You have a big idea, truckloads of ambition, and dreams of a thriving Kentucky LLC, and you’re mentally prepared to make it happen.
But the Chinese philosopher Lao Tzu once said, “a journey of a thousand miles begins with a single step,” and for you, that first step is filing the Articles of Organization.
With such grand plans, the last thing you might want to do is file paperwork, but completing the Articles of Organization is what authenticates your LLC, making it official in Kentucky. It’s perhaps the most important step in starting your Kentucky LLC. Following this guide will help take the tedium out of paperwork and get your business started quickly.
But before you dive into the Articles of Organization, you should have a few pieces of information ready to help streamline the process.
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Choosing an LLC Name
Before anything else, you will need to decide on an LLC name. You must include a business name on your Articles of Organization, and if the Secretary of State deems that name unacceptable or unavailable, the document will be rejected, so make sure you nail down a good name right away.
Any name you choose must adhere to Kentucky’s LLC naming rules. This means that it needs to include the phrases “limited liability company” or “limited company,” or the abbreviations “LLC” or “LC,” and it must not use any form of the word “cooperative.” Plus, it cannot be the same as any other business name reserved or registered with the Secretary of State. To check if your desired name is distinguishable, perform a name search.
Once you’ve found your perfect name, include it on your Articles of Organization to automatically register it. In the event that you’re not quite ready to file an LLC, you can place a 120-day hold on your name by submitting a name reservation request.
Choosing a Kentucky Registered Agent
A registered agent is your LLC’s liaison to the commonwealth, the mediator who takes care of all your important legal, tax, and compliance documents, keeping your business in good standing. Glance over the Articles of Organization and you’ll notice that it would be incomplete without a registered agent’s information and signature, so reach out to your agent before you file.
To make the appointment official, you must also include proof of the registered agent’s consent in your LLC Articles of Organization. You can do this by including your agent’s name and signature on the Articles of Organization document, or by having them complete a “Statement of Consent of Registered Agent” form, also signed by the agent. The vast majority of entrepreneurs simply have the registered agent sign their Articles, but both options are equally valid.
Your registered agent can be either an individual Kentucky resident or a company authorized to do business in Kentucky, like a registered agent service.
Quick Note: If your first choice doesn’t work out, don’t worry. You can always change your registered agent in the future.
Preparing to File Your Kentucky Articles of Organization
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Now for the main event: the Articles of Organization. Here’s your opportunity to get your LLC officially on record and authorized to conduct business in Kentucky.
Saying that the Articles of Organization are important to your LLC formation process is an understatement. It’s absolutely essential to the process – you can’t form an LLC without it. So it’s a nice surprise that the document itself isn’t overly long or complicated. In fact, it’s only one page, and if you gather the necessary information beforehand, it shouldn’t take long at all. Here’s what you will need:
- LLC name
- Registered office address
- Initial registered agent name
- Principal office address
- Whether the LLC is managed by members or managers
- The LLC organizer’s name, title, and signature
- The registered agent’s name and signature (or a Statement of Consent of Registered Agent form)
Unfortunately, the Articles of Organization isn’t free. The good news is that the filing fee is only $40, significantly less expensive than the formation cost in other states.
Now it’s time to file. You have three options: online, by mail, or in person. Keep in mind that when filing a hard copy (by mail or in-person), you must include an additional copy of the completed application.
You can take care of the entire process through the Kentucky One Stop Business Portal. If you don’t already have an account, you’ll need to create one. Once you’re logged in, click “Register a New Business” to get started. Your filing will be processed within 24 hours.
Download a paper application here and fill it out. Then, mail it (along with your payment) to:
Office of the Secretary of State
Division of Business Filings
P.O. Box 718
Frankfort, KY 40602 – 0718
Live in Frankfort? If you prefer, you can instead hand-deliver your form to the Capitol Building, Room 154 at 700 Capital Ave. between the hours of 8:00 a.m. and 4:30 p.m.
Typically, hard copy filings are processed the day they are received, but it can take up to three business days.
What About Foreign LLCs?
The process outlined above works for domestic LLCs (those formed in Kentucky), but what if your business is expanding to Kentucky from another state? In this case, you can disregard the Articles of Organization, as it’s not the right form for you.
Any LLC expanding to Kentucky from out of state must foreign qualify by mailing or hand-delivering a Certificate of Authority and a $90 payment to the address above. You must complete this filing before you can begin conducting business in the commonwealth, and you could face some serious penalties and fines for trying to skip it.
Want Help Filing Your Articles of Organization?
Let’s be honest: you’ve got a lot on your plate. Filing paperwork can take time away from your other tasks, ones more focused on setting your budding LLC up for success.
The good news is that you don’t need to file the Articles of Organization yourself. But if an attorney is out of your price range, hiring an LLC creation service is a great option.
