Free Guide to Start an LLC in Kansas
Starting a business in Kansas can be an exciting time. Before selling your product or service though, the nuts and bolts of licenses, registrations, and taxes must be completed.
The guide below will show you the DIY process of forming an LLC in Kansas. However, you can also use an online LLC service handle the paperwork for you. We reviewed and ranked the 7 best available.
The Top 2 Worth Considering:
- Northwest Registered Agent is a great option if you are looking for premium customer support.
- IncFile is ideal if you are looking for the best pricing with excellent features.
Step 1: Name Your LLC
Selecting a name for your Kansas LLC is a first step, yet a very important one. A name that is unique and easy to remember is helpful in finding potential clients or retaining customers.
The name should indicate the product or service. It should also follow guidelines set forth by the state of Kansas.
The name of an LLC will likely appear on business cards and stationary, marketing materials, a website, legal contracts, business bank accounts, invoices and/or a building directory.
Kansas law requires that the business name includes the words/abbreviations, “Limited Liability Company,” “Limited Company,” “LC,” “L.C.,” “LLC,” or “L.L.C.” It must be different or “distinguishable” from other names already registered. Distinguishable features include the following:
- A key word is different.
- If the key words are numbers, they are communicated differently: as numerals, Roman numerals, or written words.
- Key words are differentiated by singular or plural.
Features that are not distinguishable include the following:
- The addition or subtraction of an article, or the words “to” and “with”
- The addition or subtraction of a symbol, punctuation mark, or special character
- The change of a word or abbreviation that designates a type of business entity
Let’s imagine that someone is considering opening a flower shop in Topeka, Kansas. The name she is considering, Flowers by Fanny, is already in use. Instead, she decides to legally name her business Fanny’s Florals, LLC.
Determine the Name is Available
Following the selection of a name but before filing the Articles of Organization, check to ensure that your name is unique on the Kansas Business Center Name Availability database. Searching in other places, such as online, is also a good idea.
After you have determined that your chosen name is “distinguishable,” the name can be registered in order that you have exclusive rights for 120 days.
Optional: Name Reservation
Sometimes a situation may arise where an individual wants a particular name but needs time to organize his/her company before filing paperwork to create an LLC. In this case, a name can be reserved for 120 days in the state of Kansas. Renewals are not available.
If filing a hard copy of the Reservation of Business Entity Name, the cost is $35 and can be paid by check or money order, payable to the Secretary of State. Processing time is three to five business days. Mail or deliver in person the payment and application to the following address:
Kansas Office of the Secretary of State
Memorial Hall, 1st Floor
120 S.W. 10th Avenue
Topeka, KS 66612-1594
If filing online, you will need to first set up an account with KanAccess. The filing fee is $30, and the reservation will be processed immediately.
Step 2: Choose a Resident Agent
Every LLC in Kansas is required to have a resident agent. This agent can be an individual or a company.
The role of the resident agent is that of a contact person between the LLC and the state. As stated on the Kansas Office of the Secretary of State website, the resident agent “is a person or entity that is authorized to accept service of process (lawsuits) on behalf of the business entity. This does not necessarily mean that the agent himself/herself is being sued, but that he/she has the authority and responsibility to accept service of process on behalf of the business.”
Simply put, the process agent receives communications or documents from the state involving such things as taxes or lawsuits and communicates them to the LLC.
Some may wonder why a Kansas resident agent is necessary. The importance of the agent is to ensure that someone is always available to receive important documents even if the business owner leaves the office, goes on vacation, or is otherwise away. Also, having a resident agent is especially important if a physical office does not exist in Kansas.
The owner of the LLC can designate a resident agent on the Articles of Organization application.
Individual as Resident Agent
Most importantly, the individual must be a resident of the state of Kansas. Using a third party ensures that nothing falls through the cracks. The third party can be an accountant, an attorney, or even a friend. The agent must have a physical and mailing address in Kansas.
Resident Agent Service
If using a service, the resident agent must be a business or professional. We recommend either using an LLC formation service (like Incfile or Northwest Registered Agent) which gives you a free resident agent or ordering a resident agent service by yourself if you choose to DIY your Kansas LLC formation.
Step 3: File the Formation Documents with State
Let’s assume that fictional Fanny has selected both the name for her LLC and the registered agent. She is ready to complete the paperwork (called the Articles of Organization) that actually creates Fanny’s Florals, LLC in Kansas.
This step can be completed either online or by mailing a hard copy through USPS. The filing fee varies according to how you file. The most cost effective method is filing online. When you are ready, it is important to note a few details about each method to ensure that your application is fully completed in the time frame in which you need it.
If filing online, you will need to first set up an account with KanAccess. The cost is $160.
