Bill > HB363

This bill amends Kentucky tax law to create a new tax deduction for union dues and professional membership dues for individual taxpayers. Specifically, for tax years beginning on or after January 1, 2026, but before January 1, 2030, taxpayers can exclude union dues and professional membership dues from their gross income, provided these dues were not already deducted under federal tax law. Professional membership dues are defined as fees required to maintain a professional license or association membership related to employment, while union dues are defined as fees required for membership in or representation by a labor organization. To help the state legislature evaluate the impact of this tax deduction, the Department of Revenue is required to submit annual reports to the Legislative Research Commission, detailing the number of returns claiming the exclusion, the total amount of exclusions, and a breakdown of reduced tax liability by income ranges. The bill also makes some technical changes to existing tax reporting regulations. The deduction is temporary, applying only for a four-year period, which suggests it is intended as a pilot program to assess its potential benefits for workers.