EARNED INCOME TAX CREDIT (EITC)

Kentucky does not currently offer a state-level EITC.

Latest Legislative Action:

During the 2016 legislative session, lawmakers considered a bill that would create a refundable state EITC at 10% of the federal credit. SB 157 did not advance beyond the Senate Appropriations and Revenue Committee.

Notes:

• In 2023, the Kentucky House of Representatives recently passed House Joint Resolution (HJR) 39, which requires the Cabinet for Health and Family Services to develop and implement a federal EITC outreach and education program. The bill is in the Senate.
• In December 2012, the Governor’s Blue Ribbon Commission on Tax Reform’s final report recommended creating a state EITC at 15 percent of the federal credit. Gov. Steve Beshear later proposed a tax reform plan in 2014 that would have created a refundable EITC at 7.5 percent of the federal credit. However, his proposal was not included in any enacted legislation.

CHILD TAX CREDIT (CTC)

Kentucky does not currently offer a state-level CTC.

CHILD AND DEPENDENT CARE TAX CREDIT (CDCTC)

Rate (Non-Refundable):  20% of the federal credit, up to $210 for one child and $420 for two or more children.

Notes: In 2011 Kentucky advocates worked to expand the CDCTC and make it refundable, but Gov. Beshear did not include any changes in his budget proposal amid a state budget crunch.