Schedule Llet (Form 41a720llet) - Limited Liability Entity Tax Page 2
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41A720LLET (10-11)
Commonwealth of Kentucky
INSTRUCTIONS – SCHEDULE LLET
DEPARTMENT OF REVENUE
through entity or general partnership (organized or formed as
Purpose of Schedule—Schedule LLET, Limited Liability Entity
Tax, is used to compute the limited liability entity tax (LLET)
a general partnership after January 1, 2006) doing business in
as provided by KRS 141.0401(2), and must be completed and
Kentucky, complete Schedule LLET-C and enter the total amounts
submitted with the applicable tax return (Form 720, 720S, 725
from Schedule LLET-C, Section A, Lines 3 and 5 in Column A, Lines
or 765). If the corporation or limited liability pass-through entity
3 and 5; and the total amounts from Schedule LLET-C, Section
B, Lines 3 and 5 in Column B, Lines 3 and 5, and continue to
filing the tax return is a partner or member of a limited liability
pass-through entity or general partnership (organized or formed
Sections B, C and D.
as a general partnership after January 1, 2006) doing business
If the corporation or limited liability pass-through entity filing
in Kentucky, complete Schedule LLET-C, Limited Liability Entity
the tax return is not a partner or member of a limited liability
Tax—Continuation Sheet.
pass-through entity or general partnership (organized or formed
as a general partnership after January 1, 2006) doing business
Short-Period Computation of LLET—For short-period returns,
annualizing gross receipts or gross profits is not permitted. A
in Kentucky, complete Section A as follows:
minimum of $175 shall be due per taxable year. Taxable year
Line 1—Enter the Kentucky gross receipts before returns and
is defined as the period for which the return is made. KRS
allowances in Column A, and gross receipts from all sources
141.010(16)
before returns and allowances in Column B.
Combined Group—A member of a combined group pursuant to
Line 2—Enter the returns and allowances attributable to Kentucky
KRS 141.0401(1)(c) must use the total gross receipts and the total
gross receipts in Column A, and returns and allowances
gross profits of the combined group to determine if it is eligible
attributable to gross receipts from all sources in Column B.
for the small business relief provided by KRS 141.0401(2)(b).
The member computes its LLET based upon its Kentucky gross
Line 3—Enter the total of Line 1 less Line 2 in Columns A and B.
receipts and Kentucky gross profits. A combined group means
all members of an affiliated group as defined in KRS 141.200(9)
Line 4—Enter the cost of goods sold attributable to Kentucky
(b) and all limited liability pass-through entities that would be
gross receipts in Column A, and cost of goods sold attributable
included in an affiliated group if organized as a corporation as
to gross receipts from all sources in Column B. For an entity
provided by KRS 141.0401(1)(c).
other than manufacturing, producing, reselling, retailing or
wholesaling, no costs shall be included in cost of goods sold.
Section A of this schedule must be completed by a corporation
KRS 141.0401(1)(d)
or limited liability pass-through entity, except a corporation
or limited liability pass-through entity exempt from LLET as
Line 5—Enter the total of Line 3 less Line 4 in Columns A and B.
provided by KRS 141.0401(6). If the corporation or limited liability
pass-through entity filing the tax return is a partner or member
Section B—Computation of Gross Receipts LLET
of a limited liability pass-through entity or general partnership
(organized or formed as a general partnership after January 1,
Line 1—If gross receipts from all sources (Column B, Line 3) are
2006) doing business in Kentucky, complete Schedule LLET-C,
$3,000,000 or less, STOP and enter $175 on Section D, Line 1.
Limited Liability Entity Tax—Continuation Sheet. Kentucky
gross receipts, Kentucky gross profits, total gross receipts from
Line 2—If gross receipts from all sources (Column B, Line 3)
all sources, and total gross profits from all sources must be
are greater than $3,000,000 but less than $6,000,000, enter the
completed in accordance with KRS 141.0401(1). See the line-by-
following: (Column A, Line 3 x 0.00095) – ($2,850 x (($6,000,000
line instructions below.
– Column A, Line 3) / $3,000,000)), but in no case shall the result
be less than zero.
Section B of this form must be completed to compute the LLET
on Kentucky gross receipts.
Line 3—If gross receipts from all sources (Column B, Line 3) are
$6,000,000 or greater, enter the following: Column A, Line 3 x
Section C of this form must be completed to compute the LLET
0.00095.
on Kentucky gross profits.
Line 4—Enter the amount from Line 2 or Line 3.
Section D of this form must be completed to show the LLET
liability before the application of any tax credits.
Section C—Computation of Gross Profits LLET
LINE-BY-LINE INSTRUCTIONS
Line 1—If gross profits from all sources (Column B, Line 5) are
$3,000,000 or less, STOP and enter $175 on Section D, Line 1.
Check Box—If the entity is a member of a combined group
pursuant to KRS 141.0401(1)(c), check the box.
Line 2—If gross profits from all sources (Column B, Line 5) are
greater than $3,000,000 but less than $6,000,000, enter the
Reason Code—If the box is checked, enter the applicable code.
following: (Column A, Line 5 x 0.0075) – ($22,500 x (($6,000,000
1
Gross receipts or gross profits from all sources are equal
– Column A, Line 5) / $3,000,000)), but in no case shall the result
to or less than $3,000,000.
be less than zero.
2
Gross receipts and gross profits from all sources are greater
Line 3—If gross profits from all sources (Column B, Line 5) are
than $3,000,000 but less than $6,000,000.
$6,000,000 or greater, enter the following: Column A, Line 5 x
3
Gross receipts from all sources are equal to or greater than
0.0075.
$6,000,000 but gross profits from all sources are greater
than $3,000,000 but less than $6,000,000.
Line 4—Enter the amount from Line 2 or Line 3.
4
Gross receipts and gross profits from all sources are equal
to or greater than $6,000,000.
Section D—Computation of LLET
Section A—Computation of Gross Receipts and Gross Profits
Line 1—Enter the lesser of Section B, Line 4 or Section C, Line 4,
If the corporation or limited liability pass-through entity filing
or a minimum of $175 on this line and on Form 720, Part I, Line
the tax return is a partner or member of a limited liability pass-
1; for Form 720S, 725 or 765, enter on Part II, Line 1.
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