141.020 Levy of income tax on individuals -- Rate of normal tax -- Tax credits -- Income of nonresidents subject to tax -- Election to pay tax imposed by KRS <br>141.023. (1) An annual tax shall be paid for each taxable year by every resident individual of this state upon his entire net income as defined in this chapter. The tax shall be <br>determined by applying the rates in subsection (2) of this section to net income and <br>subtracting allowable tax credits provided in subsection (3) of this section. (2) (a) For taxable years beginning before January 1, 2005, the tax shall be determined by applying the following rates to net income: <br>1. Two percent (2%) of the amount of net income up to three thousand <br>dollars ($3,000); 2. Three percent (3%) of the amount of net income over three thousand <br>dollars ($3,000) and up to four thousand dollars ($4,000); 3. Four percent (4%) of the amount of net income over four thousand <br>dollars ($4,000) and up to five thousand dollars ($5,000); 4. Five percent (5%) of the amount of net income over five thousand <br>dollars ($5,000) and up to eight thousand dollars ($8,000); and 5. Six percent (6%) of the amount of net income over eight thousand <br>dollars ($8,000). (b) For taxable years beginning after December 31, 2004, the tax shall be determined by applying the following rates to net income: <br>1. Two percent (2%) of the amount of net income up to three thousand <br>dollars ($3,000); 2. Three percent (3%) of the amount of net income over three thousand <br>dollars ($3,000) and up to four thousand dollars ($4,000); 3. Four percent (4%) of the amount of net income over four thousand <br>dollars ($4,000) and up to five thousand dollars ($5,000); 4. Five percent (5%) of the amount of net income over five thousand <br>dollars ($5,000) and up to eight thousand dollars ($8,000); 5. Five and eight-tenths percent (5.8%) of the amount of net income over <br>eight thousand dollars ($8,000) and up to seventy-five thousand dollars <br>($75,000); and 6. Six percent (6%) of the amount of net income over seventy-five <br>thousand dollars ($75,000). (3) The following tax credits, when applicable, shall be deducted from the result obtained under subsection (2) to arrive at the annual tax: <br>(a) Twenty dollars ($20) for an unmarried individual; <br>(b) Twenty dollars ($20) for a married individual filing a separate return and an additional twenty dollars ($20) for the spouse of taxpayer if a separate return <br>is made by the taxpayer and if the spouse, for the calendar year in which the <br>taxable year of the taxpayer begins, had no Kentucky gross income and is not the dependent of another taxpayer; or forty dollars ($40) for married persons <br>filing a joint return, provided neither spouse is the dependent of another <br>taxpayer. The determination of marital status for the purpose of this section <br>shall be made in the manner prescribed in Section 153 of the Internal Revenue <br>Code; (c) Twenty dollars ($20) credit for each dependent. No credit shall be allowed for any dependent who has made a joint return with his spouse; (d) An additional forty dollars ($40) credit if the taxpayer has attained the age of sixty-five (65) before the close of the taxable year; (e) An additional forty dollars ($40) credit for taxpayer's spouse if a separate return is made by the taxpayer and if the taxpayer's spouse has attained the age <br>of sixty-five (65) before the close of the taxable year, and, for the calendar <br>year in which the taxable year of the taxpayer begins, has no Kentucky gross <br>income and is not the dependent of another taxpayer; (f) An additional forty dollars ($40) credit if the taxpayer is blind at the close of the taxable year; (g) An additional forty dollars ($40) credit for taxpayer's spouse if a separate return is made by the taxpayer and if the taxpayer's spouse is blind, and, for <br>the calendar year in which the taxable year of the taxpayer begins, has no <br>Kentucky gross income and is not the dependent of another taxpayer; (h) In the case of nonresidents, the tax credits allowable under this subsection shall be the portion of the credits that are represented by the ratio of the <br>taxpayer's Kentucky adjusted gross income as determined by KRS <br>141.010(10), without the adjustments contained in (f) and (g) of that <br>subsection, to the taxpayer's adjusted gross income as defined in Section 62 of <br>the Internal Revenue Code. However, in the case of a married nonresident <br>taxpayer with income from Kentucky sources, whose spouse has no income <br>from Kentucky sources, the taxpayer shall determine allowable tax credit(s) by <br>either: <br>1. The method contained above applied to the taxpayer's tax credit(s), <br>excluding credits for a spouse and dependents; or 2. Prorating the taxpayer's tax credit(s) plus the tax credits for the <br>taxpayer's spouse and dependents by the ratio of the taxpayer's Kentucky <br>adjusted gross income as determined by KRS 141.010(10), without the <br>adjustments contained in (f) and (g) of that subsection, to the total joint <br>federal adjusted gross income of the taxpayer and the taxpayer's spouse; (i) In the case of an individual who becomes a resident of Kentucky during the taxable year, the tax credits allowable under this subsection shall be the <br>portion of the credits represented by the ratio of the taxpayer's Kentucky <br>adjusted gross income as determined by subsection (10) of KRS 141.010, <br>without the adjustments contained in paragraphs (f) and (g) of that subsection, <br>to the taxpayer's adjusted gross income as defined in Section 62 of the Internal <br>Revenue Code; (j) In the case of a fiduciary, other than an estate, the allowable tax credit shall be two dollars ($2); (k) In the case of an estate, the allowable tax credit shall be twenty dollars ($20); <br>(l) An additional twenty dollars ($20) credit shall be allowed if the taxpayer is a member of the Kentucky National Guard at the close of the taxable year. (4) An annual tax shall be paid for each taxable year as specified in this section upon the entire net income except as herein provided, from all tangible property located <br>in this state, from all intangible property that has acquired a business situs in this <br>state, and from business, trade, profession, occupation, or other activities carried on <br>in this state, by natural persons not residents of this state. A nonresident individual <br>shall be taxable only upon the amount of income received by the individual from <br>labor performed, business done, or from other activities in this state, from tangible <br>property located in this state, and from intangible property which has acquired a <br>business situs in this state; provided, however, that the situs of intangible personal <br>property shall be at the residence of the real or beneficial owner and not at the <br>residence of a trustee having custody or possession thereof. The remainder of the <br>income received by such nonresident shall be deemed nontaxable by this state. (5) Subject to the provisions of KRS 141.081, any individual may elect to pay the annual tax imposed by KRS 141.023 in lieu of the tax levied under this section. (6) An individual who becomes a resident of Kentucky during the taxable year is subject to taxation as prescribed in subsection (4) of this section prior to <br>establishing such residence and as prescribed in subsection (1) of this section <br>following the establishment of such residence. (7) An individual who becomes a nonresident of Kentucky during the taxable year is subject to taxation, as prescribed in subsection (1) of this section, during that <br>portion of the taxable year that the individual is a resident and, as prescribed in <br>subsection (4) of this section, during that portion of the taxable year when the <br>individual is a nonresident. Effective: March 18, 2005 <br>History: Amended 2005 Ky. Acts ch. 168, sec. 5, effective March 18, 2005. -- Amended 1990 Ky. Acts ch. 476, Pt. VII D, sec. 632, effective April 11, 1990. -- <br>Amended 1976 Ky. Acts ch. 77, Pt. I, sec. 1. -- Amended 1974 Ky. Acts ch. 362, <br>sec. 1. -- Amended 1972 Ky. Acts ch. 84, Pt. II, sec. 2. -- Amended 1970 Ky. Acts <br>ch. 216, sec. 5. -- Amended 1966 Ky. Acts ch. 176, Part I, sec. 3. -- Amended 1964 <br>Ky. Acts ch. 76, sec. 1. -- Amended 1962 Ky. Acts ch. 124, sec. 2. -- Amended 1960 <br>Ky. Acts ch. 5, Art. III, sec. 2. -- Amended 1958 Ky. Acts ch. 3, sec. 1. -- Amended <br>1956 (4th Extra. Sess.) Ky. Acts ch. 4, sec. 2. -- Amended 1954 Ky. Acts ch. 79, <br>sec. 2. -- Amended 1952 Ky. Acts ch. 124, sec. 1. -- Amended 1948 Ky. Acts ch. 93, <br>sec. 2. -- Amended 1946 Ky. Acts ch. 234, sec. 6. -- Recodified 1942 Ky. Acts <br>ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 4281b-14. Legislative Research Commission Note (3/18/2005). 2005 Ky. Acts ch. 168, sec. 165, provides that this section shall apply to tax years beginning on or after January 1, <br>2005.
