How to Start an LLC in Kansas

Are you looking to form a limited liability company (LLC) in Kansas, but you’re not sure where to begin? You have come to the right place!

In this article, you’ll learn:

• The process and the steps you need to take to start an LLC in Kansas
• Essential tasks to handle after you register your LLC
• The cost of starting a Kansas LLC and how long it takes

Keep reading if you’re ready to get started with your new Kansas LLC.

Last updated: Sep 2024

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Step 1: Name your Kansas LLC

The first step you need to take to start an LLC is to choose a name. Unfortunately, you can’t just use any name you like. There are certain words and phrases that must be included in your LLC name, while other words cannot be used at all. We’ve detailed Kansas’s LLC naming rules in the sections below.

Words You Have to Use

Under Kansas Statutes Section 17-7920, all LLC names must include one of these terms:

• “limited liability company”
• “limited company”
• “L. L. C.”
• “L. C.”
• “LLC”
• “LC”

Section 17-7920 also lists words that Kansas law allows in LLC names that some other states do not. Some of these words include:

• “association”
• “foundation”
• “institute”
• “trust”
• “union”

Words You Can’t Use

Generally, your LLC name can’t make it seem like your business is another type of entity like a corporation or partnership.

You also can’t name your LLC something that implies it does something illegal. For instance, if you don’t have a license to offer certain services, then your business’s name can’t indicate that it will perform those services.

Also, Kansas Statutes Section 17-7918 says that an LLC name must be distinct or “distinguishable” from all the other names that are registered with the Kansas Secretary of State. Check out the Name Availability Guidelines to learn more about how the Secretary of State decides if a name is distinguishable.

Research the LLC Name You Want

Once you’ve picked a name, you can check if it’s free to use on the Kansas Secretary of State’s Business Entity Search Station.

If you find out that someone else has already registered the name you want to use, there are two ways to proceed. One is to get the other party’s written consent to use the name. The other is to get a court order granting you permission to use it.

If the name you want is still available, Kansas Statutes Section 17-7923 lets you reserve it for 120 days. You can reserve a name online through kansas.gov’s KanAccess portal, which is the preferred method. You can also print and mail a Temporary Reservation of Business Entity form to the address below:

There is a $30 filing fee for online submissions and a $35 fee for paper forms.

Kansas DBA: Using a Fictitious Business Name

You are free to promote your Kansas LLC using its formal name. But, you can also use a “Doing Business As” or “DBA” to market your business. Many entrepreneurs prefer to use a DBA over the official company name because of the options it provides.

One of the benefits of a DBA is not having to use your full company name out in the real world. This is especially helpful if you want to keep “LLC” out of the business name, for instance. But keep in mind, you must still use your official name in legal documents.

Kansas law does not require LLCs to register their DBAs at the state level. However, depending on where your business is located, you may need to file a DBA with your city or county. You’ll need to check with your local governmental authorities to learn the requirements that apply to your LLC.

Step 2: Appoint a Registered Agent for your LLC

Registered agents, also known in Kansas as “resident agents,” are businesses or people who accept legal documents and other important papers for an LLC.

As per Kansas Statutes Section 17-7925, every LLC must appoint a resident agent. Resident agents must have a physical address in Kansas. They must also be available to receive service of process during normal business hours.

New LLC owners often think that it makes the most sense to name themselves as their company’s resident agent. There are definitely some advantages to this course of action:

• It’s cheap: You’re not paying someone else to do it for you.
• It’s easy: The only address and contact information you have to keep current is your own.
• It’s reliable: You will receive all important documents personally.

However, these business owners often have to learn the hard way that being your own Kansas registered agent also causes challenges.

Here are some of the problems that being your LLC’s resident agent can cause:

• No privacy: Your name and address will be published on the Secretary of State’s website. This means that anyone with an internet connection can find your personal information. 
• Junk mail/spam: You will get a ton of junk mail in addition to a small amount of real mail and any service of process.
• No breaks: You also must be available at all times during regular business hours to receive documents. This means no vacations, sick days, or leaving the office for lunch.
• Business interruptions: Client meetings can be interrupted by people serving process. That could be embarrassing or hurt your reputation.
• It’s your fault if you miss something: You always have to make sure your address is correct and up to date. If you make a mistake or miss something, you are held responsible.

Hiring a professional registered agent service might seem extravagant at first, but it usually is worth the price. Professional services charge about $100 each year, and they will let you know as soon as your LLC receives papers or mail.

