Starting an LLC in Kentucky is easy, just follow these simple steps:
To form an LLC in Kentucky you will need to file the Articles of Organization with the Kentucky Secretary of State, which costs $40. You can apply online, by mail, or in-person. The Articles of Organization is the legal document that officially creates your Kentucky Limited Liability Company.
Follow the step-by-step guide below to start your Kentucky LLC today and get your business up and running.
STEP 1: Name your Kentucky LLC
Choosing a company name is the first and most important step in starting your Kentucky LLC. Be sure to choose a name that complies with Kentucky naming requirements and is easily searchable by potential clients.
1. Follow the naming guidelines:
- Your name must include the phrase “limited liability company” or one of its abbreviations (LLC or L.L.C.).
- Your name cannot include words that could confuse your LLC with a government agency (FBI, Treasury, State Department, etc.).
- Restricted words (e.g. Bank, Attorney, University) may require additional paperwork and a licensed individual, such as a doctor or lawyer, to be part of your LLC.
2. Is the name available in Kentucky? Make sure the name you want isn't already taken by doing a name search on the State of Kentucky website.
3. Is the URL available? We recommend that you check to see if your business name is available as a web domain. Even if you don't plan to make a business website today, you may want to buy the URL in order to prevent others from acquiring it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
FAQ: Naming a Kentucky LLC
Do I need to get a DBA or Assumed Name for my business?
Most LLCs do not need a DBA. The name of the LLC can serve as your company’s brand name and you can accept checks and other payments under that name as well. However, you may wish to register a DBA if you would like to conduct business under another name.
To learn more about DBAs in your state, read our How to File a DBA guide.
STEP 2: Choose a Registered Agent in Kentucky
You are required to nominate an Kentucky registered agent for your Kentucky LLC.
What is a Registered Agent? A registered agent is an individual or business entity responsible for receiving important legal documents on behalf of your business. Think of your registered agent as your business's point of contact with the state.
Who can be a Registered Agent? a Registered Agent must be a resident of Kentucky or a corporation, such as a registered agent service, authorized to transact business in Kentucky. You may elect an individual within the company including yourself.
Recommended: ZenBusiness provides the first year of registered agent service free with LLC formation ($39 + State Fees)
FAQ: Nominating a Registered Agent
Can I be my own Registered Agent?
Yes. You or anyone else in your company can serve as the registered agent for your LLC.
Read more about being your own registered agent.
Is a Registered Agent service worth it?
Using a professional registered agent service is an affordable way to manage government filings for your LLC. For most businesses, the advantages of using a professional service significantly outweigh the annual costs.
For more information, read our article on Kentucky registered agents.
STEP 3: File Your Kentucky LLC Articles of Organization
To register your LLC, you will need to file the Articles of Organization with the State of Kentucky. This can be done online, by mail, or in-person.
When filing your Articles of Organization, you will need to state whether your Kentucky LLC will be member-managed or manager-managed. Before you file, read our member-managed vs manager-managed guide to help you choose the best management structure for your LLC.
File the Articles of Organization
OPTION 1: File Online with the State of Kentucky
- OR -
OPTION 2: File by Mail or In-Person
State Filing Cost: $40, payable to "Kentucky State Treasurer" (Nonrefundable)
Alison Lundergan Grimes
Office of the Secretary of State
PO Box 718
Frankfort, KY 40602
Room 154, Capitol Building
700 Capital Avenue
Frankfort, KY 40601
Hours of Operation: 8:00 AM-4:30 PM ET
If you’re expanding your existing LLC to the State of Kentucky, you will need to form a Foreign LLC.
FAQ: Filing LLC Documents
What is the processing time to form my Kentucky LCC?
Immediately online, 3 to 5 days by mail.
What is the difference between a domestic Kentucky LLC and foreign LLC?
An LLC is referred to as a "domestic LLC" when it conducts business in the state where it was formed. Normally when we refer to an LLC we are actually referring to a domestic LLC. A foreign LLC must be formed when an existing LLC wishes to expand its business to another state.
Read our What Is a Foreign LLC article to learn more.
STEP 4: Create Your Kentucky LLC Operating Agreement
An operating agreement is not required in Kentucky, but it's a good practice to have one.
What is an operating agreement? An operating agreement is a legal document outlining the ownership and operating procedures of an LLC.
Why are operating agreements important? A comprehensive operating agreement ensures that all business owners are on the same page and reduces the risk of future conflict.
For more information on operating agreements, read our Kentucky LLC operating agreement guide.
Recommended: Download a template or create a Free Operating Agreement using our tool.
FAQ: Creating a Kentucky Operating Agreement
Do I need to file my operating agreement with the state of Kentucky?
No. The operating agreement is an internal document that you should keep on file for future reference. However, many states do legally require LLCs to have an operating agreement in place.
STEP 5: Get an EIN
What is an EIN? EIN stands for Employer Identification Number. EINs are a nine-digit number assigned by the Internal Revenue Service (IRS) to help identify businesses for tax purposes. It is essentially a Social Security number for a business.
An EIN is sometimes referred to as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number (FTIN).
