How to start an LLC in Kentucky in 2024

Launching a new business in Kentucky can be surprisingly affordable. If you choose to create a limited liability company (LLC), you’ll pay a $40 filing fee, which is far cheaper than in some other states. LLCs are a great option for small business owners because they provide additional protections and minimize your personal liability. 

To start an LLC in Kentucky, you’ll need to take these steps:

• Choosing a business name.
• Assign a registered agent.
• Create a Kentucky Online Gateway (KOG) account.
• Submit your Kentucky articles of organization.
• Create and file an operating agreement.
• Get an employer identification number (EIN). 
• Complete a Kentucky tax registration application. 
• Apply for business permits and licenses. 
• File an LLC annual report. 

9 steps to start an LLC in Kentucky

1. Choose a business name 

Your first step to setting up your Kentucky LLC is to choose a business name. The Kentucky secretary of state requires the name be different or “distinguishable” from any name already registered in Kentucky and that it includes “limited liability company” or “LLC” as the last word(s) of the name. 

Start by brainstorming a fitting name for your LLC, then run it through Kentucky’s name availability search tool and business entity search tool. If you find that your chosen name is unavailable, you must change it to distinguish it from already-registered names.

As you do, remember, the following changes don’t differentiate a name:

• Adding “company,” “limited liability company,” “inc.” or a similar addition. 
• Adding an article such as “the,” “an” or “a.” 
• Adding conjunctions, such as “and.”
• Adding symbols, such as “+.” 
• Adding punctuation marks.
• Changing a word from uppercase to lowercase, or vice versa. 

Once you’ve chosen an available name, confirm the name isn’t trademarked and protected nationally from infringement. To do so, search for it using the United States patent and trademark office’s trademark electronic search system (TESS).

In addition, you’ll likely want to set up a website and social media presence for your new business. To avoid frustration later on, check if the logical domain name and social handles are currently available for your business name. This can help you stay consistent with branding and marketing your LLC. 

Once you’ve landed on a marketable and available name, consider reserving it to keep it from being registered before you form your LLC. You can reserve the name by filling out a reservation or renewal of reserved name form and submitting it along with a $15 filing fee. Make your check out to the “Kentucky State Treasurer” and mail it to:

Michael Adams
Office of the Secretary of State
P.O. Box 718
Frankfort, KY 40602-0718

Doing so will protect your business name from being used by another company for 120 days. 

2. Assign a registered agent in Kentucky

Assigning a registered agent is a requirement when forming a Kentucky-based LLC. The appointed registered agent (whether an individual or an entity) receives time-sensitive legal or government documents, such as notices of lawsuits against your company. 

Kentucky registered agents must meet certain requirements, including:

• Having a physical address in Kentucky. A registered agent must have a registered office in the state of Kentucky. The address cannot be a P.O. box. 
• Meeting minimum age requirements. A registered agent must be 18 years of age or older. 
• Being present during business hours. Registered agents are essentially on-call during all regular local business hours and must be present to accept documents. This means no leaving for paid time off, sick leave or business travel.
• Not being the LLC itself. The LLC entity cannot act as its own registered agent. Instead, the appointed registered agent must be an individual or a third-party corporation, LLC or nonprofit with residency or authority to do business in Kentucky. 

Serving as your LLC’s registered agent leaves you with no legal permission to leave the office during regular business hours at any point throughout the year. For this reason, many LLCs seek alternative arrangements, such as hiring a registered agent service to perform these duties. A registered agent service can provide the following benefits:

• Streamlined communication. Most registered agent services provide a portal where they upload documents received on your behalf. They alert you immediately when your documents are ready to be viewed. They may also alert you if important documents still need to be addressed or of impending document-related deadlines. 
• Confidence. By outsourcing this service to a top-rated company, you can make sure this requirement is handled legally and thoroughly as you focus on the demands of running your LLC.
• Extra business-essential products or services. You often gain access to additional business services when using a registered agent service. For example, InCorp provides EntityWatch services which help companies prevent corporate identity theft. Other services include legal and tax consultations with registered agent service plans. 

Registered agent service prices range from $0 to $300 per year, depending on the provider, features and other bundled services, such as business formation. To find the best registered agent service provider for your LLC, read our best registered agent service guide. 