If you’re planning to do business in other states, it’s best to go with a national registered agent service. This is because to do business outside Kansas, you must register as a foreign LLC and find a registered agent for each state. Choosing a national service will save you the hassle of finding an agent in every one of those states.

Step 3: File Your Kansas LLC Articles of Organization

Articles of Organization are the legal document that is used to form a Kansas LLC. To start your LLC, you’ll need to file articles of organization with the Kansas Secretary of State.

What to include in my Kansas Articles of Organization?

Under Kansas Statutes Section 17-7673, your LLC’s articles of organization must detail:

• The LLC’s name.
• The address of its registered office.
• The name of its resident agent.

The articles of organization can also discuss any other issues that you want to include in them.

You can file online using the KanAccess portal. Alternatively, you can also submit an articles of organization form by mail or fax (785-296-4570).

Kansas LLC Filing Fee

According to the Kansas Secretary of State’s Business Services Forms list, the filing fee for articles of organization is $160 if you file online and $165 if you file by mail. There is an additional $20 fee for fax filing.

Read More: How Much Does It Cost to Form an LLC in Kansas

Kansas LLC Processing Time

If you submit articles of organization online, your filing will be effective immediately. Paper registrations will typically be processed within 3 to 5 days.

Step 4: Draft your Kansas LLC Operating Agreement

Operating agreements are contracts made by LLC owners to formally establish how the company will be run. The agreement outlines each member’s rights and obligations, as well as other important rules for the business.

LLCs in Kansas are not required to have operating agreements. But, it’s still a good idea to make one because they establish how issues will be handled ahead of time.

For instance, an operating agreement can help you plan for important events, such as a member wanting to sell their share of the company. The contract will establish the process for buying back the member’s interest and reassigning their duties.

Some additional benefits of an operating agreement include:

• They determine the rights and duties of LLC members. If one LLC member is responsible for running the business or managing the books, the operating agreement should say so. 
• They say what the manager has the right to do. Managers also have special duties to the company and the members. The operating agreement should state these.
• They outline what the LLC is legally able to do. The operating agreement should also set down how the company is allowed to conduct its business from day to day.
• They say how new members can join the company. They also have rules about how exiting members can leave.
• They set down how and when profits are paid to members. They can also create different types of membership and payment schemes.
• They say whether members or managers are in charge. They also say how to hire and fire managers.
• They say how and under what circumstances the LLC should end. You might not want to dissolve your business now, but you might in the future. It’s best to think about it and plan before it becomes an issue.
• They say how to change the rules. You may need to amend your operating agreement in the future. The operating agreement should set down the rules for making changes.

An operating agreement ensures everyone is on the same page and can help prevent future arguments. All members should participate in writing the LLC operating agreement. This way, each member will be aware of the rules for the LLC and understand their role in the business.

Suppose there are disagreements among the LLC members. In that case, Kansas Statutes Section 17-7672 allows you to file an action to interpret, apply, or enforce the provisions of an LLC operating agreement in your local district court.

Step 5: Get an EIN (Employer Identification Number) for Your Kansas LLC

An EIN, or Employer Identification Number, is a nine-digit number issued by the Internal Revenue Service to identify businesses. This government ID number is similar to an SSN in that it can be used for identification purposes. However, while SSNs are assigned to people, EINs are assigned to businesses.

Here are the most common times when you need an EIN:

• Does your LLC have more than one member? 
• Does your LLC have any employees? 
• Is your LLC taxed as a C corporation or S corporation?

If you answered “yes” to any of these questions, your LLC needs to get an EIN.

If your LLC is owned by one person, you can choose to use your SSN instead of an EIN to file taxes. However, if you want to avoid fraud or keep your LLC’s finances separate from your personal funds, then get an EIN. Most banks require an EIN to open a business bank account.

You can get an EIN quickly and easily through the IRS website or by filling out Form SS-4 and mailing it in. The entire process is free, so you don’t need to spend money for someone else to do it for you. A few minutes of your time is all it takes.

Read More: How to Get an Employer Identification Number in Kansas

First Tasks After Registering your Kansas LLC

Once you finish your Kansas LLC formation, there are some tasks you will need to complete to get your company off the ground. Although these tasks are not legally required, they will have an impact on your company’s success.

Open a Business Bank Account

You don’t have to open a business bank account when forming an LLC. However, we always recommend that you do so.

