Kentucky Sales Tax Bill Update

ABMP has been working to clarify how Kentucky House Bill 8 (HB 8) will be implemented. HB 8 requires massage therapists to apply a 6 percent sales tax on massage therapy services. It will go into effect January 1, 2023.

ABMP has learned that taxes from massage therapy services will be collected by the Kentucky Department of Revenue (DOR) through the Sales and Use Tax Division. The reasoning behind the sales tax is because the legislature intends to reduce income tax in the coming years and sales tax is a way to offset this action.

Gift certificates redeemed after January 1, 2023, will be subject to the 6 percent sales tax, unless the massage is deemed “medically necessary.” In addition, all forms of payment for massage therapy are taxable, including online platforms such as Venmo, PayPal, or Zelle.

How Do I Start Collecting Sales Tax?
The DOR has provided step-by-step information to help massage therapists set up a sales and use tax account if they do not already have one. This is how massage therapists will begin charging and collecting sales tax on the total sales price for transactions services on or after January 1, 2023.
To remit tax to the DOR, practitioners and businesses without a sales and use tax account must register for an account number. You can complete an online registration for a sales and use tax account through the Kentucky Business One Stop Portal. Follow the steps below, and access the online user guide for further assistance.

  1. Create a user account in the Kentucky Business One Stop Portal
  2. Link your business using the CBI referenced below by clicking the “Link Your Business” icon on the One Stop home page; the CBI and security token will be issued once a massage therapist signs up on the site
    CBI Number: xxxxxxxxx
    Business Name: xxxxxxxx
    Security Token: xxxxxxxxx
  3. Return to the One Stop dashboard and click on your business from “My Businesses”
  4. Click “Apply for Additional Accounts” under the Tax Administration tab
  5. Answer “Yes” to the question: “Does your business make sales?”
  6. Provide a description of the services provided

Once you have a sales and use six-digit account number, you can start remitting sales tax from the dashboard screen. It has been suggested that massage therapists pay their sales tax either monthly or quarterly. Follow these steps:

  1. Click on the business name or CBI number
  2. Click on the Tax Administration tab
  3. Click on File Taxes
  4. Click on the sales tax account number
  5. Click on the filing period for which you want to submit the return

If you need help with this process or have other questions, contact the Sales and Use Tax Division at 502-564-5170 or by email at

Sales Tax Does Not Need to be Collected on Medically Necessary Massage
The 6 percent sales tax will be required for all massage therapy services, except when the massage service is medically necessary. Since HB 8 was signed into law, it was unclear what would be considered medically necessary.

ABMP learned that “medical necessity” is when a client has a prescription from practitioners who have prescriptive authority, such as doctors, chiropractors, primary care physicians, etc. The prescription can be written for a length of time covering the medically necessary massage. For example, March 1, 2023–February 28, 2024.

Prescriptions must be kept on file for five years after the final date issued. The Kentucky Revenue Cabinet will randomly audit massage therapists every 2–3 years. The cabinet will be looking for the prescription and records of dates clients were seen. The prescription does not need a diagnosis and SOAP notes are not required for the audit; however, SOAP notes are separately required in the massage therapy regulations.

ABMP recommends massage therapists begin notifying their clients as soon as possible to obtain prescriptions when possible and to inform them that a 6 percent sales tax on non-medically necessary services will be required after January 1, 2023.

ABMP also suggests massage therapists set up their sales and use tax accounts as soon as possible to allow enough time to complete the necessary tasks. Questions should be directed to the DOR at If you have general questions, contact the ABMP Government Relations Team at