How to Create an LLC in Kentucky

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How to Form an LLC in Kentucky:
5 Simple Steps to Get Started
According to the IRS, each state may use different regulations around forming an LLC, and you should check with your state if you’re interested in starting a Limited Liability Company. To simplify the process of forming an LLC in the Commonwealth (state) of Kentucky, we’ve put together a step-by-step guide to detail each step of the process and answer any questions you may have.

Step 1
Name Your Kentucky LLC

Your first consideration when choosing a name for your LLC is that it be unique from any other business in Kentucky. You can quickly and easily do a name check on the Kentucky Secretary of State website business name database to verify the business name you want is available. For a $15 fee, you can reserve a name for 120 days by filing the Reservation or Renewal of Reserved Name (Form RES) by mail.

In order to comply with Kentucky state law, your company’s name must contain some form of the term “Limited Liability Company.” This can appear in several different formats from the whole phrase written out to several appropriate abbreviations. “Limited Company,” “LLC,” and “LC” are all considered appropriate ways to adorn your moniker. In addition, the words “Limited” and “Company” may be abbreviated as “Ltd.” and “Co.” respectively.

Step 2
Appoint a Registered Agent in Kentucky

Kentucky requires that any LLC have a registered agent for service of process. This means your LLC must have an entity that agrees to physically accept any legal papers on the company’s behalf should it be sued. This entity does not have to be an individual person. The registered agent can be any resident of Kentucky or a business entity authorized to do business in Kentucky so long as the agent has a physical street address within the state.

Step 3
File Kentucky Articles of Organization
To officially create your LLC in Kentucky, you’ll need to complete Articles of Organization for a Limited Liability Company (Form KLC) and file them with the Kentucky Secretary of State. For a $40 fee, this can be done either online (you’ll need to create an account first) or by mail. To complete this form you will need to know the following:
  1. The final name and address of your LLC
  2. The name and address of the company’s registered agent
  3. Whether the LLC will be member-managed or manager-managed
  4. The size of the LLC (more or fewer than 50 employees)
  5. Type of business
  6. Whether the LLC is owned by women, veterans, or minorities
  7. The effective date of the LLC

Step 4
Create an Operating Agreement

You may want to consider preparing an operating agreement to outline the ownership and operating procedures for your LLC.

Though not required by the state, an operating agreement will set the guidelines for running your company. This does not need to be filed with the state, but it can go a long way toward ensuring your company’s success.

Step 5
Apply for an EIN and Review Tax Requirements

An IRS Employer Identification Number (EIN) is required of your LLC unless it is a single-member LLC with no employees. Obtaining an EIN is as easy as completing the application on the IRS website.

It’s possible your company will need to register with the Kentucky Department of Revenue (DOR). Whether or not your company needs to follow this step will depend on the exact types of taxes it will be collecting and/or has been collecting from the state and whether you have employees. The Kentucky Tax Registration Application, Form 10A100, can be filed online or by mail.

If your LLC will be selling a physical product, you’ll need to register for a sellers permit through the Kentucky Department of Revenue website (you’ll need to create an account to access the site). This will allow you to collect sales tax on taxable sales. Additionally, if you have employees, you’ll need to register for Unemployment Insurance Tax through the Kentucky Office of Employment and Training and also register for Employee Withholding Tax through the Kentucky Department of Revenue.

Other Considerations
Foreign LLCs and Business Licenses
Foreign LLCs

If your company is a foreign LLC, also referred to as an out-of-state LLC, wanting to do business in Kentucky, you’ll need to follow all the steps outlined above with a few minor differences.

You will need to file a Certificate of Authority (Foreign Business Entity) (Form FBE) with the Kentucky Secretary of State. This can be done online (requires an account) or by mail.

The filing fee is $90.

Business Licenses

Some industries will require you to secure federal, state, and local licenses to legally operate in the state of Kentucky.

You can get federal licenses and perform a Kentucky license and permit search to find the appropriate licensing for your business.

Since business licenses and permits are issued at all levels of government and for such a variety of reasons, you should still do careful research or you can hire or use a professional service to do it for you.

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