Kentucky Form 740-NP-R is a nonresident income tax return filed by a taxpayer who meets the following criteria:
- They were a nonresident of Kentucky during the entire tax year.
- They are a resident of one of the seven states that has a reciprocal agreement with Kentucky: Illinois, Indiana, Michigan, Ohio, Virginia, West Virginia, or Wisconsin.
- Their only income in Kentucky is from salaries or wages.
- Kentucky tax was withheld from their wages as reported on Form W-2.
- If they are a Virginia resident, they affirm that they commuted daily to a place of employment in Kentucky.
Form 740-NP-R is designed to be filed by a single individual, not a married couple. As the instructions on the form state:
Enter only the taxpayer's name for which the Kentucky wages and salaries were earned in the name box above. Do not include your spouse's name. If both spouses earned only Kentucky wages and salaries as a resident of a reciprocal state, each spouse must file a separate Form 740-NP-R.
In TaxSlayer Pro, when preparing a tax return for a couple filing jointly in the federal return, you can prepare separate Forms 740-NP-R for the taxpayer and the spouse, however the form will only be e-fileable in a return that includes one form prepared for the taxpayer. A return that includes Form 740-NP-R prepared for the spouse cannot be e-filed, whether or not there is also one prepared for the taxpayer.
In a tax return being filed jointly, if only one spouse needs to file Form 740-NP-R, consider making that spouse the primary taxpayer in the federal return so that the form can be e-filed.
Otherwise, in a tax return where both spouses need to prepare Form 740-NP-R due to both meeting the above criteria, here is a strategy you can follow to be able to prepare and e-file both forms.
- Prepare the federal tax return for the couple and a Kentucky Form 740-NP-R for the taxpayer. Electronically file them and be sure both are accepted.
- Open the federal return, navigate to the Name & Address menu under Personal Information and swap the taxpayer and spouse information. (Before making the changes, have a printed copy of the return handy or a screen shot of the menu.)
- Change the spouse SSN to any 9-digit number. (This is a temporary change, necessary since you can't have the same SSN for the taxpayer and the spouse at the same time.)
- Change the taxpayer's name, SSN, and birth date to the spouse's information.
- Change the spouse's name, SSN, and birth date to the taxpayer's information.
- When finished swapping the taxpayer and spouse information, exit back to the main 1040 window and navigate to the Income menu, then to Wages, Salaries, Tips (W-2).
- Select each W-2, and at the top left under the Employee drop down menu change Taxpayer to Spouse or Spouse to Taxpayer, whichever is appropriate.
- When finished swapping the W-2s, exit back to the main 1040 window, then open the Kentucky nonresident return. The existing Form 740-NP-R will now be updated to reflect the changes.
Unless the taxpayer wishes to contribute to one of the funds on the form, it is ready to be printed and electronically filed.
Additional Information