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Ever wondered where the best selling truck in the U.S – the Ford F-Series is being manufactured? Louisville, Kentucky! A major coal producer, the bluegrass state has been ranked as one of the top states 4 years in a row for new and expanded industry activity per capita. This is the state that is considered as the headquarters for some really major league players including General Motors, Ford, Toyota, Humana, Papa John’s, and YUM! Brand.
There is a lot more to Kentucky than meets the eye! Over the years, the state has offered a variety of incentives, tax credits, and grants to small businesses as well as large corporations. Let’s take a look at what advantages are there for your business, if you register in this state.
Independent Life and Tax Credit
One of the salient advantages of an S Corporation in Kentucky is that it enjoys an independent life. The death or incapacitation of a stockholder will not disturb operations of the business. One of the other advantages of a startup company in Kentucky is the Kentucky Small Business Tax Credit (KSBTC) program. Eligible businesses paying taxes imposed by program KRS 141.040 (corporation income tax) can apply for a non-refundable state income tax credit that can vary from $3,500 – $25,000.
Pass through Taxation and LCC Limit Liability
If you register a new company in Kentucky as an S corporation then the corporation or firm will not pay any income tax. Instead, the income or loss of the corporation will be passed on to the stockholders.
If you register a new business in Kentucky as an LLC then you will be able to enjoy limited liability protection. This means claimants can sue the LLC and not the owner or investors.
Flexible Profit Distribution and State Tax Credit
An LLC has the benefit of being able to select different ways of distribution of profits. One of the advantages of a startup company in Kentucky is the Kentucky Small Business Tax Credit (KSBTC) program. Eligible businesses paying taxes imposed by program KRS 141.0401 (limited liability entity tax) can apply for a non-refundable state income tax credit that can vary from $3,500 – $25,000.
The number of small businesses in Kentucky grew from 341,147 in 2015 to 347,159 in 2017 and this trend is mostly due to the variety of business incentives provided through state based programs. Once you register a new business in Kentucky, you will be able to qualify for most of the programs and this can help promote financial growth and expansion for businesses in a large number of industries.