How to Start a C-Corp in Kentucky (Quick Answer)
To start a C-corp in Kentucky, file Articles of Incorporation with the Kentucky Secretary of State, name a registered agent, and pay the $40 filing fee plus a small organization tax on your authorized shares. Once the state accepts it, your corporation legally exists.
After that, you adopt bylaws, appoint directors and officers, issue stock, and get an EIN from the IRS. Kentucky adds a Limited Liability Entity Tax on top of the 5% corporate income tax, which most guides skip.
| Filing document | Articles of Incorporation |
| Where to file | Kentucky Secretary of State |
| Filing fee | $40, plus an organization tax based on your authorized shares (a small minimum for most startups) |
| Registered agent | Required, with a physical Kentucky address |
| EIN | Required, free from the IRS (Form SS-4 by phone, fax, or mail if you have no SSN or ITIN) |
| Annual report | $15, due between January 1 and June 30 each year |
| Limited Liability Entity Tax (LLET) | $175 minimum, based on Kentucky gross receipts or gross profits; most small corporations owe the minimum |
| Corporate income tax | Flat 5% on Kentucky net income |
| Foreign owner (25% or more) | File Form 5472 with Form 1120 every year, or face a $25,000 minimum penalty |
First-year cost: about $40 to file plus the small organization tax, and a registered-agent service if you use one, commonly $50 to $150 a year. Your first annual report and LLET come in the year after formation.
Kentucky's extra cost is the Limited Liability Entity Tax, or LLET. It applies on top of the 5% corporate income tax, with a $175 minimum, so most small corporations owe at least $175 in LLET each year.
The annual report itself is cheap, $15, due by June 30. Between the LLET and the 5% income tax, Kentucky's real cost is on the tax side, not the filing.
TL;DR
- Kentucky adds a Limited Liability Entity Tax: a $175 minimum on top of the 5% corporate income tax; the annual report is a cheap $15 due June 30.
- Step 1, name: pick a unique name with a corporate designator (Inc., Incorporated, Corporation, or Corp.) and check it with the Secretary of State.
- Step 2, registered agent: name one with a physical Kentucky address.
- Step 3, Articles of Incorporation: file with the Secretary of State for $40 plus the organization tax.
- Step 4, bylaws: adopt internal bylaws and keep them with your records.
- Step 5, directors and officers: appoint the board and officers and hold an organizational meeting.
- Step 6, issue stock: authorize and issue shares, keep a stock ledger, and file the 83(b) election within 30 days if your shares vest.
- Step 7, EIN: get a free EIN from the IRS, by Form SS-4 if you have no SSN or ITIN.
- Foreign owner (25% or more): file Form 5472 with Form 1120 every year, or risk a $25,000 penalty.
- Ongoing: a $15 annual report by June 30, the LLET ($175 minimum), and the flat 5% corporate income tax.
Why Form a C-Corp in Kentucky?
Kentucky offers low filing costs, a central-US location, and strong manufacturing and logistics sectors.
- A low $40 filing fee and a cheap $15 annual report.
- Strong manufacturing and logistics, with major shipping hubs.
- Online filing through the Secretary of State.
Weigh the LLET first. If you plan to raise venture capital, investors will most likely want a Delaware C-corp. Kentucky's Limited Liability Entity Tax applies on top of the income tax, so factor in at least the $175 minimum.
Step 1: Choose and Reserve Your Corporate Name
- Include a corporate designator such as "Inc.", "Incorporated", "Corporation", or "Corp."
- Search the Secretary of State's business database to confirm the name is available and different from existing entities.
- Kentucky lets you reserve a name for 120 days for a fee if you are not ready to file.
Step 2: Appoint a Kentucky Registered Agent
Every Kentucky corporation must name a registered agent with a physical Kentucky address, available during business hours to receive legal and state documents.
- The agent can be a person or a company, but needs a real Kentucky address, not a PO box.
- The address is public record, so many owners use a commercial service.
