Do-it-yourself Kentucky S Corporation Kit

S corporations can save Kentucky businesses thousands of dollars in payroll and income taxes, and they're actually quite easy to set up. You don't need to pay an accountant or online incorporation service to do the work for you. All you need to do is download one of the affordable kits described below and follow the simple step-by-step instructions provided to complete three forms:

Form 1: Articles of Incorporation/Articles of Organization

Before you fill out the first form you need to decide if you will use a limited liability company or a traditional corporation as the base for your Kentucky S corporation. LLCs are less work to manage, and for that reason I (and many other professionals) recommend LLCs over corporations. To form an LLC, fill out an Articles of Organization form and submit it, along with the $40 filing fee, to the Secretary of State's Division of Business Filings in Frankfort. To form a corporation, fill out an Articles of Incorporation form and the $50 minimum fee to the Secretary of State office as well.

Form 2: SS-4 for EIN Application

The second form you need to fill out is the SS-4 form, which is an application for an Employer Identification Number. Employer Identification Numbers function a bit like Social Security Numbers for businesses. The SS-4 form is available for download from the IRS website. You should receive your EIN a few weeks after you submit your application.

Form 3: 2553 for S Corporation Election

The final form you will need to fill out is a 2553 form to make the S corporation election. The 2553 form tells the IRS you want your business to be treated using the laws found in Subchapter S of the Internal Revenue Code (hence the name "S corporation"). Fill out and submit this form to the Internal Revenue Service Center in Cincinnati, Ohio. The IRS will process your submission and check to make sure you followed correct procedure and that you are eligible to make the election.

If you would like a bit more instruction or coaching through this process, my downloadable do-it-yourself kit in e-book form can help you. I created two versions of the e-book: one for Kentucky businesses using LLCs and another for Kentucky businesses using traditional corporations.

Kentucky Kit Version 1: Using a Limited Liability Company

If you choose to use an LLC as the base for your S corporation, this kit provides you with clear, easy-to-follow instructions. It also explains the benefits and drawbacks of forming an LLC in Kentucky and explains how to use the Subchapter S account rules for your S corporation. As a bonus, I include two sets of sample LLC operating agreements. One set is for LLCs with one owner, and the other set is for LLCs with two or more owners.

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Kentucky Kit Version 2: Using a Traditional Corporation

I also provide a do-it-yourself kit for business owners who choose to use a corporation for their S corporation rather than an LLC. The corporation kit comes with detailed instructions for the entire process. It also explains how to balance the positives and negatives of incorporating in Kentucky. Additionally, I include a set of sample corporate bylaws at the end of the e-book, to further help you form your new corporation.

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If you want additional information about how to maximize the tax savings related to running a business or investment venture, you may also be interested in one of our downloadable e-books (see descriptions below). Each book covers a category of tax planning topics that easily save a business owner significant amounts of income or self-employment taxes (potentially thousands of dollars a year) and is instantly downloadable.

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