141.020 Levy of income tax on individuals -- Rate of normal tax -- Tax credits -- Income of nonresidents subject to tax -- Election to pay tax imposed by KRS <br>141.023. (1) An annual tax shall be paid for each taxable year by every resident individual of this state upon his entire net income as defined in this chapter. The tax shall be <br>determined by applying the rates in subsection (2) of this section to net income and <br>subtracting allowable tax credits provided in subsection (3) of this section. (2) (a) For taxable years beginning before January 1, 2005, the tax shall be determined by applying the following rates to net income: <br>1. Two percent (2%) of the amount of net income up to three thousand <br>dollars ($3,000); 2. Three percent (3%) of the amount of net income over three thousand <br>dollars ($3,000) and up to four thousand dollars ($4,000); 3. Four percent (4%) of the amount of net income over four thousand <br>dollars ($4,000) and up to five thousand dollars ($5,000); 4. Five percent (5%) of the amount of net income over five thousand <br>dollars ($5,000) and up to eight thousand dollars ($8,000); and 5. Six percent (6%) of the amount of net income over eight thousand <br>dollars ($8,000). (b) For taxable years beginning after December 31, 2004, the tax shall be determined by applying the following rates to net income: <br>1. Two percent (2%) of the amount of net income up to three thousand <br>dollars ($3,000); 2. Three percent (3%) of the amount of net income over three thousand <br>dollars ($3,000) and up to four thousand dollars ($4,000); 3. Four percent (4%) of the amount of net income over four thousand <br>dollars ($4,000) and up to five thousand dollars ($5,000); 4. Five percent (5%) of the amount of net income over five thousand <br>dollars ($5,000) and up to eight thousand dollars ($8,000); 5. Five and eight-tenths percent (5.8%) of the amount of net income over <br>eight thousand dollars ($8,000) and up to seventy-five thousand dollars <br>($75,000); and 6. Six percent (6%) of the amount of net income over seventy-five <br>thousand dollars ($75,000). (3) The following tax credits, when applicable, shall be deducted from the result obtained under subsection (2) to arrive at the annual tax: <br>(a) Twenty dollars ($20) for an unmarried individual; <br>(b) Twenty dollars ($20) for a married individual filing a separate return and an additional twenty dollars ($20) for the spouse of taxpayer if a separate return <br>is made by the taxpayer and if the spouse, for the calendar year in which the <br>taxable year of the taxpayer begins, had no Kentucky gross income and is not the dependent of another taxpayer; or forty dollars ($40) for married persons <br>filing a joint return, provided neither spouse is the dependent of another <br>taxpayer. The determination of marital status for the purpose of this section <br>shall be made in the manner prescribed in Section 153 of the Internal Revenue <br>Code; (c) Twenty dollars ($20) credit for each dependent. No credit shall be allowed for any dependent who has made a joint return with his spouse; (d) An additional forty dollars ($40) credit if the taxpayer has attained the age of sixty-five (65) before the close of the taxable year; (e) An additional forty dollars ($40) credit for taxpayer's spouse if a separate return is made by the taxpayer and if the taxpayer's spouse has attained the age <br>of sixty-five (65) before the close of the taxable year, and, for the calendar <br>year in which the taxable year of the taxpayer begins, has no Kentucky gross <br>income and is not the dependent of another taxpayer; (f) An additional forty dollars ($40) credit if the taxpayer is blind at the close of the taxable year; (g) An additional forty dollars ($40) credit for taxpayer's spouse if a separate return is made by the taxpayer and if the taxpayer's spouse is blind, and, for <br>the calendar year in which the taxable year of the taxpayer begins, has no <br>Kentucky gross income and is not the dependent of another taxpayer; (h) In the case of nonresidents, the tax credits allowable under this subsection shall be the portion of the credits that are represented by the ratio of the <br>taxpayer's Kentucky adjusted gross income as determined by KRS <br>141.010(10), without the adjustments contained in (f) and (g) of that <br>subsection, to the taxpayer's adjusted gross income as defined in Section 62 of <br>the Internal Revenue Code. However, in the case of a married nonresident <br>taxpayer with income from Kentucky sources, whose spouse has no income <br>from Kentucky sources, the taxpayer shall determine allowable tax credit(s) by <br>either: <br>1. The method contained above applied to the taxpayer's tax credit(s), <br>excluding credits for a spouse and dependents; or 2. Prorating the taxpayer's tax credit(s) plus the tax credits for the <br>taxpayer's spouse and dependents by the ratio of the taxpayer's Kentucky <br>adjusted gross income as determined by KRS 141.010(10), without the <br>adjustments contained in (f) and (g) of that subsection, to the total joint <br>federal adjusted gross income of the taxpayer and the taxpayer's spouse; (i) In the case of an individual who becomes a resident of Kentucky during the taxable year, the tax credits allowable under this subsection shall be the <br>portion of the credits represented by the ratio of the taxpayer's Kentucky <br>adjusted gross income as determined by subsection (10) of KRS 141.010, <br>without the adjustments contained in paragraphs (f) and (g) of that subsection, <br>to the taxpayer's adjusted gross income as defined in Section 62 of the Internal <br>Revenue Code; (j) In the case of a fiduciary, other than an estate, the allowable tax credit shall be two dollars ($2); (k) In the case of an estate, the allowable tax credit shall be twenty dollars ($20); <br>(l) An additional twenty dollars ($20) credit shall be allowed if the taxpayer is a member of the Kentucky National Guard at the close of the taxable year. (4) An annual tax shall be paid for each taxable year as specified in this section upon the entire net income except as herein provided, from all tangible property located <br>in this state, from all intangible property that has acquired a business situs in this <br>state, and from business, trade, profession, occupation, or other activities carried on <br>in this state, by natural persons not residents of this state. A nonresident individual <br>shall be taxable only upon the amount of income received by the individual from <br>labor performed, business done, or from other activities in this state, from tangible <br>property located in this state, and from intangible property which has acquired a <br>business situs in this state; provided, however, that the situs of intangible personal <br>property shall be at the residence of the real or beneficial owner and not at the <br>residence of a trustee having custody or possession thereof. The remainder of the <br>income received by such nonresident shall be deemed nontaxable by this state. (5) Subject to the provisions of KRS 141.081, any individual may elect to pay the annual tax imposed by KRS 141.023 in lieu of the tax levied under this section. (6) An individual who becomes a resident of Kentucky during the taxable year is subject to taxation as prescribed in subsection (4) of this section prior to <br>establishing such residence and as prescribed in subsection (1) of this section <br>following the establishment of such residence. (7) An individual who becomes a nonresident of Kentucky during the taxable year is subject to taxation, as prescribed in subsection (1) of this section, during that <br>portion of the taxable year that the individual is a resident and, as prescribed in <br>subsection (4) of this section, during that portion of the taxable year when the <br>individual is a nonresident. Effective: March 18, 2005 <br>History: Amended 2005 Ky. Acts ch. 168, sec. 5, effective March 18, 2005. -- Amended 1990 Ky. Acts ch. 476, Pt. VII D, sec. 632, effective April 11, 1990. -- <br>Amended 1976 Ky. Acts ch. 77, Pt. I, sec. 1. -- Amended 1974 Ky. Acts ch. 362, <br>sec. 1. -- Amended 1972 Ky. Acts ch. 84, Pt. II, sec. 2. -- Amended 1970 Ky. Acts <br>ch. 216, sec. 5. -- Amended 1966 Ky. Acts ch. 176, Part I, sec. 3. -- Amended 1964 <br>Ky. Acts ch. 76, sec. 1. -- Amended 1962 Ky. Acts ch. 124, sec. 2. -- Amended 1960 <br>Ky. Acts ch. 5, Art. III, sec. 2. -- Amended 1958 Ky. Acts ch. 3, sec. 1. -- Amended <br>1956 (4th Extra. Sess.) Ky. Acts ch. 4, sec. 2. -- Amended 1954 Ky. Acts ch. 79, <br>sec. 2. -- Amended 1952 Ky. Acts ch. 124, sec. 1. -- Amended 1948 Ky. Acts ch. 93, <br>sec. 2. -- Amended 1946 Ky. Acts ch. 234, sec. 6. -- Recodified 1942 Ky. Acts <br>ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 4281b-14. Legislative Research Commission Note (3/18/2005). 2005 Ky. Acts ch. 168, sec. 165, provides that this section shall apply to tax years beginning on or after January 1, <br>2005.