- A commercial agent commonly costs $50 to $150 a year.
Step 3: File Your Articles of Incorporation
The Articles of Incorporation is the filing that legally creates your corporation. You file it with the Kentucky Secretary of State.
- It lists the corporate name, registered agent, incorporator, and the number of shares the corporation is authorized to issue.
- The fee is $40, plus an organization tax based on your authorized shares, which is a small minimum for a typical startup.
- Once the state accepts it, your corporation exists and its compliance calendar begins.
Step 4: Adopt Corporate Bylaws
Bylaws are the internal rulebook for how the corporation is run. They are not filed with the state, but a corporation is expected to have them, and banks and investors often ask to see them.
- They set out how directors and officers are elected, how meetings and votes work, and how shares are handled.
- They stay with your records, not with the Secretary of State.
- Skipping them can weaken the separation between you and the corporation that liability protection depends on.
Step 5: Appoint Directors and Hold the Organizational Meeting
A corporation is run by a board of directors, who appoint the officers that handle day-to-day work. Right after formation, the incorporator or initial directors hold an organizational meeting, or sign a written consent in place of one.
- Appoint the initial board and elect officers (usually at least a president, secretary, and treasurer; one person can hold several roles).
- Adopt the bylaws and authorize the issuance of stock.
- Keep signed minutes or the written consent with your records.
Step 6: Authorize and Issue Stock
Issuing stock is how founders get their ownership, and it is easy to rush. The board authorizes shares, then the corporation issues them to the founders and any early shareholders.
- Issue shares to each founder and record what they paid (cash, property, or services).
- Keep a stock ledger, a running record of who owns how many shares.
- Note your authorized shares. Kentucky's organization tax at formation is based on the number you authorize.
The 83(b) election, and its 30-day deadline: if your founder shares vest over time, you generally have 30 days from the grant date to file an 83(b) election with the IRS.
It lets you be taxed on the small value at grant instead of the higher value as the stock vests. The 30-day window cannot be extended, and missing it can be expensive.
Step 7: Get an EIN, Even Without an SSN
An EIN is your corporation's federal tax ID, needed to file taxes, run payroll, and open a bank account. It is free from the IRS.
- With an SSN or ITIN, apply online and get the EIN in minutes.
- Without an SSN or ITIN, apply on Form SS-4 by phone, fax, or mail.
- The EIN is always free; you never pay the IRS for one.
Open a US Business Bank Account
Once you have the EIN, open a dedicated business bank account before money moves through the corporation.
- Keeping corporate and personal funds separate helps protect the liability shield; commingling them is a common reason courts pierce it.
- Banks usually ask for the filed Articles of Incorporation, the EIN letter, and often the bylaws or a board resolution.
- A separate account also makes bookkeeping and the corporate tax return simpler.
If Your Kentucky C-Corp Is Foreign-Owned
A Kentucky C-corp that is 25% or more owned by a non-US person has an extra federal filing that many international founders miss.
- The corporation files Form 5472 with its annual Form 1120 to report transactions with the foreign owner, such as money put in or paid out for services.
- It is required every year there are reportable transactions, even with little or no profit.
- The penalty is steep: a missed or late Form 5472 starts at $25,000 per form, per year.
Handle Kentucky's Ongoing Compliance
Three things run each year: the cheap annual report, the LLET, and the corporate income tax.
The $15 Annual Report (Due June 30)
- Every Kentucky corporation files an annual report with the Secretary of State for $15.
- It is due between January 1 and June 30 each year.
- Missing it can put the corporation out of good standing and eventually lead to administrative dissolution.
The LLET and Corporate Income Tax
- The Limited Liability Entity Tax has a $175 minimum and is based on Kentucky gross receipts or gross profits; most small corporations owe the minimum.
- The corporate income tax is a flat 5% on Kentucky net income, filed with the Department of Revenue alongside the LLET.
