Kentucky vs New Jersey LLC: fees, taxes, and which to pick
Data last updated: Apr 21, 2026Kentucky charges $40 to form an LLC; New Jersey charges $125. Day-one sticker price is only part of the story, since most of the real cost comes from the annual obligations that stack up each year you keep the LLC open.
Over a rolling three-year window, New Jersey runs about $260 less in total state fees than Kentucky. Whether that gap matters depends on whether you actually operate in one of these states or are weighing a non-resident filing.
Kentucky imposes an entity-level annual tax on every LLC ($175 minimum). New Jersey does not. For pass-through LLCs that would otherwise owe nothing at the state level, that minimum is the deciding line.
On speed, Kentucky typically clears standard online filings faster than New Jersey. Both states offer expedited tiers at an additional cost for filers on tight timelines.
For most small operators the choice is not really between these two states at all. It is between forming where the business actually operates and trying to route through a non-resident filing. The data below shows what each option actually costs.
Key differences at a glance
- Kentucky costs $85 less to form ($40 vs $125).
- New Jersey is $115 per year cheaper to maintain ($175 vs $290).
- Kentucky imposes an entity-level franchise or LLC tax that applies to pass-through LLCs. New Jersey does not.
Where each state fits
For most filers, forming in the state you actually operate from is the right call. The side-by-side below shows where the two states meaningfully diverge.
What each state offers that the other does not
Only New Jersey
- Paid expedited tier
- No entity-level franchise or LLC tax
Both states
- Online filing
- No publication requirement
- Operating agreement not statutorily required
Three-year cost, side by side
Rough estimate of the state-facing cost to form and keep an LLC through three years. Both totals include a $100 per year registered-agent estimate.
Running total includes the one-time filing fee and annual ongoing costs (report fee or franchise tax plus a $100/year registered agent estimate).
What it costs under your specific situation
The table below runs the same LLC through four common scenarios. "Non-resident" rows assume a typical home-state foreign LLC registration adds about $200 per year of stacked cost; the real number depends on which state you live in and ranges from $50 to over $800 depending on jurisdiction.
| Scenario | Year 1 | Each year after | 3-year total |
|---|---|---|---|
| You live in Kentucky, business operates there No foreign LLC registration needed. You pay Kentucky fees only. | $330 | $290 | $910 |
| You live in New Jersey, business operates there No foreign LLC registration needed. You pay New Jersey fees only. | $300 | $175 | $650 |
| Non-resident forming in Kentucky with operations elsewhere You pay Kentucky's fees plus a typical home-state foreign LLC registration of about $200 per year. | $530 | $490 | $1,510 |
| Non-resident forming in New Jersey with operations elsewhere You pay New Jersey's fees plus a typical home-state foreign LLC registration of about $200 per year. | $500 | $375 | $1,250 |
Kentucky vs New Jersey: full comparison
| Dimension | Kentucky | New Jersey |
|---|---|---|
| Online filing Can you file the formation document online? | Yes | Yes |
| Online approval time Standard, non-expedited | 1 business day | 3 business days |
| Expedited option Paid fast-track filing | Not offered | $25 |
| Annual report Required in addition to tax | Required, $15 | Required, $75 |
| State-imposed annual tax Franchise, privilege, or LLC tax minimum | $175 minimum | None |
| State income tax On pass-through LLC income at member level | Yes | Yes |
| Publication requirement Newspaper publication after formation | No | No |
| Operating agreement Required by state statute | Recommended, not required | Recommended, not required |
| Foreign LLC fee Cost to register as a foreign LLC in this state | $90 | $125 |
| State sales tax General statewide rate | 6.0% | 6.6% |
Taxes in Kentucky and New Jersey
How each state handles entity-level tax on LLCs. Pass-through classification means member-level income tax also applies at each member's residence state.
Kentucky tax
$175 minimum annual tax (gross-receipts-or-gross-profits basis). State income tax applies to member-level pass-through income. Corporate rate 5.0%.
New Jersey tax
No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income. Corporate rate 9.0%.
Ongoing compliance
The recurring filings each state requires after formation.
Kentucky
Annual report $15, due 06/30 each year. Registered agent required in Kentucky.
New Jersey
Annual report $75, due on your anniversary month. Registered agent required in New Jersey.
Formation process, side by side
What actually happens from the moment you start filing to the moment you're in good standing. Use this as a checklist.
