FRANKFORT, Ky. — Kentucky small businesses that have recently hired employees and invested in equipment or technology could qualify for up to $25,000 in state income tax credits, with Gov. Andy Beshear urging eligible companies to apply by Nov. 1 to claim the benefit for the 2026 tax year.

Eligible businesses can receive tax credits ranging from $3,500 to $25,000 annually through the Kentucky Small Business Tax Credit program, which provides tax incentives to qualifying businesses that create jobs and make investments in their operations. To qualify, a small business must have added at least one net new full-time employee and invested at least $5,000 in qualifying equipment or technology during the previous 24 months.

Most for-profit Kentucky businesses with 50 or fewer full-time employees can qualify for the program. Eligible industries include construction, manufacturing, retail, services and wholesale businesses. "Kentucky's small businesses fuel our economy, and their success is a win for our entire commonwealth," Beshear said.

The state cautions that submitting an application does not guarantee approval, but complete applications received by Nov. 1 will be reviewed for potential 2026 tax-credit eligibility. Businesses can apply throughout the year, though applications submitted after Nov. 1 may not be eligible for the credit until the 2027 tax year.

Kentucky businesses approved through the Small Business Tax Credit program received more than $1.2 million in tax credits during the past year, while those companies invested more than $3.9 million in their businesses and created 352 jobs in Kentucky. Since the program began, it has helped support the creation of more than 5,100 jobs and generated more than $53.7 million in small-business investments, with more than $17.4 million in state tax credits allocated through the program since its inception.

The Kentucky Small Business Tax Credit is administered through KY Innovation, part of the Kentucky Cabinet for Economic Development. KY Innovation oversees programs designed to provide entrepreneurs and small businesses with access to capital, mentoring, advocacy and other resources, operating through six regional innovation hubs across Kentucky. For more information, businesses can visit NewKentuckyHome.ky.gov/Entrepreneurship/KSBTC, contact the Kentucky Cabinet for Economic Development at 800-626-2930, or email info@kyinnovation.com.