LLC in Kentucky: Everything You Need to Know
An LLC in Kentucky is a Limited Liability Company business entity formed and certified to conduct business in the state of Kentucky.3 min read
2. How to Form an LLC in Kentucky
An LLC in Kentucky is a Limited Liability Company business entity formed and certified to conduct business in the state of Kentucky.
What Is an LLC?
LLCs (Limited Liability Companies) are business types that offer the liability protection of a corporation and the pass-through taxation of a sole proprietorship. An LLC offers a lot of freedom when it comes to the structure of the business and how it will be managed. LLCs also enjoy less paperwork than corporations.
How to Form an LLC in Kentucky
Beginning any business can be a scary task, but Kentucky makes establishing an LLC inexpensive and easy to do. First, you'll need to choose a name for your business. Do this carefully and with plenty of thought, as this is the name that future clients or customers will come to know your company by.
The naming requirements are similar throughout the United States. The state of Kentucky has the following rules:
- The name has to include "LLC" or "Limited Liability Company" (or certain shortened forms like "Limited Company" or "Ltd. Co.").
- The name cannot use words like "university" or "doctor" or others that require particular licensure or certifications.
- The name also cannot use words like "secret service," which might cause customers to confuse the business with a federal agency or state agency.
- The name has to be made up of English lettering and Roman numerals.
- The name must be completely unique so as not to be mistaken for another business in the state.
In order to be sure that the name you've chosen for your company is not currently reserved or in use, perform a business entity search on the Kentucky Secretary of State website or call (502) 564-3490 and ask. Online you can enter any parts of a name, so be sure to check for any similar names and not just search the name you want exactly.
If you find that the name you want to use is not currently in business, you can reserve it for 120 days when you fill out a name reservation request form. This can be done online or through the mail with a fee of $15.
This form will include the following information:
- Desired business name to reserve
- Name and address of person filling out the application
- Management structure of the LLC
- Effective date, if it is later than the date of filing the form
- Signature and title of the person filling out the application
When starting an LLC, you'll also want to check that the domain name for the business is also available for use. If it is, it's a good idea to reserve that, as well, so it's ready when you want to build your company website.
You'll also need to choose a registered agent for your LLC. This can be a person or another business entity (not the LLC itself) with an address in the state of Kentucky. This individual or business will receive any legal documents for your LLC and will need to let the LLC members know any time documents are received.
LLCs are either member-managed or manager-managed. When the members manage the company, the duties of management are simply divided among the members. Usually, single-member LLCs are member-managed. If an LLC elects or hires an individual to manage the business, they will be a manager-managed LLC.
- Name and address of the LLC
- Name and address of the registered agent
- Whether the LLC is member-managed or manager-managed
- Date of formation for the LLC (must not be later than 90 days after this document is filed)
- Names, addresses, and signatures of all founding members
Kentucky charges a $40 fee to file articles of organization.
Another important part of the process of forming an LLC in the state of Kentucky is drafting the business's operating agreement. This document is not required by the state but will help to prevent future misunderstandings and disputes among the members. It should spell out the responsibilities of each of the members as well as their percentages of interest in the company and how profit distribution will be handled. You also might want to outline member voting rights and how members can be added to the company.
Finally, you'll need to obtain an EIN (Employer Identification Number) from the IRS.
If you need help with an LLC in Kentucky, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.