3. Create a Kentucky Online Gateway (KOG) account 

You’ll need a Kentucky Online Gateway (KOG) account to register and manage your Kentucky business. To create an account, you will need the following information:

• Your full name.
• Your email address.
• A password of at least eight characters and with one lower-case letter, one upper-case letter and one number.
• Your contact information, including your phone number and street address.
• Your language preference.
• Two security question answers, such as the city in which you were born or the name of your first pet. 

Once you’ve filled in all fields on the KOG account page, click “sign up.” You will be sent an email notification. Click the enclosed activation link and follow the prompts to continue the account activation process, including verifying your email address.

4. Submit your Kentucky articles of organization

To officially start an LLC in Kentucky, you must submit articles of organization. You have two options to submit your articles of organization. You can fill out Kentucky’s articles of organization for a limited liability company form and mail it or submit it online via Kentucky’s FastTrack system, accessible through your KOG account. Submitting online through FastTrack can streamline the process. However, the filing fee is $40, regardless of the submission method. 

To fill out the form, you need the following information:

• The type of LLC you’re forming (i.e., profit, professional LLC or non-profit).
• Your LLC’s name. 
• Your LLC’s email address. 
• Your LLC’s management structure (i.e., a member-managed or manager-managed LLC).
• Whether your LLC is veteran-owned. 
• Your LLC’s principal office address.
• Your LLC’s effective (or formation) date. 
• Your title.
• Your and your organizer’s signatures.
• Your LLC’s registered agent address. 
• The registered agent’s signature. 
• Your articles of organization (to upload).
• Credit card or debit card information (for paying your filing fee). 

If you’re filing online, click “next” after providing this information to pay the filing fee and submit your form. Be sure to review your entire form for accuracy of information before submitting it. 

New LLC reporting requirement alert 

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has implemented a new reporting requirement for all non-exempt LLCs starting on January 1, 2024. 

The requirement is called the Beneficial Ownership Information (BOI) report and it is estimated to only take about 20 minutes to complete. 

Here’s what you need to know:

• LLCs formed before January 1, 2024 have until January 1, 2025 to file.
• LLCs formed between January 1, 2024 and January 1, 2025 have 90 days to file from the confirmed date of the businesses’ registration.
• New LLCs formed after January 1, 2025 will have 30 days to file from the confirmed date of formation.

For all details, FAQs and to file, visit FinCEN’s BOI website. 

5. Create and file an operating agreement

You might have a clear idea of how you want your business to operate. That’s why it’s important to get it in writing through an operating agreement. 

“One thing many overlook when setting up an LLC in Kentucky is preparing an LLC operating agreement. Even though the government does not require it, it’s crucial to outline your LLC’s ownership structure, roles and procedures,” says Brad Banias, founding partner of Banias Law and Pro Se Pro.

Setting up an operating agreement can provide several benefits and protections, including:

• Operational control. An operating agreement outlines many key operating policies, including how profits and losses are distributed, your LLC’s management structure, the powers and duties of your LLC’s members, how the LLC can be sold or dissolved and how meetings will be conducted. In doing so, it keeps your LLC from defaulting to state rules about its operations, which may contradict business needs. 
• Dispute prevention and resolution. Your operating agreement should cover each member’s voting rights, roles, duties and authority levels, as well as the overall operational policies of the company. This clarity lends to dispute prevention among members. However, if a dispute does arise, agreed-upon operational policies can help guide dispute resolution. 
• Increased protections. By recording your business’s LLC structure, an operating agreement increases your members’ liability protections. For example, your agreement should record the ownership percentages of each member, thereby limiting their liability to that percentage for personal income tax purposes. 
• Members’ rights and responsibilities. An operating agreement clarifies voting rights and establishes members’ responsibilities if you have a multi-member LLC. This clarity among members helps to set the LLC up for operational success.

You can use a free template from an LLC formation company, such as Rocket Lawyer or Northwest Registered Agent, to create an operating agreement. To ensure your operating agreement uniquely meets your business needs, consult with a business lawyer before your members sign this legally-binding document. Rocket Lawyer and Northwest Registered Agent offer legal consultation services for this purpose. 

6. Obtain an employer identification number (EIN)

An EIN identifies your business before the federal government and is used for tax administration. It is often also used to complete key financial-related business tasks, such as hiring employees, opening a business bank account, filing federal and state tax returns and applying for business loans.

Obtaining an EIN is a fast and free process. To apply, you must be a “responsible party” within your LLC. A responsible party is someone who owns or controls the entity. As the responsible party, you must provide your name and Social Security number on the application.

