EARNED INCOME TAX CREDIT (EITC)

Kentucky does not currently offer a state-level EITC.

Latest Legislative Action: In 2023, Gov. Andy Beshear enacted 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. 

Notes:

• 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.
• In 2014, Gov. Steve Beshear proposed a tax reform plan that would have created a refundable EITC at 7.5% of the federal credit, but it was not enacted.
• 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.

Latest Legislative Action: Lawmakers introduced SB 12 to create a refundable CTC valued at $1,000 per child for children under age six, with eligibility capped at $50,000 for single filers and $100,000 for joint filers; the bill did not advance.

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.