Kentucky
- Check business-name availability on the Kentucky entity search.
- Appoint a registered agent with a physical Kentucky street address.
- File Articles of Organization for a Profit Limited Liability Company (Form KLC) for $40.
- Wait for approval. Online typically 1 business days. No paid expedite offered.
- Adopt an operating agreement (recommended, not required by Kentucky statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- File your first annual report and pay $15 when it comes due.
New Jersey
- Check business-name availability on the New Jersey entity search.
- Appoint a registered agent with a physical New Jersey street address.
- File Public Records Filing for New Business Entity (Certificate of Formation) for $125.
- Wait for approval. Online typically 3 business days. Paid expedite from $25.
- Adopt an operating agreement (recommended, not required by New Jersey statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- File your first annual report and pay $75 when it comes due.
Before you pick either state
A few things that apply no matter which state you choose. These trip up enough first-time filers that they're worth stating explicitly.
Registered agent is non-negotiable. Both Kentucky and New Jersey (and every other US state) require every LLC to designate a registered agent with a physical street address in the state of formation. You can serve as your own agent if you live in the state; otherwise a commercial agent runs $50 to $125 per year. Using your own home address makes it part of the public record.
Forming elsewhere does not escape your home state's tax. If you live and operate a business from your home state, forming the LLC in Kentucky or New Jersey does not avoid your home state's income tax. The moment you transact business at home, your home state requires a foreign LLC registration, and state tax liability follows your residence regardless of where the entity sits on paper.
EIN applications are free. The IRS issues Employer Identification Numbers directly at no cost. Any service charging you to "get your EIN" is reselling a free form submission. Single-member LLCs with no employees technically don't need one for federal tax, but nearly every bank requires an EIN to open a business account.
Operating agreement matters more than the state you pick. A well-drafted operating agreement governs member ownership, management, profit splits, buy-sell terms, and dissolution. Without one, your LLC runs on the state's default rules, which are rarely what you want. California, Maine, Missouri, and New York require a written one by statute; every other state treats it as strongly recommended.
Agency contacts
Kentucky Secretary of State, Business Filings
- Website
- www.sos.ky.gov/bus
- Phone
- (502) 564-3490
- Business Filings, Kentucky Office of the Secretary of State, P.O. Box 718, Frankfort, KY 40602-0718
- Office
- Room 154, Capitol Building, 700 Capital Avenue, Frankfort, KY 40601
- Hours
- 8:00 AM to 4:30 PM Eastern, Monday to Friday
New Jersey Division of Revenue and Enterprise Services
- Website
- www.nj.gov/treasury/revenue
- Phone
- (609) 292-9292
- NJ Division of Revenue, P.O. Box 252, Trenton, NJ 08646-0252
- Office
- 33 West State Street, 5th Floor, Trenton, NJ 08608
- Hours
- 8:30 AM to 4:30 PM Eastern, Monday to Friday
Kentucky Department of Revenue
- Website
- revenue.ky.gov
- Phone
- (502) 564-4581
- 501 High Street, Frankfort, KY 40601
- Hours
- 8:00 AM to 5:00 PM Eastern, Monday to Friday
New Jersey Division of Taxation
- Website
- www.nj.gov/treasury/taxation
- Phone
- (609) 292-6400
- NJ Division of Taxation, P.O. Box 248, Trenton, NJ 08646-0248
- Office
- 3 John Fitch Way, Trenton, NJ 08611
- Hours
- 8:30 AM to 4:30 PM Eastern, Monday to Friday
Frequently Asked Questions
-
Is it cheaper to form an LLC in Kentucky or New Jersey?
Kentucky is cheaper at formation ($40) than New Jersey ($125). Ongoing costs are also different: $290 vs $175 per year. Total over three years: $910 vs $650.
-
Can I form an LLC in Kentucky if I live in New Jersey?
Yes, but your New Jersey business will almost certainly need to register as a foreign LLC in New Jersey too, which means paying New Jersey's foreign registration fee and any ongoing New Jersey obligations on top of the Kentucky ones. The "form elsewhere to save" math usually doesn't work for operating businesses; it only works when you have no physical operations tied to any specific state.
-
How long does it take to form an LLC in Kentucky vs New Jersey?
Kentucky online: 1 business day; New Jersey online: 3 business days. Kentucky does not offer paid expedite. New Jersey offers paid expedite from $25.
-
Which state has lower taxes for an LLC, Kentucky or New Jersey?