The application process can be completed online and takes approximately 15 minutes. Prepare to complete the EIN application in a single session, as there’s currently no option to save and return to it. After submission, you will immediately receive a confirmation document you can download and print. File the document with your other important LLC documents. 

7. Complete a Kentucky tax registration application

Enroll to pay Kentucky taxes by completing a Kentucky tax registration application. The most common business taxes include: 

• Employer withholding taxes. 
• Sales and use taxes. 
• Limited liability entity taxes. 
• Industry-specific taxes. 

In addition to enrolling in payroll taxes, this application process assigns you a Commonwealth Business Identifier (CBI). This 10-digit number identifies your LLC with all Kentucky government agencies, much like an EIN identifies your business before the federal government. 

To fill out the online tax registration application form, you need the following information: 

• Your LLC’s name. 
• Your LLC’s formation date. 
• Your LLC’s EIN. 
• The address where your business operates. 
• Your accounting period (calendar year or fiscal year). 
• Your business structure. 
• Whether your business is home-based, web-based, office- or store-based or transient. 
• Whether you’ve elected to be taxed as a partnership, corporation, s-corporation or trust. 
• Whether you are a single-member disregarded LLC. 
• As a responsible party within your LLC, your name, Social Security Number, driver’s license number, business title, address and phone number. 
• The information of a contact person (in case the state needs to contact the LLC about this application). 
• Information to determine whether you need an employer’s withholding tax account, a sales and use tax account, and limited liability entity tax account or industry-specific tax accounts. 
• An authorized representative’s signature, phone number and title. 

You can file the form online via your Kentucky online gateway account. 

8. File for business permits and licenses

While Kentucky does not have a state business license that applies to all businesses, some businesses in Kentucky may be required to secure business licenses or permits. For example, your LLC may need: 

• Occupational permits, such as marriage and family therapist, pastoral counselor, podiatry or veterinary examiner license or permits. 
• An environmental permit. 

To learn the business requirements for your LLC, contact the division of compliance assistant. If your business operates in Jefferson County, learn more about required business permits on the Louisville metro air pollution control district permits page. 

9. File an LLC annual report 

A Kentucky annual report updates your business information so the public can access always-accurate information about your business. If you do not file your annual report by June 30 of each year, your LLC will be administratively dissolved. 

To file your report, you must provide the following information: 

• Your registered agent’s name and address. 
• The names and addresses of your LLC’s officers, directors, members or managers.
• Credit or debit card information to pay the $15 annual report filing fee. 

Your form can be completed and submitted online by visiting the Kentucky secretary of state’s annual report page. Input your business name, click continue and select your business from the results page. Follow the prompts to fill out the form, submit your credit or debit card information to pay the filing fee and click the “file annual report” button.

Find the best LLC services for Kentucky: Best LLC formation services

Frequently asked questions (FAQs)

Can I set up an LLC for free in Kentucky?

No, you cannot set up an LLC in Kentucky for free. Starting an LLC in Kentucky requires you to file articles or organization, which comes with a $40 filing fee. Additionally, you may need to hire a registered agent service. Registered agent fees range from $0 to $300 per year, depending on the provider and its plan features. You may also need to reserve your business name for $10.

However, some LLC formation companies can help you keep costs at a minimum. For example, ZenBusiness offers a free year of registered agent services when you use its free LLC formation services.

Do Kentucky LLCs pay taxes?

Kentucky LLCs pay a limited liability entity tax (LLET). However, LLCs are pass-through tax entities. Therefore, taxes are generally passed on to LLC members based on ownership percentages. In turn, members must pay estimated taxes quarterly.

Do I need a registered agent in Kentucky?

Business owners starting an LLC in Kentucky must assign a registered agent. The registered agent is required to have a physical address in Kentucky, be authorized to conduct business in Kentucky and be available during all regular business hours throughout the year to receive documents on the LLC’s behalf. There are a number of registered agent service providers that can streamline this process, often for free.

Do Kentucky LLCs need to file an annual report?

Business owners with a Kentucky LLC are required to file an annual report by June 30 every year. The cost to file your LLC’s annual report is $15.

How do I dissolve an LLC in Kentucky?

If you’re ready to dissolve your LLC in Kentucky, follow the dissolution guidelines established in your LLC’s operating agreement to begin the process internally. In addition, you must file articles of dissolution with the Kentucky secretary of state and pay a $40 filing fee.