Using a separate bank account for your LLC allows you to keep your personal assets separate from your business’ funds. This way, you won’t have to worry about your personal assets being seized to pay the LLC’s creditors.

Opening a business bank account provides many benefits, such as:

• Convenience: Keeping things separate makes your LLC’s bookkeeping much simpler.
• More business opportunities: Your LLC can only receive credit card payments through a business account. You can also do business with people who won’t take personal payments. 
• Personal asset protection: Mixing your personal and business funds could cause you to be held responsible for the LLC’s debts. 

Asset protection is the most crucial of these advantages.

An LLC is a legal structure that offers protection from being held personally liable for debts related to the company. So, creditors can’t go after your personal belongings to pay them back. This is known as the “corporate veil.”

But if you use your business’ funds for personal purposes or “commingle” your own money with company funds, the corporate veil can be “pierced” in a lawsuit. This means you could be liable for any debt that the LLC owes if it gets sued.

A good way to avoid the piercing of the corporate veil is to open up a separate bank account for the company. This way, if the LLC has to deal with any legal issues, your personal money will be unaffected and remain safe.

Get Business Insurance For Your Kansas LLC

When you start your Kansas LLC, you should also consider investing in business insurance. You should think of the types of risks that you face in your industry and then tailor your policy choices to meet your needs.

You can choose from a range of business insurance options, such as:

• General liability insurance: You’ll need this if there’s an injury on your property. It pays for damages and a lawyer if you need one.
• Commercial automobile insurance: This works like your own car insurance. It covers drivers and vehicles for your business.
• Workers’ compensation insurance: Kansas law makes all employers carry workers’ compensation coverage, with a few exceptions. You can choose to buy a policy from a private insurance company or self-insure.
• Commercial property insurance: This protects your property in the event of damage. Keep in mind that flood insurance is often a separate policy.
• Professional liability insurance: Lawyers, doctors, architects, and other professionals need this insurance. It provides coverage and legal defense in the event of a malpractice case.
• Business income insurance: If you have to close for some time, business income insurance can pay back the loss of income. Policies vary, though. Make sure that you know exactly what kinds of losses will be covered.

Keep Your Kansas Company Compliant

If you’re starting an LLC in Kansas, you should be mindful of the state regulations you need to follow. For example, you may need to get a business license or pay certain taxes.

It’s vital to keep an eye on regulations, as they may change from time to time. By doing so, you’ll always remain compliant with the local rules.

Kansas Business Permits and Licenses

In Kansas, some types of businesses require permits or licenses to operate. County and local governments may also have local permitting requirements. The Kansas Business One Stop’s resources on Common Business Licenses and Permits is a good place to start your research.

Kansas Tax Requirements

State income taxes generally do not apply to LLCs. However, they may need to pay other taxes, such as sales and use taxes on certain items. You can visit the Kansas Department of Revenue’s website to learn more.

Federal LLC Tax Filing Requirements

LLCs are usually “pass-through” entities for federal tax purposes, which means that the business will not be taxed on its profits. Instead, you’ll need to fill out a Schedule C form to report your LLC’s earnings or losses and submit it with your personal tax return.

Also, LLCs must pay Social Security and Medicare taxes, even if they don’t employ any workers. If your LLC does have employees, you’ll be required to deduct payroll taxes from their wages.

Biennial Information Report and other Filing Requirements 

Kansas Statutes Section 17-76,139 requires all LLCs to submit a biennial information report to the Secretary of State. You can file your report online for a $100 filing fee or by mail with a $110 filing fee.

Kansas Business Formation Quick Links

• IRS — apply for an EIN online
• IRS information regarding the federal tax treatment of LLCs
• Business Filing Center: Name Availability (SOS)
• Business Entity Search Station (SOS)
• Business Services Forms (SOS)
• Business Entity – FAQ (SOS)
• KanAccess Online Filing Portal
• Kansas Business One Stop

Statutes:

• Name Requirements: Kansas Statutes Section 17-7920
• Name Distinguishability: Kansas Statutes Section 17-7918 
• Name Reservation: Kansas Statutes Section 17-7923
• Resident Agent: Kansas Statutes Section 17-7925
• Articles of Organization: Kansas Statutes Section 17-7673
• Operating Agreement: Kansas Statutes Section 17-7672 
• Annual Report: Kansas Statutes Section 17-76,139