(A) The occupational license taxes imposed in this section shall not apply to the following persons or business entities:
(1) Public service corporations that pay an ad valorem tax on property valued and assessed by the Kentucky Department of Revenue pursuant to the provisions of KRS 136.120. Business entities whose business is predominantly non-public service and the public service business is merely incidental to the principal business, are required to pay a license tax on their net profit derived from the non-public service activities apportioned to the Louisville Metro.
(2) Any bank, trust company, combined bank and trust company or combined trust, banking and title business in this state, any savings and loan association whether state or federally chartered.
(3) Any company providing multichannel video programming services or communications services as defined in KRS 136.602. If only a portion of an entity’s business is providing multichannel video programming services or communications services, including products or services that are related to and provided in support of the multichannel video programming services or communications services, this exclusion applies only to that portion of the business that provides multichannel video programming services or communications services including products or services that are related to and provided in support of the multichannel video programming services or communications services.
(4) Any profits, earnings, or distributions of an investment fund which would qualify under KRS 154.20-250 to 154.20-284 to the extent any profits, earnings, or distributions would not be taxable to an individual investor.
(5) Any income or compensation received by precinct workers for election training or work at election booths in state, county and local primary, regular or special elections.
(6) Any income or compensation received by members of the Kentucky National Guard for active duty training, unit training assemblies and annual field training.
(7) Insurance companies who pay a license tax based on premiums under Ordinance 122 or § 38.64 or domestic life insurance companies that pay a tax based on taxable capital under § 38.36 are not required to pay a license tax measured by net profits under the terms of this chapter.
(8) Persons or business entities that have been issued a license under KRS Chapter 243 to engage in the manufacturing or trafficking in alcoholic beverages may exclude the portion of their net profits derived from the manufacturing or trafficking in alcoholic beverages.
(9) A sale of used goods conducted or participated in by the resident of the residential property on which the sale takes place shall not be
considered a business for purposes of this chapter unless such sales are conducted for more than three consecutive days or for more than four times a year.
(10) During “Derby Festival Week,” that is the week preceding and including the first Saturday in May, residents who provide parking spaces for a fee in the area encompassed by Colorado Avenue on the north, Interstate 264 (Watterson Expressway) on the south, Louisville Avenue (railroad tracks) on the east and Seventh Street Road on the west, shall not be considered to be engaged in an occupation for purposes of this chapter and no license is required.
(11) The occupation of serving as a duly ordained minister of religion is exempted from the terms of this chapter and no occupational license tax is required. It is not the intention of this chapter to exempt a duly ordained minister of religion from the necessity of paying the license tax measured by compensation and net profits earned for activities not connected with his or her regular duties as a minister of religion.
(12) Venture capital funds are exempt from the terms of this section provided, that for purposes of this exemption, a venture capital fund is a limited liability company, limited liability partnership, or limited partnership, formed and operated for the exclusive purpose of buying, holding and/or selling securities (including debt securities), on its own behalf and not as a broker, primarily in non-publicly traded companies, and the capital of the fund is primarily derived from investments by entities and/or individuals which are neither, directly or indirectly, related to nor affiliated with the fund. An annual informational return is required to be filed in order to qualify for this exemption. For purposes of this section, the following provisions shall apply:
(a) AFFILIATED. Entities that are part of an affiliated group as defined in 26 U.S.C. § 1504(a) and any applicable federal regulations thereto, as they may be amended from time to time;
(b) NON-PUBLICLY TRADED COMPANIES. Any business entity that is not a PUBLICLY TRADED COMPANY, as defined by subsection (d)(4);
(c) PRIMARILY, as used in this section, means over 80%.
(d) PUBLICLY TRADED COMPANY. Any entity that is traded on:
1. A national securities exchange registered under § 6 of the Securities Exchange Act of 1934 or exempted from registration under such act by 15 U.S.C. § 78f because of the limited volume of transactions;
2. A foreign securities exchange operating under principles analogous to a national securities exchange;
3. A regional or local exchange;
4. An interdealer quotation system that regularly disseminates firm buy or sell quotations by identified brokers or dealers by electronic means or otherwise; or
5. On a secondary market or the substantial equivalent thereof, if taking into account all of the facts and circumstances, the owners are readily able to buy, sell or exchange their ownership interest in a manner that is comparable, economically, to trading on an exchange.
(e) RELATED. Entities and/or individuals that are related as determined by 26
U.S.C. § 267(b) and (f) and any federal regulations applicable thereto as they may be amended from time to time.
(13) Any family-owned non-corporate entity where the sole activity of such entity is the production of investment income is exempted from the terms of this section. An annual informational return must be filed in order to qualify for this exemption. For purpose of this section, the following provisions shall apply:
(a) FAMILY-OWNED. At least 95% of the equity of such entity is owned by members of the family, which means, with respect to an individual, only:
1. An ancestor of such individual;
2. The spouse or former spouse of such individual;
3. A lineal descendent of such individual, of such individual’s spouse or former spouse, or of a parent of such individual;
4. The spouse or former spouse of any lineal descendent described in subsection 3.; or
5. The estate or trust of a deceased individual who, while living, was as described in any of the above subsections.
6. For purposes of this section, a legally adopted child of an individual shall be treated as the child of such individual by blood.
(b) INVESTMENT INCOME means and includes gross receipts derived from dividends, interest, annuities, and sales or exchanges of stock or securities to the extent of any gains therefrom.
(14) Except for the license taxes permitted pursuant to KRS 91.202 for “racetrack extensions”, no tax is levied on a track as defined in KRS 230.210(24)(c).
(15) No license tax under this chapter is required where expressly exempted elsewhere in this chapter or prohibited by federal or state law.
(B) The provisions and limitations of this subsection shall not apply to license fees imposed for regulatory purposes as to form and amount.
(Lou. Metro Ord. No. 110-2008, approved 6-30-2008; Lou. Metro Am. Ord. No. 153-2022, approved 10-31-2022)