- Federally, the corporation files Form 1120 and pays 21% corporate tax, due the 15th day of the 4th month after year-end.
How Much Does It Cost to Start a C-Corp in Kentucky?
| What you pay | Amount | When |
|---|---|---|
| Articles of Incorporation filing | $40, plus a small organization tax on shares | One time, at formation |
| Registered-agent service (optional) | ~$50 to $150 a year | Yearly, if you use one |
| Annual report | $15 | Yearly, by June 30 |
| Limited Liability Entity Tax (LLET) | $175 minimum | Yearly |
| Corporate income tax | Flat 5% of Kentucky net income | Yearly |
| Federal corporate tax | 21% of profits | Yearly, with Form 1120 |
How Long Does It Take to Start a C-Corp in Kentucky?
- Online filings with the Secretary of State are usually processed within a few business days.
- The EIN follows: minutes online with an SSN or ITIN, or same day to several weeks by Form SS-4 without one.
- Bylaws, the organizational meeting, and issuing stock happen right after the state approves the filing.
Common Mistakes to Avoid
- Overlooking the LLET. It is a $175 minimum on top of the income tax, and most small corporations owe it.
- Missing the June 30 annual report, despite its low $15 fee.
- Missing the 30-day 83(b) deadline on vesting founder stock.
- Overlooking Form 5472 if the corporation is 25% or more foreign-owned.
- Using a PO box for the registered agent, which Kentucky does not accept.
How FinStackk Helps
FinStackk is an accounting and tax compliance platform for U.S. businesses, taking you from incorporation through ongoing accounting, tax, and compliance in one place.
We handle Kentucky C-corp formation, from the Articles of Incorporation to the EIN, through Fin-Start, including the Kentucky registered agent.
Once the corporation exists, Fin-Tax keeps the federal Form 1120 deadline, the LLET, and the 5% Kentucky corporate income tax on a proactive calendar. Complyy tracks the $15 annual report due June 30 and your registered-agent renewal. Book a free demo to see them in action.
FAQ
What is Kentucky's Limited Liability Entity Tax?
The Limited Liability Entity Tax (LLET) applies to corporations and LLCs in Kentucky, with a $175 minimum. It is based on Kentucky gross receipts or gross profits, but most small corporations owe just the $175 minimum. It is separate from and in addition to the 5% corporate income tax, so budget for both.
How much does it cost to start a C-corp in Kentucky?
It costs $40 to file the Articles of Incorporation, plus a small organization tax based on your authorized shares. Add a registered-agent service if you use one. Going forward, the annual report is a cheap $15 due June 30, but budget for the LLET ($175 minimum) and the 5% corporate income tax.
When is the Kentucky annual report due?
The annual report is due between January 1 and June 30 each year, filed with the Secretary of State for $15. Missing it can put the corporation out of good standing and eventually lead to administrative dissolution, so keep the June 30 date on your calendar.
Is it better to form a C-corp or an LLC in Kentucky?
Both Kentucky corporations and LLCs owe the LLET and file the cheap $15 annual report. An LLC is simpler and taxed once, while a C-corp pays the 5% corporate income tax and suits founders who plan to raise venture capital. A C-corp is taxed twice, once at the corporate level and again on dividends.
Should I form my C-corp in Kentucky or Delaware?
If you plan to raise venture capital, Delaware is what investors expect. If you will operate in Kentucky and not raise venture money, forming in Kentucky avoids registering and paying in two states, since a Delaware corporation doing business in Kentucky still has to register and pay the LLET here. Choose based on where you operate and whether you will raise money.
Can a non-US resident start a Kentucky C-corp?
Yes. Kentucky sets no citizenship or residency requirement to own a corporation. You will need a Kentucky registered agent and an EIN, which you apply for on Form SS-4 by phone, fax, or mail without an SSN.
If a non-US person owns 25% or more, the corporation also files Form 5472 with its Form 1120 every year, with a $25,000 minimum penalty for missing it.