How to Start an LLC in Kentucky
Here are the 7 steps to start a limited liability company (LLC) in Kentucky
For more information on how to form an LLC in any state, see the article How to Form an LLC.
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Learn about Kentucky LLC formation, including information on Registered Agents, naming rules, business licenses, and more.
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Creating an LLC in Kentucky
A limited liability company (LLC) offers many benefits to small businesses, including liability protection and tax advantages.
In order to form a Kentucky LLC, you must file Articles of Organization with the Kentucky Secretary of State, which costs $40.
However, you’ll first need to choose a name and registered agent for your Kentucky LLC. If you file online, you can have an LLC in Kentucky in 24 hours (or 2-4 weeks if you file by mail).
An LLC can be easily formed in Kentucky. Our step-by-step guide on How to Start an LLC in Kentucky will help you get started today. Find out more about LLCs and their benefits in our What is an LLC guide.
Step 1. Choose a Name for Your LLC Kentucky
Creating an LLC in Kentucky requires you to choose a business name before you can file a Articles of Organization. Be sure that your business name complies with the Kentucky naming requirements and can be searched by potential customers.
- Kentucky law requires an LLC name to contain the words “Limited Liability Company” or “Limited Company,” or the abbreviations “Ltd.,” “LLC,” or “LC.” “Limited” may be abbreviated as “Ltd.” or “LTD,” and “Company” as “Co.”
- It is not acceptable for your Kentucky LLC to have words associated with a government agency (FBI, Treasury, State Department, etc.).
- You should avoid using words or abbreviations that may make your LLC Kentucky appear to be a different type of entity, such as “LP” or “corporation”.
- There may be additional documentation and licensure paperwork required for certain restricted words (bank, lawyer, attorney, credit union, etc.).
- Check the state’s business name database to ensure the name you want is not already taken(including businesses no longer in operation)
See a complete list of Kentucky’ naming rules here.
Check URL availability: You are likely to need a web page even if you don’t think you do. Buying your domain name now will at least give you the option of having one in the future. It’s a good idea to check the URL availability before finalizing your Kentucky LLC name.
By filing a Reservation or Renewal of Reserved Name (Form RES) with the Secretary of State, you can reserve a name for up to 120 days. Reservations can be file both online or by mail. The cost of filing is $15.
An LLC stands for a Limited Liability Company. A simple business structure that is more flexible and offers many of the same benefits as a traditional corporation. For more information, see “What is a Limited Liability Company?”.
A DBA isn’t required for most LLCs. The LLC’s name can also be used as your company’s brand name, and you can accept checks and other forms of payment under that name. If you want to do business under a different name, you might want to register a DBA.
Step 2: Appoint Your Registered Agent in Kentucky
Your next step in forming an LLC in Kentucky is to appoint a Registered Agent, an individual or company authorized to receive legal and state mail on your behalf.
All Kentucky LLCs must have a registered agent. Please include your registered agent’s name and address on your Articles of Organization.
Registered Agent Requirements in Kentucky
To comply with Kentucky law, your LLC’s registered agent must be a resident or business entity that maintains a physical address in Kentucky. The “registered address” cannot be a P.O. box. It must be a real physical address that can be visited in person.
Although you do not have to submit this form to the Secretary of State, your business must record it. Learn more about Kentucky Registered Agents by reading our full guide.
A Registered Agent must be a Kentucky resident or a corporation authorised to conduct business in Kentucky, such as a registered agent service. You have the option of electing someone from your company, including yourself.
You should complete and file a Statement of Change of Registered Agent form with the Kentucky Secretary of State to change your registered agent in Kentucky. The Kentucky Statement of Change of Registered Agent is a $10 document that must be filed by mail, in person, or online.
Are You looking for a Registered Agent?
Wise Business Plans offers a free year of registered agent service when forming an LLC in Kentucky.
Step 3.Prepare and File the Articles of Organization
To create a Kentucky LLC, you will need to file Articles of Organization (Form KLC) with the Kentucky Secretary of State. You may apply online, by mail, or in person.
There is a $40 filing fee online and by mail. You must send the original and a copy of your certificate if you file by mail.
You will receive a duplicate form back from the state once it receives your documents.
It may take up to 4-5 business days to process a mailed submission.
If you choose one of our business formation services, we can handle this step for you.
The following information is typically required to create a Articles of Organization:
- Your LLC name and principal place of business.
- Name, address, and signature of the LLC’s registered agent
- Decide whether your Kentucky LLC will be member-managed or manager-managed. Indicate the names and addresses of each member and manager.
