Legislative Research Commission PDF Version
103 KAR 28:051. Leases and rentals.
RELATES TO: KRS 138.460, 138.463, 139.010, 139.105, 139.200, 139.210, 139.270,
139.280, 139.290, 139.310, 139.330, 139.340, 139.430, 139.471, 139.484, 139.600, 139.620
STATUTORY AUTHORITY: KRS 131.130(1), 139.710
NECESSITY FUNCTION AND CONFORMITY: KRS 131.130(1) authorizes the department
to make administrative regulations for the administration and enforcement of all tax laws in this
state, and KRS 139.710 requires the department to administer the provisions of KRS Chapter
139, regarding sales and use taxes. This administrative regulation sets forth requirements for
leases and rentals of tangible personal property or digital property relating to the sales and use
tax law.
Section 1. Definitions.
(1) "Primary property location" means the location as indicated by an address for the proper-
ty provided by the lessee that is available to the lessor from the lessor's records maintained in
the ordinary course of business, if use of this address does not constitute bad faith. This loca-
tion shall not be altered by intermittent use of the property at different locations.
(2) "Transportation equipment" means any of the following:
(a) Locomotives and railcars that are utilized for the carriage of persons or property in inter-
state commerce;
(b) Trucks and truck-tractors with a gross vehicle weight rating (GVWR) of 10,001 pounds or
greater, trailers, semi-trailers, or passenger buses that are:
1. Registered through the International Registration Plan; and
2. Operated under authority of a carrier authorized and certificated by the U.S. Department
of Transportation or another federal authority to engage in the carriage of persons or property
in interstate commerce;
(c) Aircraft that are operated by air carriers authorized and certificated by the U.S. Depart-
ment of Transportation or another federal authority or a foreign authority to engage in the car-
riage of persons or property in interstate or foreign commerce; and
(d) Containers designed for use on and component parts attached or secured on the items
set forth in paragraphs (a) through (c) of this section.
Section 2. Registrants.
(1) A person engaged in leasing or renting tangible personal property or digital property for
use in Kentucky is a retailer and shall:
(a) Complete a "Kentucky Tax Registration Application", Revenue Form 10A100; and
(b) Report and pay the applicable tax derived from the gross lease or rental receipts utilizing
the "Sales and Use Tax Return", Revenue Form 51A102.
(2) Each period for which a lease or rental is payable shall be considered a complete trans-
action in determining a retailer responsible for the tax in accordance with KRS 139.010.
Section 3. Gross Receipts.
(1) Gross receipts from the lease or rental of tangible personal property or digital property
shall include:
(a) The total amount of payments, or consideration received by the lessor from the lessee;
(b) Payments paid by the lessee to a third party for the benefit of the lessor which are re-