Schedule UTC: Unemployment Tax Credit (2024)
Kentucky · Kentucky DOR · Used for tax years 2024
Kentucky Schedule UTC reports employees for whom you are claiming the unemployment tax credit, including their names, Social Security numbers, employment dates, and certificate numbers. It calculates the credit at $100 per qualifying employee and is attached to your tax return.
Who files this form
Use 2024 Schedule UTC to claim Kentucky's unemployment tax credit for qualifying employees you hired.
For an employee to qualify, they must:
- Have been classified as unemployed by the Education and Workforce Development Cabinet, Department of Workforce Investment, Office of Development and Training for at least 60 days before you employed them.
- Remain employed by you for at least 180 consecutive days during the tax year for which you claim the credit.
Organizations exempt from income tax under KRS Chapter 141 cannot claim the credit. The form also excludes certain employees, including those covered by federally funded on-the-job training payments and those with specified family, ownership, estate, trust, or dependent relationships.
What you'll need
Have the information requested on Schedule UTC ready:
- Entity name, address, Social Security number, federal identification number, and Kentucky Corporation/LLET account number, as applicable.
- Each employee's name and Social Security number.
- Each employee's Office of Employment and Training certificate number.
- Each employee's hire date and the last date they were on your payroll during the tax year.
Schedule UTC must be attached to Form 720, 720U, PTE, 725, 740, 740-NP, or 741.
How to file
- List the employees for whom you are claiming the credit, including their Social Security numbers, employment dates, and certificate numbers.
- Enter the total number of employees on line 24, then carry that total to line 25.
- Multiply line 25 by $100 and enter the credit on line 26.
- Transfer the credit to the location for your return:
- Form 720 or 720U: Schedule TCS, Part II, Columns E and F.
- Form PTE: Schedule TCS, Part II, Column E, and Form PTE, Schedule K. General partnerships enter it only on Form PTE, Schedule K.
- Form 725: Schedule TCS, Part II, Column E.
- Form 740 or 740-NP: Schedule ITC, Section A, Line 7.
- Form 741: Line 18.
- Attach Schedule UTC to the applicable return.
The supplied text does not provide a mailing address or e-filing directions.
Common mistakes
- Claiming the same employee more than once in a tax year. The form prohibits this and treats related corporations or unincorporated trades and businesses as a single employer for this credit.
- Claiming an employee covered by federally funded on-the-job training payments. No credit is allowed if you receive those payments for that person.
- Overlooking relationship exclusions. No credit is allowed for employees with the family, ownership, estate, trust, or dependent relationships specified in the form's instructions.
- Claiming the credit as an income-tax-exempt organization. Organizations exempt under KRS Chapter 141 are not eligible.
- Forgetting to attach Schedule UTC. The form directs you to attach it to the applicable tax return.
Questions people ask
How much is the credit?
The credit is $100 for each qualifying employee. Multiply the employee count on line 25 by $100 and enter the result on line 26.
How long must an employee have been unemployed and then employed?
The employee must have been classified as unemployed by the office named in the instructions for at least 60 days before you hired them. They must then remain employed by you for at least 180 consecutive days during the tax year in which you claim the credit.
How does a pass-through entity apply the credit?
The credit is applied at the entity level against the limited liability entity tax and distributed to each partner, member, or shareholder based on their pro rata share.
How is the credit divided for an estate or trust?
The credit is apportioned between the estate or trust and its beneficiaries based on the estate or trust income allocable to each.