- The reason for forming the LLC in Kentucky.
- Name and address of the LLC’s organizer.
- The effective date of the certificate,
- The person forming the LLC must sign the Certificate.
Foreign LLCs: LLCs that are based in another state but intend to conduct business in Kentucky must complete a form called the Qualification of Foreign LLC.
A filing fee of $90 also applies to this form, and you need to attach your state’s certificate of good standing.
Two Ways to File the Articles of Organization
The 1st option is:
File Online with the Kentucky Secretary of State
The 2nd option is:
Filing the Articles of Organization by Mail
There is a state filing of $40 payable to the “Kentucky State Treasurer”. (nonrefundable)
Mailing Address:Michael G. Adams Office of the Secretary of State
P.O. Box 718
Frankfort, KY 40602
Office Address:Room 154,Capitol Building
700 Capital Ave.
Frankfort, KY 40601
In a member-managed LLC, the members (owners) take on the business’s daily responsibilities. Manager-managed LLCs are managed by managers who are elected by the members. Those who manage your LLC will have the authority to do a wide range of tasks-from hiring staff to opening bank accounts.
When an LLC conducts business in the state where it was formed, it is referred to as a “domestic LLC.” Normally, when we talk about an LLC, we’re talking about a domestic one. When an existing LLC wants to expand its operations to another state, it must form a foreign LLC.
Step 4. Get a Certificate From the State
Upon filing your Articles of Organization, the secretary of state will review it. As soon as the Articles of Organization is approved, the LLC becomes a legal entity.
By obtaining this certificate, LLCs will be able to obtain an Employer Identification Number (EIN), licenses, and business accounts.
Step 5. Write an Kentucky LLC Operating Agreement
An operating agreement is a legally-binding document that sets out how your LLC will operate, from the voting process to mergers.
Operating agreements are not required in Kentucky, but they are an essential part of your business.
Written operating agreements are helpful for different reasons, including resolving disputes over financial agreements and other potential litigation.
The LLC declaration can prove that your LLC is a separate entity, which can help preserve your limited liability.
An operating agreement ensures that all business owners are on the same page and reduces the possibility of future conflict.
How should an operating agreement be drafted?
The operating agreement should detail the LLC’s overall business purpose and other important matters, such as how the company will be taxed and how new members will be accepted. Legal agreements can clarify several important concerns, such as:
- Who makes decisions for the company, especially those who decide if partners disagree.
- Who is responsible for different aspects of the business as well as for strategic decisions.
- If a partner leaves the company, what will happen to their ownership interests in the corporation.
- The members and their contributions
- How profits and losses will be divided
- Procedures for admitting new members and removing outgoing members
In Kentucky, you can include just about anything in your operating agreement, as long as it doesn’t violate the state law or the Articles of Organization.
An Operating Agreement is not required for a single-member or multi-member LLC. However, an Operating Agreement is still recommended for the members’ extra protection against personal liability.
Although Kentucky does not require LLCs to have an Operating Agreement, it is in the owner’s best interests to do so. You are not, however, required to file your Operating Agreement with the Secretary of State of Kentucky.
Step 6. Get an EIN for Your Kentucky LLC
Basically, an employer identification number (EIN) is a social security number for your LLC in Kentucky.
To identify your LLC for tax purposes, the Internal Revenue Service assigns a nine-digit Employer Identification Number (EIN). You can apply for your EIN either by mail or online.
An EIN is used for the following purposes:
- Manage state and federal taxes
- Create a business bank account
- Hire employees
Get an EIN Number in Kentucky
Getting an EIN number is easy and free, There are two ways to get an EIN number in Kentucky.
The 1st option is:
Apply online for an EIN from the IRS
The 2nd option is:
Get an EIN by Mail or Fax
Address to Mail
Mail to:
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
An EIN is required for any LLC with employees or more than one member.
A tax classification will be discussed with you when you obtain an EIN. In most cases, LLCs choose the default status.
Some LLCs can reduce their federal tax obligation by electing S corporation status. Consult with a local accountant to find out which option is best for you.
Even though sole proprietors without employees are not required to have an EIN, you should still get one. Some banks require you to open a bank account before you can use your credit card, which can help reduce the risk of identity theft. Businesses in Kentucky are required to file taxes and employee reports.
Apply online (available for most businesses) or call the IRS at (800) 829-4933 to get an EIN number right away. It is highly recommended that you review IRS Form SS-4 and Form SS-4 Instructions before calling so that you are prepared to answer the IRS’s questions about your business.
