Georgetown, KY Local Taxes & Fees: Business Tax Classification (2026)

Article III of chapter 36 sets up the occupational license tax. Section 36-56(a) requires every person or business entity engaged in any for-profit business, and anyone required to make a filing with the Internal Revenue Service or the state department of revenue, to file and pay the tax for the privilege of engaging in those activities in the city. The measure has two parts, each at one percent: all wages and compensation paid or payable in the city for work done there by residents and nonresidents who are employees, and the net profit from business conducted in the city by a resident or nonresident business entity.

Section 36-56(b) requires every business entity to apply for and obtain an occupational license before commencing business or on a change of business status. Licensees must report changes of address or cessation of business, and the license must be displayed prominently at each physical place of business. Businesses with no physical location must produce it on request for the Georgetown-Scott County Revenue Commission's Business License Inspector or any city inspection official.

The code classifies the base by entity and by activity. Entities with payroll and sales both inside and outside the city apportion net profit by a payroll factor plus a sales factor divided by two; entities with only sales apportion by the sales factor. Partnerships, S corporations and other pass-through entities are taxed on income before it passes through to owners (36-56(h)). A general contractor that is not a local business must post a $275.00 cash bond at registration, list its subcontractors when applying for a building permit, and file employee withholding monthly. A business with no physical location in the city for over six uninterrupted months, other than a transient business, also posts a $275.00 cash bond (36-56(i) and (j)).

Section 36-57 lists exemptions, including domestic servants, temporary or casual farm labor, ordained ministers in their religious duties, National Guard training pay, and precinct workers. Residents and workers aged 65 and older owe no tax on the first $10,000.00 of compensation or sole proprietor net profit earned in the city. Banks, life insurance companies, licensed alcohol manufacturers and traffickers (on that portion of net profit) and public service corporations paying state-assessed ad valorem tax are exempt from the net profit measure.