Why do I need an EIN? An EIN is required to:
- Open a business bank account
- File and manage Federal and State Taxes
- Hire employees
What if I already have an EIN for my sole proprietorship? The IRS requires that sole proprietorships get a new EIN when converting to an LLC.
Where do I get an EIN? You can get an EIN for free from the IRS. Getting an EIN is an easy process that can be done online or by mail.
FOR INTERNATIONAL EIN APPLICANTS: You do not need a SSN to get an EIN. For more information, read our How to Get an EIN as a Foreign Person guide.
FAQ: Getting a Kentucky EIN
How do I get an EIN if I don’t have a Social Security number?
An SSN is not required to get an EIN. You can simply fill out IRS Form SS-4 and leave section 7b blank. Then call the IRS at (267) 941-1099 to complete your application. Learn more about applying as an international applicant.
What tax structure should I choose for my LLC?
Do I need an EIN for my LLC?
All LLCs with employees, or any LLC with more than one member, must have an EIN. This is required by the IRS.
Learn why we recommend always getting an EIN and how to get one for free in our Do I Need an EIN for an LLC guide.
Considering Using an LLC Formation Service?
We reviewed and ranked the top 5 LLC formation services.
Find out which is best for you.
Protect Your Business & Personal Assets
Business Banking for Personal Asset Protection
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your LLC is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
You can protect your business with these two steps:
1. Opening a business bank account:
- Separates your personal assets from your company's assets, which is necessary for personal asset protection.
- Makes accounting and tax filing easier.
Need help finding your EIN for your loan application? Visit our EIN Lookup guide for help.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
2. Getting a business credit card:
- Helps you separate personal and business expenses.
- Builds your company's credit history, which can be useful to raise capital later on.
Recommended: Learn more about the best small business credit cards.
Business insurance helps you manage risks and focus on growing your business. The most common types of business insurance are:
- General Liability Insurance: A broad insurance policy that protects your business from lawsuits. Most small businesses get general liability insurance.
- Professional Liability Insurance: A business insurance for professional service providers (consultants, accountants, etc.) that covers claims of malpractice and other business errors.
- Workers' Compensation Insurance: A type of insurance that provides coverage for employees’ job-related illnesses, injuries, or deaths. In Kentucky, businesses with five or more employees are required by law to have workers' compensation insurance. Note that officers and LLC members are counted as employees.
Find out how much it will cost to keep your business protected.Get Your Free Quote Today
Properly Sign Legal Documents
Improperly signing a document as yourself and not as a representative of the business can leave you open to personal liability. When signing legal documents on behalf of your company, you could follow this formula to avoid problems:
- Formal name of your business
- Your signature
- Your name
- Your position in the business as its authorized representative
See the image below for an example.
This ensures that you are signing on behalf of your LLC and not as yourself.
Learn more on how to protect your business & personal assets by reading our article - How to Maintain your LLC Corporate Veil.
Join the Conversation
We are here to guide you through your entrepreneurial journey, and are always looking at your feedback. Share your experiences in our comment box, chat with other entrepreneurs, or simply let us know how we're doing.
Keep Your Company Compliant
Kentucky Permits & Licenses
To operate your LLC you must comply with federal, state, and local government regulations. For example, restaurants likely need health permits, building permits, signage permits, etc.
The details of business licenses and permits vary from state to state. Make sure you read carefully. Don't be surprised if there are short classes required as well.
Fees for business licenses and permits will vary depending on what sort of license you are seeking to obtain.
Find out how to obtain necessary licenses and permits for your business or have a professional service do it for you:
- Federal: Use the U.S. Small Business Administration (SBA) guide.
- State: Use Kentucky's One Stop Business Portal to learn more about business licenses.
- Local: Contact your local county clerk and ask about local licenses and permits.
Recommended: If you are a first-time entrepreneur, consider having a professional service research your business’s licensing requirements. Our friends at Startup Savant have reviewed and ranked the top five license research services.
Kentucky LLC Tax Requirements
Depending on the nature of your business, you may be required to register for one or more forms of state tax.
If you are selling a physical product, you’ll typically need to register for a seller's permit through the Kentucky Department of Revenue website.
This certificate allows a business to collect sales tax on taxable sales.
Sales tax, also called "Sales and Use Tax," is a tax levied by states, counties, and municipalities on business transactions involving the exchange of certain taxable goods or services.
Read our sales tax guide to find out more.
If you have employees in Kentucky, you will have to register for the Unemployment Insurance Tax with the Kentucky Office of Employment and Training. You will also need to sign up for the Employee Withholding Tax with the Kentucky Department of Revenue.
Industry Specific Taxes
If your business falls within a specific industry, additional state taxes may apply. Most of these additional taxes apply to Hospitality or Service Industry businesses.
Federal LLC Tax Requirements
Most LLCs will need to report their income to the IRS each year using:
- Form 1065 Partnership Return (most multi-member LLCs use this form)
- Form 1040 Schedule C (most single-member LLCs use this form)
How you pay yourself as an owner will also affect your federal taxes. Visit our guide to learn more about how to pay yourself from your LLC.