There’s no shortage of business incorporation services out there, but not all of them are equal. Each one offers different packages, costs, and processing times, so it’s important to find the right fit for your LLC.
While each service has optional upgrades and feature packages, on the most basic level, they will review your business information, prepare your formation documents, and submit them to the Kentucky Secretary of State. They will complete everything outlined in this guide and notify you when your Articles of Organization have been filed. You won’t have to lift a finger.
There are other benefits too. Some services will include a year of free registered agent service when you hire them. Other services offer order tracking, notifications on future documents (like annual reports), assistance drafting your operating agreement, or coverage of certain LLC formation costs.
Important Post-Formation Compliance Issues
Once you’ve successfully filed your Articles of Organization, your LLC is an official business entity in the state of Kentucky. However, this doesn’t mean that your responsibilities have come to an end. There are several other steps you’ll need to take if you want to operate a compliant LLC for years to come.
Acquire a Federal Tax ID Number (EIN)
While an EIN isn’t a requirement for Kentucky LLCs, we strongly recommend that every entrepreneur obtains one. An EIN enables your LLC to hire employees, open business bank accounts, file taxes, and take care of several other important aspects of LLC maintenance. Even if you operate a single-member LLC with no employees, you should still have an EIN for your business.
Set Up a Financial Infrastructure
One other crucial step is to solidify the financial aspects of your LLC, first by opening a business bank account. You must have separate bank accounts for your personal use and for business purposes, as this will help you keep your personal and business assets separate, a vitally important consideration for any entrepreneur. If you commingle these assets, you leave yourself wide open for lawsuits, as it would be easy for someone to claim that your business is simply an extension of your own personality and not a separate entity from you as a person.
The other portion of this step is to set up an accounting system. This can either mean that you hire an accountant to take care of your LLC’s bookkeeping, or you could acquire high-quality accounting software like QuickBooks. Either way, you need a reliable means of keeping detailed records for each financial transaction your LLC executes. This is another vital part of keeping your personal and business assets separated, and it will also be enormously helpful come tax time.
Acquire Licenses and Permits
The next step involves obtaining any industry-specific licenses and permits your LLC may need to operate in compliance with state laws. Depending on the nature of your LLC’s business, you may require several permits or you may be able to operate your LLC without any state-level licenses.
Thankfully, Kentucky makes it very easy to figure out your business’ licensing needs. All you need to do is visit the state’s Occupational Licenses and Permits page and you’ll find the license and permit applications you require. Make sure to check with your county and locality as well, as there may also be licensing requirements for your business on these levels.
Obtain Business Insurance
This step isn’t a requirement, but it is a strong recommendation. The exact insurance policies your business needs will vary based on the type of products and services you offer, but most LLCs should at least have a general liability insurance policy to protect against common perils like slip-and-fall accidents. In some industries, you might need several different insurance policies to cover all of your financial bases, so do your research ahead of time to determine which types of insurance you should purchase.
File Your Annual Reports
Each year, every LLC in Kentucky must file an annual report. This report includes some basic information about your business and keeps the state updated regarding any important changes to your LLC’s structure. The information you’ll need to file this report typically includes your LLC’s principal office address, registered agent name and address, and the names and addresses of the LLC’s members or managers.
Frequently Asked Questions
About Filing the Kentucky LLC Articles of Organization
How long does it take Kentucky to form an LLC?
Online filings are typically processed within 24 hours. In-person filings typically take 1-3 business days, and mailed documents can take a week or so.
Should I file my own Articles of Organization, hire an attorney, or use an online service?
This question largely comes down to personal preferences, but we do have some general insights. The DIY route can be quite a bit of work, as you’ll need to complete each step of the formation process on your own with no assistance. As for hiring an attorney, this can be prohibitively expensive for new businesses, as a lawyer can charge hundreds or even thousands of dollars to form your LLC.
You can think of business services companies as a middle ground between these options. While most of these companies charge a fee to form your LLC, that fee will be significantly less expensive than an attorney’s fee. At the same time, you still aren’t going it alone. Instead, you have an experienced professional guiding you through the entire process.
What does Kentucky require for LLC formations other than the Articles of Organization?
Unlike some states, Kentucky doesn’t require any related filings other than your formation articles, unless your registered agent doesn’t sign your Articles of Organization, in which case you’d need to include a Statement of Consent of Registered Agent form.
However, we still strongly recommend obtaining a federal tax ID number (EIN). An EIN allows your LLC to file taxes, hire employees, open business bank accounts, and more. Every LLC should have one, whether your state requires it or not.
How many small businesses are there in Kentucky?
Today, Kentucky has more than 355,000 small businesses. Clearly, entrepreneurs in many different fields find Kentucky to be a great place to own and operate a business entity.
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