Kentucky

Kentucky reverses policy on vehicle title transfers

Fayette County Clerk Don Blevins Jr. estimates that his office has had hundreds of vehicle title transfer applications on hold because of a state policy that made it more difficult for immigrants to register vehicles and get titles for them.

After hearing concerns from county clerks and conferring with other officials, the state Transportation Cabinet reversed its position Nov. 10 and found that a federal Individual Taxpayer Identification Number, or ITIN, was acceptable for titling a vehicle.

Blevins said he has been able to start sending those applications to Frankfort.

"It's not an immigration issue," he said. "The real issue here is to make sure that everybody is taxed fairly, properly titled and registered and, more importantly, insured before they drive a vehicle on the road in Kentucky."

For years, people who filed income tax returns could register and title vehicles even if they did not have Social Security numbers, did not have legal immigration status or were here legally but didn't meet certain other requirements.

The Kentucky Transportation Cabinet changed that policy in July.

A cabinet official sent a memo to county clerks July 12, saying the state no longer would allow the use of an ITIN instead of a Social Security number because FBI and Kentucky State Police investigators said its use for identification purposes in registering or titling motor vehicles was not permitted by the Internal Revenue Service.

People who didn't have Social Security numbers and the people who sold vehicles to them after the policy change was announced this summer were among those left in limbo, Blevins said.

A Kentucky driver's license and an immigration visa or passport stamped with a certain status were among the documents allowed for identification purposes.

Thousands of people in Kentucky with and without legal immigration documentation stood to be affected because they could not use the ITIN, Marilyn Daniel, an attorney with Maxwell Street Legal Clinic in Lexington, told the Herald-Leader in July.

Blevins said his office was turning away people because title applications that used tax ID numbers were being rejected by the state. The change also was affecting people who sold vehicles to people whose title applications were being rejected by the state

In Louisville, Jefferson County Clerk Bobbie Holsclaw said that from July until Nov. 10, her office had more than 1,000 applications on hold.

"It was a frustrating time for the clerk's office and for the purchaser and for the car dealer," said Holsclaw.

She said she now has sent the applications to Frankfort.

Madison County Clerk Kenny Barger said 10 to 15 applicants were affected there, including some people from outside the United States who were in Kentucky on student visas but didn't have Social Security numbers.

Holsclaw said most of the people affected in Jefferson County were immigrants, but she agreed that the broader issue was one of fairly and properly taxing, titling and registering car owners.

Blevins met with state transportation officials because he hoped that officials would reinstate the use of the ITIN for registering and titling vehicles.

In a Nov. 10 memo to county clerks, Rick Taylor, acting director of the Transportation Cabinet's Division of Motor Vehicle Licensing, clarified the state's position:

"An ITIN is valid for limited use. ... The department has carefully researched the law and engaged in numerous discussions of the ITIN issue with the IRS, the Kentucky Department of Revenue, Kentucky State Police, county clerks, and others ...," the memo said.

The memo said that titling and registering a vehicle "is a taxable event" and that the ITIN was acceptable documentation for taxation purposes.

"The salient issue is that an ITIN can be used — in fact, is intended for use — in paying taxes," Transportation Cabinet spokesman Chuck Wolfe said. "It cannot be used as proof of residency. The memo last July caused a great deal of confusion, as it turned out, and the second memo ... is an attempt at clarification."

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