Kentucky: state income tax applies to member-level pass-through income, plus a $175 minimum entity-level tax. New Jersey: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax.
-
Do both states require a registered agent?
Yes. Every US state (and DC) requires every LLC to maintain a registered agent with a physical street address in the state. Kentucky and New Jersey both have this requirement. You can serve as your own agent if you live in the state; most out-of-state filers use a commercial agent for $50 to $125 per year.
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Which state should I pick if I run an online business from home?
Form in the state you actually live in. Your home state's Department of Revenue treats your residence as nexus regardless of where the LLC is filed, which means you owe state income tax there anyway. Forming in Kentucky or New Jersey to escape your home state's tax doesn't work; it adds paperwork. The non-resident filings make sense when you genuinely operate nowhere in particular: international founders, purely passive holding entities, or real-estate LLCs owning property in other states.
Full state guides
More Kentucky and New Jersey comparisons
More Kentucky vs ...
Sources
- Filing fee: www.sos.ky.gov/bus/business-filings/Pages/Fees.aspx · verified April 21, 2026
Kentucky Secretary of State Business Filings Fees page: Articles of Organization (domestic LLC) filing fee is $40. Same fee for online filing through FastTrack and mail filings. Payable by cash, check to Kentucky State Treasurer, prepaid account, or debit/credit card. - Expedited filing: www.sos.ky.gov/bus/business-filings/Pages/Fees.aspx · verified April 21, 2026
Kentucky Secretary of State does not offer a separate paid expedited service for Articles of Organization. Online filings through FastTrack typically process within 1 business day (next-business-day for after-hours submissions), which serves as the de facto fastest available pathway. Recorded as offered: false. - Annual report fee: www.sos.ky.gov/bus/business-filings/Pages/Annual-Reports.aspx · verified April 21, 2026
Kentucky Secretary of State Annual Reports page: $15 filing fee, due between January 1 and June 30 each year. Failure to file by June 30 results in administrative dissolution. KRS 14A.6-010 establishes the filing requirement. - Franchise tax: revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entit… · verified April 21, 2026
Kentucky Department of Revenue: Limited Liability Entity Tax (LLET) imposed on all entities afforded limited-liability protection under state law (KRS 141.0401), including LLCs, corporations, S corporations, and limited partnerships. LLET is the lesser of 0.095% of Kentucky gross receipts or 0.75% of Kentucky gross profits, with a $175 minimum. Entities with gross receipts and gross profits both at or below $3M pay only the $175 minimum. Classified here as a franchise-style tax with a flat $175 annual minimum. - Foreign LLC registration fee: web.sos.ky.gov/forms/corp/FBE-Certificate%20of%20Authorization_Foreign… · verified April 21, 2026
Kentucky Form FBE Certificate of Authority for Foreign Business Entity: $90 filing fee. Same fee for online (FastTrack) and mail filings. - Operating agreement requirement: law.justia.com/codes/kentucky/chapter-275/section-275-003/ · verified April 21, 2026
Kentucky Revised Statutes Chapter 275 (Limited Liability Companies) defines an operating agreement as any agreement among members that may be written or oral. No statute requires LLCs to adopt a written operating agreement. Recorded as not required. - Publication requirement: law.justia.com/codes/kentucky/chapter-275/ · verified April 21, 2026
Kentucky does not require newspaper publication of LLC formation. KRS Chapter 275 contains no publication mandate. - Sales tax rate: revenue.ky.gov/Business/Sales-Use-Tax/pages/default.aspx · verified April 21, 2026
Kentucky Department of Revenue: statewide sales and use tax rate is 6% with no local sales tax jurisdictions. The 6% rate applies uniformly across the state. Local occupational license taxes (net profits or payroll) apply separately at the city and county level but are not sales taxes. - Corporate income tax rate: revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entit… · verified April 21, 2026
Kentucky corporate income tax is a flat 5% (KRS 141.040) for tax years beginning on or after January 1, 2018. Applies to C corporations and to LLCs electing corporate tax treatment. Separate from LLET, which applies at the entity level to all limited-liability entities. - Business name search: web.sos.ky.gov/ftsearch/ · verified April 21, 2026
