Are you a Kentucky resident planning to put off your taxes until the extension deadline? You may want to reconsider.
Earlier this year, severe storms, straight-line winds, flooding, and landslides ripped through the Commonwealth, resulting in over 1,000 rescues and at least 21 deaths. Thousands of others were without power for several days; hundreds of road closures are still in effect.
While it may bring little relief, the IRS’ tax deadline extension could help some Kentucky residents complete their federal tax obligations. After all, the IRS typically waives interest and penalties on taxes owed by taxpayers in disaster areas.
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However, state-level income taxes may be another story. According to the Kentucky Department of Revenue (DOR), taxpayers affected by disaster may owe higher state tax bills if they opt for a later extension deadline in the fall.
Read on.
Kentucky tax extension
On Feb. 24, the IRS announced tax relief for all individuals and businesses in Kentucky — just ten days after the February storms began. This announcement pushed the tax day deadline for Kentuckians from April 15 to November 3, 2025. The extension applies to numerous key federal tax deadlines, including:
- Individual income tax returns and payments that are typically due on April 15, 2025.
- 2024 contributions to IRAs and health savings accounts for eligible taxpayers.
- Quarterly estimated income tax payments for 2025, including those normally due on April 15, June 16, and September 15, 2025.
- Various payroll, partnership, S corporation, and tax-exempt organization returns.
For more information on the federal tax return extension, see the IRS Kentucky deadline announcement.
Kentucky state tax deadline
The extended tax deadline for Kentucky returns is November 3, 2025. That includes individual and business tax returns originally due April 15, 2025.
The Commonwealth's announcement in February said that the state tax deadlines “will mirror the IRS federal extensions related to this disaster for filing income tax returns, including payment of tax due.”
However, unlike the federal tax extension announcement, the state cautions that filing later may come with a price.
“Kentucky’s tax laws have no provision to waive interest accrued,” the state’s DOR writes in a release, “Therefore, the total liability due will increase for taxpayers who defer paying their taxes by the regularly scheduled due date.”
How much interest could you pay?
Luckily, the Kentucky DOR provides an example.
Kentucky tax payment example
If you decide to file and pay your Kentucky state taxes by the November 3, 2025, extension deadline, the interest rate can be as high as 10%.
But here is an example given by the state’s DOR of how much you could owe:
- If you have $50,000 in state-taxable income, then
- Your tax liability on Apr. 15 may be $2,000.
- If you delay your filing and payment until Nov. 3, then your added interest could be $111.23.
- This means the total tax owed on Nov. 3 would be $2,111.23 if you decided not to file and pay by April 15.
Note: This example is from the KY Department of Revenue website and does not include applicable deductions, withholding payments, or estimated tax paid throughout the year.
Because interest fees could increase your state tax liability from April 15 to November 3, the Kentucky Department of Revenue encourages taxpayers to file by the April deadline or as soon as possible after tax day.
Kentucky disaster relief for taxes
Taxpayers claiming disaster relief should write “Kentucky Disaster Relief” at the top of state tax returns, according to the Kentucky DOR. The writing should be in large, red lettering. E-filing Kentucky residents can enter “Disaster” on their return with most tax software.
If filing after regularly required deadlines, affected taxpayers should also write the FEMA disaster declaration number, 3624-EM, on any return. This number should be put on federal tax returns, especially when claiming a casualty loss or requesting copies of previously filed tax returns.
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