chapter 141 / Section 141.201
141.201 Corporation returns -- Election of affiliated groups to file consolidated returns -- Taxable years beginning on or after January 1, 2019
Status: in_force

141.201 Corporation returns -- Election of affiliated groups to file consolidated

returns -- Taxable years beginning on or after January 1, 2019.

(1) This section shall apply to taxable years beginning on or after January 1, 2019.

(2) As used in this section:

(a) "Affiliated group" means affiliated group as defined in Section 1504(a) of the

Internal Revenue Code and related regulations;

(b) "Consolidated return" means a Kentucky corporation income tax return filed

by members of an affiliated group in accordance with this section;

(c) "Separate return" means a Kentucky corporation income tax return in which

only the transactions and activities of a single corporation are considered in

making all determinations and computations necessary to calculate taxable net

income, tax due, and credits allowed in accordance with this chapter;

(d) "Corporation" means "corporation" as defined in Section 7701(a)(3) of the

Internal Revenue Code; and

(e) "Election period" means the forty-eight (48) month period provided for in

subsection (4)(d) of this section.

(3) Every corporation doing business in this state, except those corporations listed as

exempt from taxation under KRS 141.040(1)(a) and (b), shall, for each taxable year:

(a) 1. File a combined report, if the corporation is a member of unitary

business group as provided in KRS 141.202; or

2. Make an election to file a consolidated return with all members of the

affiliated group as provided in this section; or

(b) File a separate return, if paragraph (a) of this subsection does not apply.

(4) (a) An affiliated group, whether or not filing a federal consolidated return, may

elect to file a consolidated return which includes all members of the affiliated

group.

(b) 1. An affiliated group electing to file a consolidated return under paragraph

(a) of this subsection shall be treated for all purposes as a single

corporation under this chapter.

2. The determinations and computations required by this chapter shall be

made in accordance with Section 1502 of the Internal Revenue Code and

related regulations, except as required by differences between this

chapter and the Internal Revenue Code.

3. Corporations listed as exempt from taxation under KRS 141.040(1)(a)

and (b) shall not be included in the return.

4. All transactions between corporations included in the consolidated

return shall be eliminated in computing net income as provided in KRS

141.039(2), and determining the apportionment fraction in accordance

with KRS 141.120.

(c) Any election made in accordance with paragraph (a) of this subsection shall be

made on a form prescribed by the department and shall be submitted to the

department on or before the due date of the return, including extensions, for

the first taxable year for which the election is made.

(d) Any election to file a consolidated return pursuant to paragraph (a) of this

subsection shall be binding on both the department and the affiliated group for

a period beginning with the first month of the first taxable year for which the

election is made and ending with the conclusion of the taxable year in which

the forty-eighth consecutive calendar month expires.

(e) For each taxable year for which an affiliated group has made an election

provided in paragraph (a) of this subsection, the consolidated return shall

include all corporations which are members of the affiliated group.

(5) Each corporation included as part of an affiliated group filing a consolidated return

shall be jointly and severally liable for the income tax liability computed on the

consolidated return, except that any corporation which was not a member of the

affiliated group for the entire taxable year shall be jointly and severally liable only

for that portion of the Kentucky consolidated income tax liability attributable to that

portion of the year that the corporation was a member of the affiliated group.

(6) Every corporation return or report required by this chapter shall be executed by one

(1) of the following officers of the corporation: the president, vice president,

secretary, treasurer, assistant secretary, assistant treasurer, or chief accounting

officer. The department may require a further or supplemental report of further

information and data necessary for computation of the tax.

(7) In the case of a corporation doing business in this state that carries on transactions

with stockholders or with other corporations related by stock ownership, by

interlocking directorates, or by some other method, the department shall require

information necessary to make possible accurate assessment of the income derived

by the corporation from sources within this state. To make possible this assessment,

the department may require the corporation to file supplementary returns showing

information respecting the business of any or all individuals and corporations

related by one (1) or more of these methods to the corporation. The department may

require the return to show in detail the record of transactions between the

corporation and any or all other related corporations or individuals.