KRS 134.580 — Refund of taxes, other than ad valorem and unconstitutional taxes -- Immunity of the Commonwealth from refund suits based on combined or consolidated returns

(1) As used in this section, unless the context requires otherwise:
(a) "Agency" means the agency of state government which administers the tax to
be refunded or credited; and
(b) "Overpayment" or "payment where no tax was due" means the excess of the
tax payments made over the correct tax liability determined under the terms of
the applicable statute without reference to the constitutionality of the statute.
(2) When money has been paid into the State Treasury in payment of any state taxes,
except ad valorem taxes, whether payment was made voluntarily or involuntarily,
the appropriate agency shall authorize refunds to the person who paid the tax, or to
his or her heirs, personal representatives or assigns, of any overpayment of tax and
any payment where no tax was due. When a bona fide controversy exists between
the agency and the taxpayer as to the liability of the taxpayer for the payment of tax
claimed to be due by the agency, the taxpayer may pay the amount claimed by the
agency to be due, and if an appeal is taken by the taxpayer from the ruling of the
agency within the time provide d by KRS 49.220 and it is finally adjudged that the
taxpayer was not liable for the payment of the tax or any part thereof, the agency
shall authorize the refund or credit as the Board of Tax Appeals or courts may
direct.
(3) No refund shall be made unless each taxpayer individually files an application or
claim for the refund within four (4) years from the date payment was made. Each
claim or application for a refund shall be in writing and state the specific grounds
upon which it is based. Denials of refu nd claims or applications may be protested
and appealed in accordance with KRS 49.220 and 131.110.
(4) Notwithstanding any provision of this section, when an assessment of limited
liability entity tax is made under KRS 141.0401 against a pass -through entit y as
defined in KRS 141.206, the corporation or individual partners, members, or
shareholders of the pass -through entity shall have the greater of the time period
provided by this section or one hundred eighty (180) days from the date the
assessment becomes final to file amended returns requesting any refund of tax for
the taxable year of the assessment and to allow for items of income, deduction, and
credit to be properly reported on the returns of the partners, members, or
shareholders of the pass-through entity subject to adjustment.
(5) Refunds shall be authorized with interest as provided in KRS 131.183. The refunds
authorized by this section shall be made in the same manner as other claims on the
State Treasury are paid. They shall not be charged again st any appropriation, but
shall be deducted from tax receipts for the current fiscal year.
(6) Nothing in this section shall be construed to authorize the agency to make or cause
to be made any refund except within four (4) years of the date prescribed by law for
the filing of a return including any extension of time for filing the return, or the date
the money was paid into the State Treasury, whichever is the later, except in any
case where the assessment period has been extended by written agreement betw een
the taxpayer and the department, the limitation contained in this subsection shall be
extended accordingly. Nothing in this section shall be construed as requiring the
agency to authorize any refund to a taxpayer without demand from the taxpayer, if
in the opinion of the agency the cost to the state of authorizing the refund would be
greater than the amount that should be refunded or credited.
(7) This section shall not apply to any case in which the statute may be held
unconstitutional, either in whole or in part.
(8) In cases in which a statute has been held unconstitutional, taxes paid thereunder
may be refunded to the extent provided by KRS 134.590, and by the statute held
unconstitutional.
(9) No person shall secure a refund of motor fuels tax under KRS 134.580 unless the
person holds an unrevoked refund permit issued by the department before the
purchase of gasoline or special fuels and that permit entitles the person to apply for
a refund under KRS 138.344 to 138.355.
(10) Notwithstanding any provision of the Kentucky Revised Statutes to the contrary:
(a) The Commonwealth hereby revokes and withdraws its consent to suit in any
forum whatsoever on any claim for recovery, refund, or credit of any tax
overpayment for any taxable year ending before December 31, 1995, made by
an amended return or any other method after December 22, 1994, and based
on a change from any initially filed separate return or returns to a combined
return under the unitary business concept or to a consolidated return. No such
claim shall be effective or recognized for any purpose;
(b) Any stated or implied consent for the Commonwealth of Kentucky, or any
agent or officer of the Commonwealth of Kentucky, to be sued by any person
for any legal, equitable, or other relief with respec t to any claim for recovery,
refund, or credit of any tax overpayment for any taxable year ending before
December 31, 1995, made by an amended return or any other method after
December 22, 1994, and based on a change from any initially filed separate
return or returns to a combined return under the unitary business concept or to
a consolidated return, is hereby withdrawn; and
(c) The provisions of this subsection shall apply retroactively for all taxable years
ending before December 31, 1995, and shall apply to all claims for such
taxable years pending in any judicial or administrative forum.
(11) Notwithstanding any provision of the Kentucky Revised Statutes to the contrary:
(a) No money shall be drawn from the State Treasury for the payment of any
claim for recovery, refund, or credit of any tax overpayment for any taxable
year ending before December 31, 1995, made by an amended r eturn or any
other method after December 22, 1994, and based on a change from any
initially filed separate return or returns to a combined return under the unitary
business concept or to a consolidated return; and
(b) No provision of the Kentucky Revised S tatutes shall constitute an
appropriation or mandated appropriation for the payment of any claim for
recovery, refund, or credit of any tax overpayment for any taxable year ending
before December 31, 1995, made by an amended return or any other method
after December 22, 1994, and based on a change from any initially filed
separate return or returns to a combined return under the unitary business
concept or to a consolidated return.