141.020 Levy of income tax on individuals -- Rate of normal tax -- Tax credits -- Income of nonresidents subject to tax -- Election to pay tax imposed by KRS <br>141.023. (1) An annual tax shall be paid for each taxable year by every resident individual of this state upon his entire net income as defined in this chapter. The tax shall be <br>determined by applying the rates in subsection (2) of this section to net income and <br>subtracting allowable tax credits provided in subsection (3) of this section. (2) (a) For taxable years beginning before January 1, 2005, the tax shall be determined by applying the following rates to net income: <br>1. Two percent (2%) of the amount of net income up to three thousand <br>dollars ($3,000); 2. Three percent (3%) of the amount of net income over three thousand <br>dollars ($3,000) and up to four thousand dollars ($4,000); 3. Four percent (4%) of the amount of net income over four thousand <br>dollars ($4,000) and up to five thousand dollars ($5,000); 4. Five percent (5%) of the amount of net income over five thousand <br>dollars ($5,000) and up to eight thousand dollars ($8,000); and 5. Six percent (6%) of the amount of net income over eight thousand <br>dollars ($8,000). (b) For taxable years beginning after December 31, 2004, the tax shall be determined by applying the following rates to net income: <br>1. Two percent (2%) of the amount of net income up to three thousand <br>dollars ($3,000); 2. Three percent (3%) of the amount of net income over three thousand <br>dollars ($3,000) and up to four thousand dollars ($4,000); 3. Four percent (4%) of the amount of net income over four thousand <br>dollars ($4,000) and up to five thousand dollars ($5,000); 4. Five percent (5%) of the amount of net income over five thousand <br>dollars ($5,000) and up to eight thousand dollars ($8,000); 5. Five and eight-tenths percent (5.8%) of the amount of net income over <br>eight thousand dollars ($8,000) and up to seventy-five thousand dollars <br>($75,000); and 6. Six percent (6%) of the amount of net income over seventy-five <br>thousand dollars ($75,000). (3) The following tax credits, when applicable, shall be deducted from the result obtained under subsection (2) to arrive at the annual tax: <br>(a) Twenty dollars ($20) for an unmarried individual; <br>(b) Twenty dollars ($20) for a married individual filing a separate return and an additional twenty dollars ($20) for the spouse of taxpayer if a separate return <br>is made by the taxpayer and if the spouse, for the calendar year in which the <br>taxable year of the taxpayer begins, had no Kentucky gross income and is not the dependent of another taxpayer; or forty dollars ($40) for married persons <br>filing a joint return, provided neither spouse is the dependent of another <br>taxpayer. The determination of marital status for the purpose of this section <br>shall be made in the manner prescribed in Section 153 of the Internal Revenue <br>Code; (c) Twenty dollars ($20) credit for each dependent. No credit shall be allowed for any dependent who has made a joint return with his spouse; (d) An additional forty dollars ($40) credit if the taxpayer has attained the age of sixty-five (65) before the close of the taxable year; (e) An additional forty dollars ($40) credit for taxpayer's spouse if a separate return is made by the taxpayer and if the taxpayer's spouse has attained the age <br>of sixty-five (65) before the close of the taxable year, and, for the calendar <br>year in which the taxable year of the taxpayer begins, has no Kentucky gross <br>income and is not the dependent of another taxpayer; (f) An additional forty dollars ($40) credit if the taxpayer is blind at the close of the taxable year; (g) An additional forty dollars ($40) credit for taxpayer's spouse if a separate return is made by the taxpayer and if the taxpayer's spouse is blind, and, for <br>the calendar year in which the taxable year of the taxpayer begins, has no <br>Kentucky gross income and is not the dependent of another taxpayer; (h) In the case of nonresidents, the tax credits allowable under this subsection shall be the portion of the credits that are represented by the ratio of the <br>taxpayer's Kentucky adjusted gross income as determined by KRS <br>141.010(10), without the adjustments contained in (f) and (g) of that <br>subsection, to the taxpayer's adjusted gross income as defined in Section 62 of <br>the Internal Revenue Code. However, in the case of a married nonresident <br>taxpayer with income from Kentucky sources, whose spouse has no income <br>from Kentucky sources, the taxpayer shall determine allowable tax credit(s) by <br>either: <br>1. The method contained above applied to the taxpayer's tax credit(s), <br>excluding credits for a spouse and dependents; or 2. Prorating the taxpayer's tax credit(s) plus the tax credits for the <br>taxpayer's spouse and dependents by the ratio of the taxpayer's Kentucky <br>adjusted gross income as determined by KRS 141.010(10), without the <br>adjustments contained in (f) and (g) of that subsection, to the total joint <br>federal adjusted gross income of the taxpayer and the taxpayer's spouse; (i) In the case of an individual who becomes a resident of Kentucky during the taxable year, the tax credits allowable under this subsection shall be the <br>portion of the credits represented by the ratio of the taxpayer's Kentucky <br>adjusted gross income as determined by subsection (10) of KRS 141.010, <br>without the adjustments contained in paragraphs (f) and (g) of that subsection, <br>to the taxpayer's adjusted gross income as defined in Section 62 of the Internal <br>Revenue Code; (j) In the case of a fiduciary, other than an estate, the allowable tax credit shall be two dollars ($2); (k) In the case of an estate, the allowable tax credit shall be twenty dollars ($20); <br>(l) An additional twenty dollars ($20) credit shall be allowed if the taxpayer is a member of the Kentucky National Guard at the close of the taxable year. (4) An annual tax shall be paid for each taxable year as specified in this section upon the entire net income except as herein provided, from all tangible property located <br>in this state, from all intangible property that has acquired a business situs in this <br>state, and from business, trade, profession, occupation, or other activities carried on <br>in this state, by natural persons not residents of this state. A nonresident individual <br>shall be taxable only upon the amount of income received by the individual from <br>labor performed, business done, or from other activities in this state, from tangible <br>property located in this state, and from intangible property which has acquired a <br>business situs in this state; provided, however, that the situs of intangible personal <br>property shall be at the residence of the real or beneficial owner and not at the <br>residence of a trustee having custody or possession thereof. The remainder of the <br>income received by such nonresident shall be deemed nontaxable by this state. (5) Subject to the provisions of KRS 141.081, any individual may elect to pay the annual tax imposed by KRS 141.023 in lieu of the tax levied under this section. (6) An individual who becomes a resident of Kentucky during the taxable year is subject to taxation as prescribed in subsection (4) of this section prior to <br>establishing such residence and as prescribed in subsection (1) of this section <br>following the establishment of such residence. (7) An individual who becomes a nonresident of Kentucky during the taxable year is subject to taxation, as prescribed in subsection (1) of this section, during that <br>portion of the taxable year that the individual is a resident and, as prescribed in <br>subsection (4) of this section, during that portion of the taxable year when the <br>individual is a nonresident. Effective: March 18, 2005 <br>History: Amended 2005 Ky. Acts ch. 168, sec. 5, effective March 18, 2005. -- Amended 1990 Ky. Acts ch. 476, Pt. VII D, sec. 632, effective April 11, 1990. -- <br>Amended 1976 Ky. Acts ch. 77, Pt. I, sec. 1. -- Amended 1974 Ky. Acts ch. 362, <br>sec. 1. -- Amended 1972 Ky. Acts ch. 84, Pt. II, sec. 2. -- Amended 1970 Ky. Acts <br>ch. 216, sec. 5. -- Amended 1966 Ky. Acts ch. 176, Part I, sec. 3. -- Amended 1964 <br>Ky. Acts ch. 76, sec. 1. -- Amended 1962 Ky. Acts ch. 124, sec. 2. -- Amended 1960 <br>Ky. Acts ch. 5, Art. III, sec. 2. -- Amended 1958 Ky. Acts ch. 3, sec. 1. -- Amended <br>1956 (4th Extra. Sess.) Ky. Acts ch. 4, sec. 2. -- Amended 1954 Ky. Acts ch. 79, <br>sec. 2. -- Amended 1952 Ky. Acts ch. 124, sec. 1. -- Amended 1948 Ky. Acts ch. 93, <br>sec. 2. -- Amended 1946 Ky. Acts ch. 234, sec. 6. -- Recodified 1942 Ky. Acts <br>ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. sec. 4281b-14. Legislative Research Commission Note (3/18/2005). 2005 Ky. Acts ch. 168, sec. 165, provides that this section shall apply to tax years beginning on or after January 1, <br>2005.
