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Electronic Funds Transfer (EFT)—The Department of Revenue

Estimated Tax Payments—A single member LLC must make

is accepting electronically filed Corporation Income Tax/

estimated tax installments if its tax liability under KRS 141.0401

Limited Liability Entity Tax estimated tax voucher payments

can reasonably be expected to exceed $5,000. Estimated tax

and extension payments for corporation income tax and limited

installments are required as follows:

liability entity tax. Before filing by EFT, the single member LLC

must have a valid six-digit Kentucky Corporation/LLET Account

If the estimated tax is reasonably expected to exceed $5,000

Number and have registered with the Department of Revenue

before the 2nd day of the 6th month, 50% of the estimated tax

to file EFT. Using an incorrect account number, such as an

must be paid by 15th day of the 6th month, 25% by the 15th day

account number for withholding or sales and use tax, will result

of the 9th month, and 25% by the 15th day the 12th month.

in the payment being credited to another taxpayer’s account.

For more information contact the Department of Revenue at

If the estimated tax is reasonably expected to exceed $5,000 after

(800) 839-4137 or (502) 564-6020. The EFT registration form

the 1st day of the 6th month and before the 2nd day of the 9th

is available at See E-file & E-Payment

month, 75% of the estimated tax must be paid by the 15th day

Options (click on KY E-Tax). The direct link is

of the 9th month, and 25% by the 15th day the 12th month.

ky.gov/etax.htm.

If the estimated tax is reasonably expected to exceed $5,000

Accounting Procedures—Kentucky income tax law requires

after the 1st day of the 9th month, 100% of the estimated tax

must be paid by the 15th day the 12th month.

a taxpayer to report income on the same calendar or fiscal

year and to use the same methods of accounting required for

federal income tax purposes. Any federally approved change

Safe harbor: A single member LLC can satisfy its declaration

in accounting periods or methods must be reported to the

requirement if its estimated tax payments are equal to the tax

Department of Revenue. Attach a copy of the federal approval

liability under KRS 141.0401 for the prior tax year, and its tax

to the return when filed. KRS 141.140

liability for the prior tax year was equal to or less than $25,000.

If the estimated tax is based on the single member’s tax liability

Filing/Payment Date—A Kentucky Single Member LLC

for the prior tax year, 50% of the estimated tax must be paid

Individually Owned LLET Return must be filed and payment

by 15th day of the 6th month, 25% by the 15th day of the 9th

must be made on or before the 15th day of the fourth month

month, and 25% by the 15th day the 12th month.

following the close of the taxable year. KRS 141.160, KRS 141.220

Interest: Failure to pay estimated tax installments on or before the

and 103 KAR 15:050

due date prescribed by KRS 141.042 and 141.044 shall result in

If the filing/payment date falls on a Saturday, Sunday or a legal

an assessment of interest on the late payment or underpayment.

holiday, the filing/payment date is deemed to be on the next

The interest due on any late payment or underpayment shall

business day. KRS 446.030(1)(a)

be at the rate provided by KRS 131.183(1). KRS 141.042(4) and

KRS 141.985

Mailing/Payment—Mail the return with payment to Kentucky

Penalty: Failure to pay estimated tax installments equal to

Department of Revenue, Frankfort, KY 40620. Make the check

the amount determined by subtracting $5,000 from 70% of

payable to Kentucky State Treasurer.

the combined tax liability due under KRS 141.040 and KRS

Extensions—An extension of time to file a Kentucky Single

141.0401 as computed by the taxpayer on the return filed for

Member LLC Individually Owned LLET Return (Form 725)

the taxable year will result in an underpayment penalty of 10%

may be obtained by either making a specific request to the

of the underpayment. The underpayment penalty will not apply

Department of Revenue on Form 41A720SL, Application for

if the estimated tax payments are equal to or greater than the

Six–Month Extension of Time to File Kentucky Corporation or

combined tax liability due under KRS 141.040 and KRS 141.0401

Limited Liability Pass-through Entity Return, or attaching either

for the previous taxable year, and the combined tax liability due

a copy of the Kentucky individual extension (Form 40A102) or

under KRS 141.040 and KRS 141.0401 for the previous taxable

a copy of the federal individual extension (Form 4868) to the

year was equal to or less than $25,000. KRS 131.180(3) and

return when filed. A copy of the federal extension submitted

KRS 141.990(3)

after the return is filed does not constitute a valid extension,

and late filing penalties will be assessed. If the single member

Other Information

LLC is making a payment with its extension, Form 41A720SL

must be used. For further information, see the instructions for

Amended Return—To correct Form 725 as originally filed,

Form 41A720SL. 103 KAR 15:050

file an amended Form 725 and check the appropriate box on

page 1.

NOTE: An extension of time to file a return does not extend the

Records Retention—The Department of Revenue deems

date for payment of tax.

acceptable virtually any records retention system which results

LLET Estimated Taxes

in an essentially unalterable method of records storage and

retrieval, provided: (a) authorized Department of Revenue

The Corporation Income/Limited Liability Entity Tax Estimated

personnel are granted access, including any specialized

Tax Voucher, Form 720-ES, is used to submit estimated tax

equipment; (b) taxpayer maintains adequate back–up; and (c)

payments for LLET. See Electronic Funds Transfer (EFT) on this

taxpayer maintains documentation to verify the retention system

is accurate and complete.

page. If the single member LLC is required to make estimated

LLET payments and needs Form 720-ES vouchers, contact the

Department of Revenue at (502) 564-3658 or visit the website

Internal Revenue Service Audit Adjustments—A Kentucky

individually owned single member LLC which has received final

adjustments resulting from Internal Revenue Service audits

NOTE: See ky.gov for information on the 2014

must submit a copy of the “final determination of the federal

estimated tax payments.

Instructions For Form 725 - Kentucky Single Member Llc Individually Owned Llet Return - 2013 Page 5

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