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The Kentucky LLC operating agreement is a legal document that is recommended for single and multi-member limited liability companies. In addition to separating individual and company assets, it allows LLC directors to create the framework for how the business will run, including operations, responsibilities, and rights of members.

From KRS 275.015:

(21) “Operating agreement” means any agreement, written or oral, among all of the members, as to the conduct of the business and affairs of a limited liability company. If a limited liability company has only one (1) member, an operating agreement shall be deemed to include:
(a) A writing executed by the member that relates to the affairs of the limited liability company and the conduct of its business regardless of whether the writing constitutes an agreement; or
(b) If the limited liability company is managed by a manager, any other agreement between the member and the limited liability company as it relates to the limited liability company and the conduct of its business, regardless of whether the agreement is in writing;

Kentucky Operating Agreement Law

Per KRS 275.177:

If a written operating agreement contains a provision to the effect that any amendment to the operating agreement of the limited liability company shall be in writing and adopted in accordance with the provisions of the operating agreement, then the provision shall be enforceable in accordance with its terms, and any agreement as to the conduct of the business and affairs of the limited liability company which is not in writing and adopted in accordance with the provisions of the operating agreement shall not be considered part of the operating agreement and shall be void and unenforceable.

Per KRS 275.180
A written operating agreement may:
(1) Eliminate or limit the personal liability of a member or manager for monetary
damages for breach of any duty provided for in KRS 275.170; and
(2) Provide for indemnification of a member or manager for judgments, settlements,
penalties, fines, or expenses incurred in a proceeding to which a person is a party
because the person is or was a member or manager.

Forming an LLC in Kentucky

  1. Conduct a name search
  2. Choose a registered agent
  3. File formation articles
  4. Draft an operating agreement

To file formation articles, Kentucky LLCs need a legally registered business name.

This name must include any of the following as a designator that describes the business as a limited liability company:

  • LLC
  • L.L.C.
  • Limited Liability Company
  • Ltd.

The name must be distinguishable from other business names in the state. This includes LLCs and other business types as well. It should not include other designations within the name, such as “inc” to avoid confusion about the formation type.

Government titles, acronyms, and abbreviations as Treasury, CIA, FBI, etc.. are banned as well.

Professionals may need to complete additional verification to create a professional LLC using their title as a practitioner. Lawyers and doctors would be an example of this.

To conduct the name search, use the Kentucky Secretary of State Business Entity Search website.

Step 2: Choose Your Registered Agent

All Kentucky LLCs must appoint a registered agent to represent the company as part of formation. The chosen agent will be responsible for receiving mail on behalf of the LLC, which may include service of process and other important documentation that must reach the LLC formation, or the agent accepts liability. Therefore, the registered agent chosen must be reliable.

The agent may be an individual, including someone part of the LLC, who meets the following qualifications:

  • Be 18 years or older
  • Be a resident of the state
  • Have a physical (not a P.O. Box) address in Kentucky, as well as a mailing address within the state

The agent may also be a business, often known as a registered agent service who must be authorized to do business in Kentucky to be appointed. When using a registered agent service, the agent must be authorized to do business in Kentucky.

Step 3: File Your Formation Articles

Kentucky Domestic LLC formations (in-state) must file Articles of Organization online, by mail, or in-person to register their company with the state.

Online Filing (Domestic):

  • $40 filing fee
  • Turnaround time: Immediate
  • Create an account and submit online

Mailed Filing (Domestic):

  • $40 filing fee
  • Turnaround time: 2-3 business days upon receipt
  • Fill out the form (for-profit or non-profit) online or after printing and mail to:

Michael Adams
Office of the Secretary of State
PO Box 718
Frankfort, KY 40602-0718

In-Person Filing (Domestic):

  • $40 filing fee
  • Turnaround time: 2-3 business days
  • Fill out the form (for-profit or non-profit) online or after printing and deliver to:

Room 154, Capitol Building
700 Capital Avenue
Frankfort, KY 40601

Kentucky Foreign LLCs expanding their business to Kentucky must complete a Certificate of Authority, and file a Certificate of Existence from the original formation of the business that is dated within the past 90 days from filing.

Online filing is unavailable for Foreign LLCs

Mailed Filing (Foreign):

  • $90 filing fee
  • Turnaround time: 2-3 business days upon receipt
  • Fill out the form online or after printing and mail to:

Michael Adams
Office of the Secretary of State
PO Box 718
Frankfort, KY 40602-0718

In-Person Filing (Foreign):

  • $90 filing fee
  • Turnaround time: 2-3 business days
  • Fill out the form online or after printing and deliver to:

Room 154, Capitol Building
700 Capital Avenue
Frankfort, KY 40601

Step 4: Draft a Kentucky Operating Agreement

While not required, it is highly recommended that Kentucky LLCs create an operating agreement, even if they are single-member formations. This legal documentation is used to document capital contributions, decide profit and loss distribution, and more.

An operating agreement can provide individuals with liability protection, separating themselves from the LLC’s finances in the case of litigation. Or, it can protect individuals within the LLC from malicious action like termination.

The agreement does not need to be filed with the state, but it should be signed and a copy should be kept with the formation documents as well as each organizing member.