KY LLET (Limited Liability Entity Tax)

[Mark S.]

I received a letter in the mail from the Department of Revenue in Kentucky prompting me to register online for tax accounts for my business (I started an LLC in 2016 in KY for the purpose of asset protection for real estate). I went through the online registration process which seemed pretty straightforward with a couple of minor exceptions. I then received a phone call about a discrepancy regarding the responsible party for the LLC taxes. During that conversation, I was made aware that there is a minimum Limited Liability Entity Tax (LLET) of $175 that is due each year. Even though my LLC currently holds no properties and has no income, I am told o still need to pay this tax by April 2017 because I organized in 2016. It sounds like I may need to file an amended return. I'm a little confused. I currently do my own taxes online and do not remember seeing an option for this (although I did deduct my small start up business costs). Is this something I can file online via an amended return? Is it worth contacting a CPA or tax advisor about this at this point in busy season with just one month to go? It seems like it should be a really easy fix and the KY Dept of Revenue is supposed to be mailing me a bill / letter / whatever after she updated my information to reflect my goal of being a single member LLC treated as a disregarded entity for tax purposes (which she's says is considered to be taxed as a sole proprietorship and still subject to the LLET). Is there a way to just pay this without amending a return? I'm lost. Any help is appreciated. And yes, I know, this is another reason new REIs may consider NOT creating an LLC until necessary (if at all). @Dave Holland

[Mark S.]

Pavel Reyes Valdes , thanks for your response. I knew this sounded odd. She made it sound like there's no way around it and I told her exactly what my intentions were and how I wanted to be taxed. She kept saying that as a disregarded entity it's still taxed as a sole proprietorship and I still owe the LLET. Weird.