LOUISVILLE, Ky. (WDRB) -- Some Kentucky homeowners will face higher utility bills after the first of the year.

There is confusion around the new tax, because it will impact only additional properties you pay utilities on. But the tax does not apply to your primary residence. If you own one Kentucky home and live in it, you don't have to worry about the changes in residential utility sales taxes.

LG&E and KU said it has notified about 46,000 customers across its coverage area impacted by the change.

"Right now, what we're trying to do is reach those customers who have multiple properties in our system," said Liz Pratt, a spokeswoman for LG&E.

Water, gas and electric for additional properties like rental units or apartments you may rent out will be taxed the state's 6% sales tax starting Jan. 1. But there are some exemptions.

LG&E and KU wants customers to fill out and online form by Thursday to let them know which property is your primary residence.

Joe Arnold, vice president of strategic communications for Kentucky Electric Cooperatives said the change has many people calling to ask questions.

"Every co-op in the state — perhaps every utility in the state — is experiencing a high-call volume because there's a change," he said.

For rural communities, people should consider if they have multiple meters and can fill out an exemption form to have them considered all part of the primary address.

For example, Arnold said, "is that barn part of an agricultural operation or just as simply part of my house? Is that streetlight outside that I that might have a separate meter on it part of my house or is that considered part of a different commercial operation?"

Louisville Water said it has also sent notifications to its estimated 10,000 customers with multiple accounts under the same name about letting the company know which residence is the primary. Unlike LG&E and KU, Louisville Water wants to give a grace period and isn't charging the sales tax right away. It said it wants to be notified as soon as possible for exemptions but will accept forms as late as Feb 12, 2023. 

For landlords, like Kyle Noltemeyer in Louisville, it could depend on the size of home or complex and how the building is coded through the Kentucky Department of Revenue. 

"We have to fill out a lot of paperwork and hope that we're doing the right thing," he said.

Landlords can have tenants sign paper work that says they are occupying the landlord's home as their own primary residence to get an exemption to the tax. Noltemeyer said it could cost thousands if vacant apartments are taxed every time a tenant leaves.

"I think it'd be better to give people a lot of information and a lot of warning, and I don't feel like it's super clear," he said. "So the other questions are coming now, and no one wants to answer them because it's the end of the year."

Regarding landlords, The Kentucky Department of Revenue told WDRB News, "Under the provision of HB 8 enacted by the 2022 General Assembly, when the utility services are moved out of the tenant’s name back to the landlord or property owner, the utility charges are no longer for residential usage and become subject to the 6% sales tax."

The new rules through the state Department of Revenue take effect Jan 1, 2023, and that's just a few weeks away.

As for what to do if you have questions, the utility companies say refer to the  Department of Revenue.

When WDRB News asked the department for an interview Tuesday about the changes, we were directed to the frequently asked questions page then to lawmakers who wrote the tax change.

For the link to the exemption form for LG&E and KU click here. For the link for Louisville Water click here.

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