Small businesses in Northern Kentucky that hired new workers and bought equipment could save up to $25,000 on their state taxes.

Gov. Andy Beshear on Sept. 3 urged eligible companies to apply for the Kentucky Small Business Tax Credit (KSBTC) program before Nov. 1 to qualify for 2026 tax-year credits. Applications submitted after that date may not be reviewed until the 2027 tax year, The Lane Report reported.

The program offers state income tax credits ranging from $3,500 to $25,000 per year. The average credit earned by participating companies is $14,870, according to the state's KSBTC program page.

Who qualifies

Most for-profit Kentucky businesses with 50 or fewer full-time employees are eligible. That includes construction, manufacturing, retail, services and wholesale businesses.

To qualify, a business must have:

  • Added at least one net new full-time employee within the previous 24 months
  • Invested at least $5,000 in qualifying equipment or technology during that same period

The new hire must have been on the payroll for at least one year and must earn at least $10.88 per hour, according to the program's guidelines.

Statewide track record

The numbers are significant. Kentucky businesses approved through the program received more than $1.2 million in tax credits during the most recent program year, according to the state. Those companies invested more than $3.9 million and created 352 jobs statewide.

Since the program began, it has supported more than 5,100 jobs and generated over $53.7 million in small-business investments. More than $17.4 million in tax credits have been awarded through the program's history.

"This program helps businesses that continue to invest in their people and their future success in Kentucky," David Brock, executive director of KY Innovation, said in the Sept. 3 announcement.

How to apply

The KSBTC is administered by KY Innovation, part of the Kentucky Cabinet for Economic Development. Business owners can apply online at the state's KSBTC page, call 800-626-2930 or email [email protected].

Submitting an application does not guarantee approval. Complete applications received by Nov. 1 will be reviewed for 2026 tax-year eligibility.