ORDINANCE NO. , SERIES 2026
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AN ORDINANCE AMENDING THE LOUISVILLE/JEFFERSON COUNTY METRO GOVERNMENT CODE OF ORDINANCE (“LMCO”) SECTION
110 TO FACILITATE THE LOUISVILLE METRO REVENUE COMMISSION’S (‘LMRC”) TRANSITION TO THE ELECTRONIC FILING OF FORMS AND REFUND REQUESTS AND TO CLARIFY PROVISIONS.
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SPONSORED BY: COUNCIL MEMBERS KRAMER AND WINKLER
WHEREAS, employees who have Metro Occupational License Taxes withheld and remitted to LMRC from compensation attributable to work performed outside the Metro area may request a refund, pursuant to LMCO §110.05, of those withheld occupational license taxes assessed on work performed outside of Metro by providing a schedule and computation sufficient to verify the refund claim; and
WHERAS, KRS 67.788, which authorizes LMRC to refund the taxes assessed on compensation attributable to an employee’s activities performed outside of Metro, states that the tax district “may” confirm the employee’s percentage of time spent outside of the taxing district; and
WHEREAS, LMCO §110.05(I) does not use the permissive “may” and states that LMRC “shall” confirm the accuracy of an employee’s refund request with his or her employer; and
WHERAS, LMCO §110.05(l) and KRS 67.788(3) are inconsistent and uniformity between the ordinance and statute would assist LMRC in providing prompt assistance to taxpayers as LMRC transitions to electronic filing of refund requests; and
WHEREAS, LMCO §110.18(A)(1) exempts an employer, employee, third party payroll reporting agent, business entity, natural person or other taxpayer who files 25 or fewer returns, from electronic filing but LMCO §110.18(A)(2) is inconsistent and exempts tax return preparers who file no more than ten returns from electronic filing; and
WHEREAS, uniformity between all filing entities would assist LMRC as it continues its ongoing transition to electronic filing; and
WHEREAS, LMCO §110.17(A) references the definition of “independent contractor” in LMCO §110.01, and LMCO §110.01 does not define “independent contractor;” and
WHEREAS, LMCO §110.17(B) contains conflicting terms, identifying employed taxpayers as both “independent contractors” and employees if tips are received; and
WHEREAS, LMCO §110.11(A) requires LMRC to provide written notice of its intent to adopt or amend regulations to interested parties including the “President of Greater Louisville, Inc.;” and
WHEREAS, Greater Louisville, Inc. no longer exists and “One Louisville” is the official regional chamber of commerce and economic development organization.
NOW, THEREFORE, BE IT ORDAINED BY THE LEGISLATIVE COUNCIL OF THE LOUISVILLE/JEFFERSON COUNTY METRO GOVERNMENT AS FOLLOWS:
SECTION I: LMCO Section 110.05 is amended in relevant part as follows:
§ 110.05 DEDUCTION TO BE MADE BY EMPLOYERS.
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(I) An employee who has compensation attributable to activities performed outside the Louisville Metro area, based on time spent outside the Louisville Metro area, whose employer has withheld and remitted to the Commission the occupational license tax on the compensation attributable to activities performed outside the Louisville Metroarea, may file for a refund within two years of the date prescribed by law for the filing of a return. The employee shall provide a schedule and computation sufficient to verify the refund claim, and the Commission may shall confirm with the employer the percentage of
time spent outside the Louisville Metro area and the amount of compensation attributable to activities performed outside the Louisville Metro area prior to approval of the refund.
SECTION II: LMCO Section 110.18 is amended in relevant part as follows:
§ 110.18 ELECTRONIC FILING.
(A) The following are required to electronically file all returns, forms, or reports with the Revenue Commission:
(1) Beginning January 1, 2027, aAny employer, employee, business entity,
third party payroll reporting agent, natural person or other taxpayer who files ten or more
than 25 returns, forms, or reports annually; and
(2) Beginning January 1, 2024, any tax return preparer that files, or reasonably expects to file, ten or more returns, forms, or reports annually.
(B) The Commission shall have exclusive authority to prescribe or require the returns, forms, or reports filed and the manner in which each is filed.
SECTION III: LMCO Section 110.01 is amended in relevant part as follows:
§ 110.01 DEFINITIONS.
For the purpose of this chapter the following definitions shall apply unless the context clearly indicates or requires a different meaning.
. . .
FISCAL YEAR. An accounting period of 12 months ending on the last day of any month other than December.
INDEPENDENT CONTRACTOR: A self-employed individual as defined by the Internal
Revenue Service and/or a recipient of IRS Form 1099-NEC.
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SECTION IV: LMCO Section 110.17 is amended in relevant part as follows:
§ 110.17 CERTAIN PERSONS SUBJECT TO THE OCCUPATIONAL LICENSE TAX.
(A) An individual who is an INDEPENDENT CONTRACTOR as defined in §110.01 shall pay an occupational license tax measured by net profits and an individual who is an employee as defined in §110.01 shall pay an occupational license tax measured by compensation.
(B) Waiters, waitresses, bellhops and others receiving tip income are shall be deemed to be employees with respect to any base wage and any tip income on which the employer withholds and remits an occupational license tax. , and, in addition, shall be deemed independent contractors for purposes of any tip income or other compensation received for which the employer has not withheld and remitted an occupational license tax. An individual who receives tip income not reported by his or her employer is deemed to be engaged in an activity which requires him or her to register with the Commission and obtain his or her own reporting identification number, to file an annual return as required by § 110.07 and to remit the license tax due as shown on said return.
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SECTION V: LMCO Section 110.11 is amended in relevant part as follows:
(A) The Commission is hereby charged with the enforcement of the provisions of this chapter and are hereby empowered to prescribe, adopt, promulgate, and enforce rules and regulations relating to all matters pertaining to the administration and enforcement of the provisions of this chapter, including without limitation rules and regulations clarifying, construing, and supplementing the provisions of this chapter in a manner not inconsistent with any of the provisions of this chapter. The Commission shall give written notice of its intention to adopt or amend any regulations to the Mayor, the Council Clerk, the Chairman of the Board of the Transit Authority of River City, the Superintendent of the Jefferson County Public School System, the Superintendent of the Anchorage Public School System, the Executive Director of the Kentucky Society of Certified Public Accountants, and the Chief Executive Officer of One Louisville or its successors President of Greater Louisville, Inc. at least 30 days prior to the final adoption of any proposed regulations or amendments and shall allow an opportunity for comment on each proposed regulation or proposed amendment prior to adoption. The rules and regulations promulgated by the Commission and the rulings made by the Commission shall be binding on all business entities, employers, and employees affected.
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SECTION VI: This Ordinance shall take effect upon its passage and approval or otherwise becoming law.
Sonya Harward Metro Council Clerk 
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Brent Ackerson President of the Council |
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Craig Greenberg Mayor
APPROVED AS TO FORM:
Michael J. O’Connell Jefferson County Attorney
By:
O-305-26 - Amending sections of LMCO Ch. 110 08/20/2026 NHP