Schedule Llet (Form 41a720llet) - Limited Liability Entity Tax Page 2
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41A720LLET (10-13)
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,
or 765). If the corporation or limited liability pass-through entity
Lines 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
filing the tax return is a partner or member of a limited liability
pass-through entity or general partnership (organized or formed
to 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
Short-Period Computation of LLET—For short-period returns,
as a general partnership after January 1, 2006) doing business
annualizing gross receipts or gross profits is not permitted.
in Kentucky, complete Section A as follows:
A minimum of $175 shall be due per taxable year. Taxable
year is defined as the period for which the return is made. KRS
If the company is computing its LLET based on gross profits,
Schedule COGS, Limited Liability Entity Tax Cost of Goods Sold,
141.010(16)
must be attached to the applicable tax return.
Combined Group—A member of a combined group pursuant to
Line 1—Enter the Kentucky gross receipts before returns and
KRS 141.0401(1)(c) must use the total gross receipts and the total
gross profits of the combined group to determine if it is eligible
allowances in Column A, and gross receipts from all sources
for the small business relief provided by KRS 141.0401(2)(b).
before returns and allowances in Column B.
The member computes its LLET based upon its Kentucky gross
Line 2—Enter the returns and allowances attributable to Kentucky
receipts and Kentucky gross profits. A combined group means
gross receipts in Column A, and returns and allowances
all members of an affiliated group as defined in KRS 141.200(9)
attributable to gross receipts from all sources in Column B.
(b) and all limited liability pass-through entities that would be
included in an affiliated group if organized as a corporation as
Line 3—Enter the total of Line 1 less Line 2 in Columns A and B.
provided by KRS 141.0401(1)(c).
Line 4—Enter the Kentucky Cost of Goods Sold and Total Cost of
Section A of this schedule must be completed by a corporation
Goods Sold from Schedule COGS, Columns A and B, Line 8 on
or limited liability pass-through entity, except a corporation
Columns A and B, Line 4, respectively. For an entity other than
or limited liability pass-through entity exempt from LLET as
manufacturing, producing, reselling, retailing or wholesaling,
provided by KRS 141.0401(6). If the corporation or limited liability
no costs shall be included in cost of goods sold. KRS 141.0401(1)(d)
pass-through entity filing the tax return is a partner or member
of a limited liability pass-through entity or general partnership
Line 5—Enter the total of Line 3 less Line 4 in Columns A and B.
(organized or formed as a general partnership after January 1,
Section B—Computation of Gross Receipts LLET
2006) doing business in Kentucky, complete Schedule LLET-C,
Limited Liability Entity Tax—Continuation Sheet. Kentucky
Line 1—If gross receipts from all sources (Column B, Line 3) are
gross receipts, Kentucky gross profits, total gross receipts from
$3,000,000 or less, STOP and enter $175 on Section D, Line 1.
all sources, and total gross profits from all sources must be
completed in accordance with KRS 141.0401(1). See the line-by-
Line 2—If gross receipts from all sources (Column B, Line 3)
line instructions below.
are greater than $3,000,000 but less than $6,000,000, enter the
following: (Column A, Line 3 x 0.00095) – ($2,850 x (($6,000,000
Section B of this form must be completed to compute the LLET
– Column A, Line 3) / $3,000,000)), but in no case shall the result
on Kentucky gross receipts.
be less than zero.
Section C of this form must be completed to compute the LLET
Line 3—If gross receipts from all sources (Column B, Line 3) are
on Kentucky gross profits.
$6,000,000 or greater, enter the following: Column A, Line 3 x
0.00095.
Section D of this form must be completed to show the LLET
liability before the application of any tax credits.
Line 4—Enter the amount from Line 2 or Line 3.
LINE-BY-LINE INSTRUCTIONS
Section C—Computation of Gross Profits LLET
Check Box—If the entity is a member of a combined group
Line 1—If gross profits from all sources (Column B, Line 5) are
pursuant to KRS 141.0401(1)(c), check the box.
$3,000,000 or less, STOP and enter $175 on Section D, Line 1.
Reason Code—If the box is checked, enter the applicable code.
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
1
Gross receipts or gross profits from all sources are equal
following: (Column A, Line 5 x 0.0075) – ($22,500 x (($6,000,000
to or less than $3,000,000.
– Column A, Line 5) / $3,000,000)), but in no case shall the result
2
Gross receipts and gross profits from all sources are greater
be less than zero.
than $3,000,000 but less than $6,000,000.
Line 3—If gross profits from all sources (Column B, Line 5) are
3
Gross receipts from all sources are equal to or greater than
$6,000,000 or greater, enter the following: Column A, Line 5 x
$6,000,000 but gross profits from all sources are greater
0.0075.
than $3,000,000 but less than $6,000,000.
Gross receipts and gross profits from all sources are equal
4
Line 4—Enter the amount from Line 2 or Line 3.
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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