Hard Copy Filing
If filing a hard copy, the fee is $165 and can be paid by check (payable to Secretary of State), money order, or credit card. The application and payment can be sent or delivered in person to the following address:
Kansas Office of the Secretary of State
Memorial Hall, 1st Floor
120 S.W. 10th Avenue
Topeka, KS 66612-15941
If faxing, the filing fee is $185. The application can be faxed to Business Services, (785) 296-4570.
If filing the application online, it will be processed immediately. If using another method, processing time is three to five business days.
Step 4: Create an Operating Agreement
An operating agreement in the state of Kansas is recommended though not required. The agreement is a contract that defines the operations of the LLC, includes terms and conditions, states the responsibilities of its members, and ensures legal protections of its members.
All owners of the LLC must be in agreement of the terms in the agreement and sign before a notary public.
The operating agreement is useful for both multi-member and single-owner LLCs. In both cases, the agreement provides protections.
For example, in the case of the multi-owner LLC, the terms can stipulate what should happen if a death or divorce occurs among one of its members. In the case of the single-owner LLC, the agreement could be used in court as evidence that the LLC is separate from the individual owner.
The operating agreement can be created in two ways. Some individuals may choose to write the agreement on their own, using an online template. In this case, forms are available that are specific to state. Be sure to use the correct multi-member or single-member form.
The alternative is hiring an attorney to create the document. The benefits of using an attorney are ensuring the document doesn’t exclude any important information, adheres to state law, and invalidates default provisions that may not be what you wish.
Step 5: Get an EIN
An EIN is an Employer Identification Number. Anyone who runs their business as a corporation or partnership must file for this 9-digit number in order to identify the tax accounts of a business. The number can be applied for in one of the following three ways:
Applying online is the quickest method. The process can be completed between 7 a.m. and 10 p.m. EST, Monday through Friday. When the form is completed, the information will be immediately validated and a number issued while you are still online. In order to apply online, a valid individual taxpayer number, such as a Social Security number, is required.
Form SS-4 can be downloaded, completed and faxed to 855-641-6935, twenty-four hours, seven days per week. The EIN will be provided within four business days.
If either of the above methods are unavailable, Form SS-4 can be mailed, though processing will take approximately four weeks. The form can be mailed to the following address:
Internal Revenue Service Operation
Attn: EIN Operation
Cincinnati, OH 45999
Think you’re ready to open up shop now? Guess again!
Step 6: Taxes, Licensing & Income Reporting
Businesses like Fanny’s Florals, LLC may be official after completing the above steps, but it is important not to overlook a few critical details.
On the federal level, most LLCs do not pay taxes directly to the government. Instead, they report income and losses on the owner’s personal 1040 tax returns. Schedule C is often used for reporting. Unless the LLC chooses to be taxed as a corporation, a single-member LLC is taxed as a Sole Proprietorship and a multi-member LLC is taxed as a Partnership.
Similarly, most LLCs will pay state tax on pass-through income via their personal income tax returns. The exception is if an election is made to tax the LLC as a corporation.
Unlike many other states, the state of Kansas does not place a tax or fee on LLCs for the privilege of doing business in the state.
Some LLCs will need to complete a Kansas Business Tax Application either online or by hard copy. This includes if your LLC sells merchandise, and therefore, needs to pay a sales or use tax. In addition, if your LLC is an employer, you will need to pay withholding tax.
Unemployment taxes are also required of LLCs that are employers. To pay this tax, the LLC must first register with the Department of Labor.
Finally, an LLC may need to file and pay a local tax to a city, municipality, or county.
In some cases, a professional license is needed before a business can begin operations. Professional licenses are provided by a number of different agencies, and requirements and fees vary according to the license.
The Kansas Business Center of the Secretary of State website provides a thorough list of professions and occupations along with required licensure.
Licenses may also be required by the city, municipality or county where your LLC is located. It is a good idea to check the website of your local government(s).
After an LLC is formed, an annual report must be filed with the state of Kansas. The fee is $50 if filing online and $55 if filing a hard copy. See the information above for the appropriate address or fax number.
The annual report should be filed at the same time your annual Kansas tax return is filed. Processing time is immediate if filed online and three to five business days if another method is used. If the report is not filed within 90 days of the due date, the LLC will be dissolved by the state.
When all of the mechanics of setting up an LLC in Kansas have been completed, someone like Fanny can get down to the business of setting up a website, creating a logo…or purchasing flowers!
Need Help Creating Your LLC?
We recommend LLC formation services because it allows you to knock off an important thing off your checklist so you can focus all your energy on actually starting a business.
Can you do it yourself? Absolutely.
However, a service that forms an LLC for you will help with ongoing maintenance and keep you notified of any requirements you should adhere to.
As we mentioned earlier, IncFile and Northwest Registered Agent are the top LLC services available. If you’re not familiar with them, as a point-of-reference many of our readers like to compare them to the most well known LLC service, LegalZoom.