Kentucky Secretary of State Business Entity Search (FastTrack Search). Use before filing Articles of Organization to confirm name availability. - Online filing portal: onestop.ky.gov/Pages/default.aspx · verified April 21, 2026
Kentucky Business One Stop portal, the official state gateway for online LLC formation via the FastTrack filing system. Online filings typically process within 1 business day. - Filing fee: www.nj.gov/treasury/revenue/fees.shtml · verified April 21, 2026
NJ Division of Revenue and Enterprise Services fee schedule: Certificate of Formation (domestic LLC) = $125. Same fee applies whether filing online, by mail, in person, or by fax. - Expedited filing: www.nj.gov/treasury/revenue/fees.shtml · verified April 21, 2026
NJ DORES expedited (over-the-counter) fee schedule: $25 per filing for standard expedited/OTC, $50 same-day fax, $500 2-hour service, $1,000 1-hour service. Report $25 OTC as the cheapest expedited tier. Online standard filings typically process within 1–3 business days without a separate expedite charge. - Certificate of Formation form: www.njportal.com/dor/businessformation/home/welcome · verified April 21, 2026
New Jersey does not publish a single fillable Certificate of Formation PDF specifically for LLCs. Formation is accomplished via the online 'Business Formation' portal (Public Records Filing for New Business Entity). Form L-102 is used only for amendments. Paper filers draft their own certificate per N.J.S.A. 42:2C-18. - Business name search: www.njportal.com/DOR/BusinessNameSearch/Search/BusinessName · verified April 21, 2026
New Jersey Business Name Search, operated by the Division of Revenue and Enterprise Services. Used to check name availability before filing a Certificate of Formation. - Operating agreement requirement: law.justia.com/codes/new-jersey/title-42/section-42-2c-11/ · verified April 21, 2026
N.J.S.A. 42:2C-11 defines and governs the operating agreement under the New Jersey Revised Uniform Limited Liability Company Act (RULLCA). Agreements may be written, oral, or implied; the statute does not require an LLC to adopt one. Default RULLCA provisions fill gaps. Justia is used as a neutral statute mirror because the legislature's official site (pub.njleg.gov) is often WAF-blocked. - Publication requirement: www.nj.gov/treasury/revenue/gettingregistered.shtml · verified April 21, 2026
New Jersey does not require LLCs to publish a notice of formation. Neither N.J.S.A. 42:2C-18 nor the DORES 'Getting Registered' guide imposes any newspaper-publication obligation. - Foreign LLC registration fee: www.nj.gov/treasury/revenue/fees.shtml · verified April 21, 2026
NJ DORES fee schedule: Certificate of Registration (foreign LLC) = $125. - Annual report fee: www.nj.gov/treasury/revenue/busrecords.shtml · verified April 21, 2026
NJ Annual Report filing fee for domestic and foreign LLCs = $75. Due on the last day of the LLC's anniversary month each year via the online Annual Report portal at njportal.com/DOR/annualreports. - Franchise tax: www.nj.gov/treasury/taxation/prntpart.shtml · verified April 21, 2026
NJ Division of Taxation Partnership Returns page and TB-55. LLCs taxed as partnerships pay a $150 per-owner Partnership Filing Fee (cap $250,000) with Form NJ-1065 under N.J.S.A. 54A:8-6. This is a filing fee, not a franchise tax, and it does not apply if the LLC elects C-corp treatment (which instead triggers the Corporation Business Tax). We record franchiseTax.applies = false because the state does not label or structure this as a franchise tax and it is capped at a per-owner count, not an entity minimum. - Corporate income tax rate: www.nj.gov/treasury/taxation/corp_over.shtml · verified April 21, 2026
NJ Division of Taxation Corporation Business Tax: tiered rates 6.5% (ENI ≤ $50k), 7.5% (ENI $50k–$100k), 9.0% (ENI > $100k). A 2.5% Corporate Transit Fee (CTF) applies on top of the 9% rate for taxpayers with allocated taxable net income above $10M, enacted 2024 and codified at N.J.S.A. 54:10A-5.41. We record the statutory 9% rate in the field; combined effective top rate of 11.5% is noted in taxes.notes. - Sales tax rate: www.nj.gov/treasury/taxation/businesses/salestax/index.shtml · verified April 21, 2026
NJ Division of Taxation Sales and Use Tax: statewide rate 6.625% since 2018 (N.J.S.A. 54:32B-3). No general local sales tax; Urban Enterprise Zones tax at half rate (3.3125%) on qualifying in-person sales, and Atlantic City imposes additional luxury/tourism taxes on specific purchases.