Read our LLC Tax Guide to learn more about federal income taxes for LLCs.
File Your LLC Annual Report
Kentucky requires LLCs to file an annual report with the Secretary of State. This can be done online.
File Your Annual Report
File Online with the State of Kentucky
Avoid Automatic Dissolution
LLCs may face fines and even automatic dissolution when they miss one or more state filings. When this happens, LLC owners risk the loss of limited liability protection. A quality registered agent service can help prevent this outcome by notifying you of upcoming filing deadlines and by submitting reports on your behalf.
Recommended: ZenBusiness offers a reliable registered agent service and excellent customer support.
Get Help Starting a Business in Kentucky
We understand that creating an LLC and getting your business up and running comes with many challenges. To help you succeed, we compiled the best local resources in every major metro area in Kentucky. You can get free assistance in the following areas:
Make Running Your Business Easier
After starting a business, two of the most important things you can do are get professional accounting and hire the right employees. Streamlining these processes can save you time and money as your business grows.
If you plan to hire employees, stay compliant with the law by following these steps:
- Verify that new employees are able to work in the US
- Report employees as "new hires" to the State
- Provide workers' compensation insurance for employees
- Withhold employee taxes
- Print workplace compliance posters and place them in visible areas of your work space
Check out Kentucky's "Managing Employees" resource.
Recommended: Check out our Hiring for your Small Business Guide for resources like sample job descriptions, payroll service reviews, and more.
FAQ: Hiring Employees
What is the minimum wage in Kentucky?
The minimum wage in Kentucky is $7.25 per hour.
How often do I need to pay employees?
Kentucky requires wages to be paid at least twice per month.
Accounting For Your Kentucky LLC
It’s critical to get your books in order, even if you haven’t officially opened for business. A well-managed accounting system will help you:
- Track your business finances, including bills, expenses, and income.
- Simplify your annual tax filings.
You can maintain your accounting in two ways:
- Use a DIY accounting software. This can come with an increased risk of errors especially when starting a new business.
- Hire an accounting service. They can provide comprehensive advice to help optimize your bookkeeping and taxes as well as additional services such as payroll etc.
Recommended: For most small businesses, we recommend using a reputable accounting service. Schedule a free tax consultation for your business now to avoid costly errors in the future.
Interfacing with Clients and Customers
In the day-to-day of running a business, it's hard to be readily available for new clients or customers who want to contact you. For service-based businesses that don’t already have a brick-and-mortar location, a virtual office can solve this problem. You can get a dedicated business mailing address and a business phone number with call-forwarding so that you never need to worry about losing a potential customer.
Recommended: Opus Virtual Office can set up your businesses with a live receptionist and all the perks of a virtual office for a great price of $99/month. Plus, as a visitor of HowToStartAnLLC, you can save $200 today.
Women in Business Tools and Resources
If you have a woman-owned business, many resources are available to help you concentrate on your business’s growth:
- Funding - (ie. grants, investors, loans)
- Events - (ie. conferences, meetups)
- Guides - (ie. business formation, personal growth)
- Support - (ie. advice, communities, business strategies)
Our information and tools will provide educational sources, allow you to connect with other women entrepreneurs, and help you manage your business with ease.
TRUiC has created video guides to support and reinforce our on-page guides. These videos help to visualize the ideas and lessons that you need to know to create and run a successful business.
Check out our growing library of small business videos on the TRUiC YouTube channel.
Register as a Foreign LLC in Kentucky
Forming a foreign LLC allows your company to operate as one entity in multiple states. If you have an existing LLC and want to do business in Kentucky, you will need to register as a foreign LLC. This can be done by mail.
Register as a Foreign LLC in Kentucky
File by Mail with the Secretary of State
Fee: $90, payable to the Kentucky State Treasurer (Nonrefundable)
Alison Lundergan Grimes
Secretary of State
P.O. Box 718
Frankfort, KY 40602
How to Obtain a Certificate of Existence
A Certificate of Good Standing, known in Kentucky as a Certificate of Existence, verifies that your LLC was legally formed and has been properly maintained. Several instances where you might need to get one include:
- Seeking funding from banks or other lenders
- Forming your business as a foreign LLC in another state
- Obtaining or renewing specific business licenses or permits
You can order a Certificate of Existence online or by mail.
Order a Certificate of Existence
Dissolve Your Kentucky LLC
If at any point in the future you no longer wish to conduct business with your LLC, it is important to officially dissolve it. Failure to do so in a timely fashion can result in tax liabilities and penalties, or even legal trouble. To dissolve your LLC, there are two broad steps:
- Close your business tax accounts
- File the Articles of Dissolution
When you are ready to dissolve your LLC, follow the steps in our Kentucky LLC Dissolution Guide.
LLC: An LLC is a US business structure that offers the personal liability protection of a corporation with the pass-through taxation of a sole proprietorship or partnership.
DBA: A DBA, or doing business as name, is any name a business operates under that isn't its legal name.
Partnership: A partnership is an informal business structure owned by more than one individual that doesn't provide personal liability protection.