Step 7. File Annual Report
Every year, by June 30, all Kentucky LLCs must file an annual report with the Secretary of State. You must submit the names and addresses of your LLC’s members and managers, confirm the principal and registered office/agent, and sign and date the report when filing your first annual report.
The same information must be confirmed in subsequent annual reports. The first annual report is due between January 1 and June 30 of the calendar year following the LLC’s formation.
Fee: The filing fee is $15. The report can be submitted via the online.
Due Date: Kentucky LLC annual reports are due by June 30 every year.
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What to do After Forming Your Kentucky LLC
Keep your personal and business assets separate
Your personal assets (such as your home, car, and other valuables) may be at risk when your Kentucky LLC is sued if they are mixed with your business accounts.
Here are some steps you can take to protect your LLC in Kentucky:
1. Create a Business Plan:
If you decide that a Kentucky LLC will be a good choice for your business in Kentucky, your next step is to create a business plan (although it is not required), so that you have a roadmap for what you will do and how you will accomplish it.
Free: Business Plans Examples
Do you need help creating a business plan? Check out these six free, proven business plan examples from different industries to help you write your own.
2. Open a Bank Account
As soon as your LLC is officially formed, you should open a business bank account. Why? Keeping separate bank accounts will help you maintain the legal distinction between the LLC and you (the owner).
Because LLCs are limited liability companies, creditors and litigants can’t take your assets.
It is essential for small business owners to partner with the right bank. Find out which banks offer the best business checking accounts, have low or no fees, ATM accessibility, and interest-earning accounts as well as online or mobile banking tools.
Recommended: Check out our business bank account page to learn which banks offer the best business check accounts, ATM access, interest-bearing accounts, and online and mobile banking options for businesses.
3. Obtaining a business credit card:
- Allows you to separate personal and business expenses.
- Develops your company’s credit history, which can be helpful to raise capital (e.g., small business loans) later.
4. Hiring a business accountant:
- It prevents your business from overpaying taxes while preventing penalties, fines, and other costly tax mistakes.
- Gives you more time to focus on your growing business by simplifying bookkeeping and payroll.
- Manage your business’s funding more effectively. Find out where extra profit or loss can be made
Getting Business Insurance for Your LLC
You can manage risks and grow your LLC with business insurance. Here are the most common types:
- General liability insurance protects your business from lawsuits. Most small businesses purchase general liability coverage.
- Professional liability insurance protects professionals and businesses from claims of negligence from their clients or customers. Liability insurance typically covers negligence, copyright infringement, personal injury, and more.
- Workers’ compensation insurance: Covers illnesses, injuries, and deaths resulting from a worker’s work.
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Let us help you with your business insurance needs.
- General business liability insurance
- Medical insurance
- Term life insurance
- Workers’ Comp
- Surety bonds
- Commercial auto
Create Your Business Website
A website is an important step in legitimizing your business. It is essential for all businesses. You are missing out on a large percentage of potential customers and revenue if you don’t have a website, even if your business is too small or in an offline industry.
More than 90% of consumers begin their search for products and services online. If you don’t have a website that is ready to welcome your customers, then they will simply find your competitors.
Here are the main reasons why you shouldn’t delay building your website:
- Every respectable firm has a website. When it comes to getting your firm online, size or sector isn’t a concern.
- Creating a basic website has never been easier, thanks to website builder tools like the GoDaddy Website Builder. To design a website, you don’t need to hire a web designer or developer.
Recommended: If you want to enhance your conversion rates and maximize revenue in order to help expand your business and meet objectives, you should always hire a professional business website design company to build your business website.
Wise Business Plans is a leading web design company, We have created over 2000 + websites across 20 countries for our clients but we are physically based in 7 major cities in the United States including Alabama web design, Pennsylvania, Las Vegas, Colorado Springs, Iowa, Michigan and San Diego.
Kentucky LLC FAQs
A Kentucky limited liability company (LLC) costs $40 to form. When the LLC’s Articles of Organization are filed with the Kentucky Secretary of State, this fee is paid.
If you file online, you can have an LLC in Kentucky in 24 hours (or 2-4 weeks if you file by mail).
Simply follow these three steps to dissolve an LLC in Kentucky:
Step 1: Comply with the terms of your Kentucky LLC Operating Agreement.
Step 2: Make sure your business’s tax accounts are closed.
Step 3: File the Dissolution Articles.
You must submit form Articles of Amendment to the Kentucky Secretary of State to amend your Kentucky LLC Articles of Organization (SOS). Once you’ve signed up with Northwest, you’ll find the form in your online account.
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