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Frequently asked Questions

Employee Withholding Questions

Q. What employee pay is subject to the fee?
A. The total gross pay, including commissions and bonuses, earned within the City of Bardstown. Gross pay cannot be reduced by any deductions treated as pre-tax deductions for federal tax purposes; such as 401 K contributions. (Ordinance Section 117.01 Definition of Salaries, Wages, etc.) Review ordinance for allowable expense reductions.

Q. What are the due dates for reporting and payment of withholdings?
A. January 31, 2004 for the initial tax period of 8-1-03 through 12-31-03, and by the last day of April, July, October, and January for all subsequent quarters.

· Annually for employers with anticipated yearly withholding liability of $1000 or less.
· Quarterly for those with an anticipated yearly withholding liability of more than $1000.
· Monthly for those with an anticipated liability of $5000 or more in any one month.

Any employer may choose to pay the withheld amounts on the monthly schedule.

Q. As employer, I failed to withhold from my employees. How do I address this oversight?
A. You, the employer, are liable and must pay the full license fee that should have been withheld (Ordinance Section 117.13 c ). (You may recoup that amount by deducting it, plus current year fee withholdings, from those employees still employed.)

Q. Who pays the fee for partnerships, LLC's taxed as partnerships, and s-corps?
A. The partners and/or individual owners. The entity (partnership, s-corp, or LLC) files a Net Profits License Fee Information Return, upon which is reported each partner or shareholder name, social security number, address distributive share and taxable amount. A copy is provided to both the City and the partners/shareholders. The individuals then pays the fee based on their individual taxable amount. The entity may pay on behalf of the owners, but shall report each owner's share.

Business License Questions

Q. Who must obtain a Business License?
A. Any business doing business in or starting a business in the City of Bardstown (City), any business with sales personnel calling on customers within the City, contractors working within the City, self-employed persons working within the City, and anyone in similar situations shall apply for a license.

Q. How is a Business License obtained?
A. A newly started business in the City and a business located outside the City planning to do business in the City shall file a Business License Application and pay an initial $25.00 license fee prior to the start of business within the City.
B. A business which had a 2003 Business License and is filing the required Net Profits License Fee Return and/or License Fee Withholding Return qualifies for and will automatically receive a current year Business License.

You can obtain a Business License Application from our website at www.cityofbardstown.com, or
e-mail mabell@bardstowncable.net , or call (502) 348-5947, ext 213, or visit City Hall to request an application. Return the application with the $25.00 fee and a license will be mailed to you.

Q. What else must a business do to comply with Bardstown's Occupational License Fee/Net Profits Ordinance?
A. Withhold and pay to the City ½% of each employee's wages earned within the City, exempting the first $15,000 earned and taxing the next $60,000 earned. (See Occupational License Fee Frequently Asked Questions for more detail on covered earnings.)
B. File, each year, a Net Profits License Fee Return (or Information Return only for Sub-S Corporations, Partnerships, and LLC's taxed as Sub-S Corps) and pay a ½% fee on net profits earned within the City. The first $15,000 in net profits is exempt. The next $60,000 is taxed. The Net Profits Return is due on April 15th each year, or 105 days after the close of the fiscal year. The City accepts federal filing deadline extensions, though interest and penalties apply to any late payments.

Q. What forms are needed to comply with the Ordinance?
A. 1. Business License Application
2. License Fee Withholding Return and Annual Reconciliation
3. Net Profits Return (or Net Profits Information Return).