Kentucky DOR Announces Unemployment Benefits Fully Taxable on State Individual Income Tax Returns

The Kentucky Department of Revenue (DOR) April 1 announced that unemployment compensation earned as a Kentucky resident is subject to state individual income tax. Amounts up to $10,200 excluded on taxpayers’ federal income tax returns: 1) should be added back on a state resident individual income tax return on Schedule M, Line 5 as an “Other Addition;" and 2) should be included on Form 740-NP, Section B, Column B, line 13 as unemployment compensation for part-year Kentucky residents. [Ky. Dep’t of Revenue, Unemployment Benefits Fully Taxable on Kentucky Returns, 04/01/21]

Reference: View Source Document.