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Everyone, whether civilian or military, must satisfy the requirements of state sales tax when they register their vehicle. If you have questions, consult with your local Staff Judge Advocate (JAG) or inquire in your state of residence and the state to which you are being reassigned.
You can deduct sales tax on a vehicle purchase, but only the state and local sales tax. Youll only want to deduct sales tax if you paid more in state and local sales tax than you paid in state and local income tax.
Kentucky does not tax active duty military pay. All military pay received by members of the Armed Forces while on active duty can be excluded from Kentucky income.
Tax-exempt customers Some customers are exempt from paying sales tax under Kentucky law. Examples include government agencies, some nonprofit organizations, and merchants purchasing goods for resale. Sellers are required to collect a valid exemption or resale certificate from buyers to validate each exempt transaction.
PURCHASING A MOTOR VEHCILE WHILE STATIONED IN KENTUCKY *MILITARY PERSONNEL ARE ONLY EXEMPT FROM ROAD USAGE TAX IF THEY ARE PURCHASING A VEHICLE FROM A KENTUCKY LICENSED DEALER, AND THEY CLAIM A STATE OTHER THAN KENTUCKY AS THEIR HOME OF RECORD ON THEIR LES. THE LES CANNOT BE MORE THAN 120 DAYS OLD.
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Under Kentucky law, the Military Personnel Motor Vehicle Usage Tax Exemption provides a VUT exemption to members of the Armed Forces. This exemption is available only if a military member buys a vehicle from an authorized dealer in Kentucky. The vehicle may be new or used, but cannot be purchased in another state.
A 6% motor vehicle usage tax is levied upon the retail price of vehicles transferred in Kentucky. On used vehicles, the usage tax is 6% of the current average retail as listed in the NDA Used Car Guide or 6% of the total consideration paid.
If you no longer have a vehicle that you used to own, to avoid having to pay FUTURE taxes on that vehicle you must surrender the title to the County Clerk.

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