Kentucky Sale and Assignment of a Percentage Ownership Interest in a Limited Liability Company

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A limited liability company (LLC) is a separate legal entity that can conduct business just like a corporation with many of the advantages of a partnership. It is taxed as a partnership. Its owners are called members and receive income from the LLC just as a partner would. Management of an LLC is vested in its members. An operating agreement is executed by the members and operates much the same way a partnership agreement operates. Profits and losses are shared according to the terms of the operating agreement.


A membership interest may be used to refer to the ownership interest of a member in the LLC. The word unit is often used to reflect the membership interests of a member in the LLC. Some LLC's issue membership interest certificates. To become a new member of the LLC the consent of majority of the members is necessary. A transfer of units of an existing member does not automatically include membership into the LLC.

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FAQ

In the case of corporations, an ownership interest is represented by ownership of voting stock. In the case of partnerships or limited liability companies, an ownership interest is represented by total interest in capital and profits.

A single member LLC whose single member is an individual, estate, trust, or general partnership must file a Kentucky Single Member LLC Individually Owned Income and LLET Return (Form 725) or a Kentucky Single Member LLC Individually Owned LLET Return (Form 725-EZ) to report and pay any LLET that is due.

James Publishing, 1995). The owners of an LLC are called ?members.? A member can be an individual, partnership, corporation, trust, and any other legal or commercial entity.

Business Ownership Interest refers to a designated shareholding in the ownership of a business enterprise. Such business ownership comes with privileges which depend on the size of the shareholding as may be contained in the shareholding agreement. The size of the ownership affects the valuation outcome.

A Limited Liability Entity Tax (LLET) applies to both C corporations and Limited Liability Pass-Through Entities (LLPTEs) and is not an alternative to another tax. However, corporations paying the LLET are allowed to apply that amount as a credit towards its regular corporate income tax.

In the case of corporations, an ownership interest is represented by ownership of voting stock. In the case of partnerships or limited liability companies, an ownership interest is represented by total interest in capital and profits.

Ownership equity is also known as risk capital or liable capital. In financial accounting, equity capital is the owners' interest on the assets of the enterprise after deducting all its liabilities. It appears on the balance sheet/statement of financial position, one of the four primary financial statements.

If your LLC has an OA, then all you need to do to transfer your LLC ownership in Kentucky is to follow the transfer and sale provisions detailed in that OA. If your LLC doesn't have an OA, then you're required to follow the default process outlined by Kentucky state law.

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Kentucky Sale and Assignment of a Percentage Ownership Interest in a Limited Liability Company