Earlier this week, a bill was signed into law which will reportedly ease the tax burden on small businesses in the state of Kentucky. The bill, which establishes a non-refundable state income tax credit, is aimed at assisting folks in starting and expanding small businesses throughout the state of Kentucky. Sources didn’t provide many details about the new law except to say that the credit ranges between $3,500 and $25,000 and requires that businesses create and maintain at least one new job for a year, and also that they purchase at least $5,000 in equipment.

The tax burden faced by small businesses is, of course, an important financial burden requiring careful planning and consideration, particularly with respect to the way the business is structured. As the U.S. Small Business Administration points out on its website, every state imposes some kind of business income tax, the specific requirements of which depend on the particular structure of the business. 

In addition to income taxes, there are employment taxes, which include workers’ compensation insurance and unemployment taxes in all states. Getting tax planning correct can save businesses a significant amount of money and trouble. As with anything, it is better to get such planning right the first time around rather than having to fix mistakes later on down the road.

Those who are engaged in tax planning for a small business in Kentucky should consult the Kentucky Department of Revenue for further information on various taxes, as well as a tax professional to ensure they are on the right track with their tax obligations.