Starting a service business in Kentucky

Form your business in Kentucky

File Articles of Organization with the Kentucky Secretary of State. The fee for a domestic LLC is $40 on the Secretary of State's published fees in October 2026. The Secretary of State's checklist of next steps after forming includes getting a federal EIN, registering for state taxes and unemployment insurance, and confirming workers' comp coverage with the Department of Workers' Claims.

Ongoing state filings

Every entity doing business in Kentucky must file an annual report by June 30 of each year after the year it was formed, per the Secretary of State. The fee is $15 as listed in October 2026. Missing June 30 puts the LLC in bad standing and can lead to administrative dissolution, and reinstatement after dissolution carries a $100 penalty.

Using a business name (DBA)

Kentucky's assumed name law (KRS 365.015) splits by owner. A sole proprietor files a certificate of assumed name with the county clerk where the business has its principal place of business. An LLC or corporation files with the Secretary of State, for $20 as listed in October 2026, and then files a stamped copy with the county clerk in the county where its registered agent is located. An assumed name lasts five years and can be renewed in the six months before it expires.

Not sure whether you need an LLC at all? Read LLC vs sole proprietor for contractors, then get your free EIN from the IRS.

Licensing for service trades

The Department of Housing, Buildings and Construction (HBC) licenses or certifies plumbers, electricians, boiler contractors, fire sprinkler and fire alarm contractors, and building inspectors, and it enforces statewide building standards. HVAC work is licensed too: KRS 198B.656 bars anyone from working as a master HVAC contractor or journeyman without a license, and KRS 198B.6671 requires a permit before installing an initial HVAC system. HBC sells permits through its online portal. Painting, cleaning, mowing and handyman work are not on HBC's list, and the Secretary of State's startup checklist points owners to local occupational license fees set by counties and cities, so check with each place you work.

• Kentucky Department of Housing, Buildings and Construction: Plumber, electrician, HVAC, boiler, fire sprinkler and fire alarm licenses and permits

Workers' compensation

Under KRS 342.630, any employer with one or more employees in Kentucky, other than one engaged solely in agriculture, is subject to the workers' comp law. The Department of Workers' Claims says every employer with an employee covered by the act must secure its liability, through an insurance policy or approved self-insurance. The department runs an online coverage lookup, which is a fast way to confirm a subcontractor is covered before you send them to a job.

More on coverage: business insurance for contractors.

Sales tax on services

Kentucky's 6% sales tax applies to retail sales of goods and to services listed in KRS 139.200, and the list reaches deep into home services. It includes landscaping services, defined to cover lawn care and maintenance, tree trimming, pruning or removal, design and installation of plantings, and snow plowing or removal; janitorial services, including residential and commercial cleaning and carpet, upholstery and window cleaning; pet care such as grooming, boarding, pet sitting and obedience training; and residential and nonresidential security system monitoring. If you sell any listed service, register with the Department of Revenue for a sales and use tax permit before you invoice. The Department of Revenue publishes separate guidance on sales of taxable services to builders and contractors.

Recording business calls in Kentucky

Kentucky is one-party consent. KRS 526.010 defines eavesdropping as recording a wire or oral communication of others without the consent of at least one party, which means a Kentucky company may record calls it takes part in. Customers calling from all-party states can complicate that, as our guide to recording business calls explains.

See our guide to recording business calls before you turn on call recording or an AI receptionist.

How the seasons shape the work

Kentucky sits on the line between snow and ice: Louisville and northern Kentucky get regular snow events, while the south and west see more freezing rain, so plow and salt contracts are real but irregular, and they are taxable. Long, humid summers stretch the mowing season from spring into late fall and keep air conditioning techs busy. Spring storms and flooding in the eastern hollows bring tree, roofing and cleanup work.

Assumed names need two filings for an LLC

Because KRS 365.015 requires an LLC to file its assumed name with the Secretary of State and then file a stamped copy with the county clerk where its registered agent is, a single-trade LLC that does business as a second brand name has two offices to deal with. Keep the stamped copy; you will need it at the county clerk and often at the bank.

Then set up the back end that gets you hired

The paperwork makes you legal. Customers still have to find you, reach you and pay you. Before your first job, set up a business phone number, email on your own domain, a Google Business Profile, a simple website, and a way to send quotes and take card payments. The launch checklist lays out the order.

Kentucky questions