STAFF REPORT
Glasgow News 1
Gov. Andy Beshear is encouraging Kentucky small businesses that are creating jobs and investing in their operations to apply for a state tax credit worth up to $25,000 per year.
According to the Governor’s Office and KY Innovation, the Kentucky Small Business Tax Credit program is designed to reward companies that hire new workers and purchase qualifying equipment or technology.
Officials say qualifying small businesses should apply now to maximize their chances for approval in time for their upcoming tax filings.
Complete applications received by Nov. 1 will be fully reviewed for 2026 tax-credit eligibility, according to state economic development officials.
Applications can be submitted at any point during the year, but those received after Nov. 1 may not be eligible for credits until the 2027 tax year.
To qualify for the Kentucky Small Business Tax Credit, an eligible company must have added at least one net new full-time employee and invested $5,000 or more in qualifying equipment or technology within the last 24 months.
Program guidelines indicate that most for-profit businesses with 50 or fewer full-time employees will qualify.
That includes construction, manufacturing, retail, service and wholesale companies across the commonwealth.
The amount of the income tax credit ranges from $3,500 to $25,000 per year, depending on the number of new jobs created and the size of the investment in new equipment or technology.
State officials say the program is intended to support entrepreneurs and small business owners who continue to invest in their employees and their long-term success in Kentucky.
According to KY Innovation, there are nearly 400,000 businesses in Kentucky employing more than 710,000 people, and small businesses are considered a backbone of local economies.
In the last year alone, the Kentucky Small Business Tax Credit program approved more than $1.2 million in credits for businesses that invested over $3.9 million and created 352 new jobs in the state.
Since the program’s inception, it has assisted in creating more than 5,100 new jobs, generated over $53.7 million in investments in small businesses and allocated more than $17.4 million in total tax credits, according to state figures.
The tax credit is a signature program offered through KY Innovation, which is housed within the Kentucky Cabinet for Economic Development.
Other KY Innovation resources include programs that provide access to credit, business mentoring and advocacy for entrepreneurs and small firms.
Entrepreneurs and small business owners are also encouraged to connect with the six regional KY Innovation Hub offices located around Kentucky for additional guidance and support.
Officials say more information on the Kentucky Small Business Tax Credit, along with the current application, is available through KY Innovation and the Kentucky Cabinet for Economic Development.
Key Facts
– Gov. Andy Beshear is encouraging eligible Kentucky small businesses to apply for the Kentucky Small Business Tax Credit.
– The credit ranges from $3,500 to $25,000 per year, depending on jobs created and investment levels.
– Businesses must have added at least one net new full-time employee and invested $5,000 or more in qualifying equipment or technology in the last 24 months.
– Most for-profit businesses with 50 or fewer full-time workers may qualify, including construction, manufacturing, retail, service and wholesale firms.
– Complete applications received by Nov. 1 will be fully reviewed for 2026 tax-credit eligibility; later applications may wait until the 2027 tax year.
– The program has helped create more than 5,100 jobs and generated over $53.7 million in small business investment since its inception.
– Applications and program details are available through KY Innovation and the Kentucky Cabinet for Economic Development.
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