How to Start a Taxi, Limo or Rideshare Business in Kentucky: Motor Carrier Certificate $250, $30 per Vehicle and 13 Certificate Types

If you plan to carry paying passengers in Kentucky, you need a certificate from the Transportation Cabinet's Division of Motor Carriers before you take your first fare. KRS 281.630 requires that certificate for intrastate for-hire passenger transport. This guide walks through how to start a taxi business in Kentucky. The same framework applies to limousine and rideshare operations, and the differences are noted along the way.

Kentucky does not issue a general business license. Forming your company with the Secretary of State is a filing, not a license. The motor carrier certificate is a separate, transport-specific authority, so your startup will involve several agencies: the Secretary of State, the Transportation Cabinet, your county clerk, the Department of Revenue, and your city or county.

This article is informational content, not legal or tax advice. Fees, deadlines and rules change. Confirm every figure with the named agency before you file, and consult a qualified attorney or CPA about your specific situation.

Kentucky Passenger Transport Costs at a Glance

The government fees are modest compared with insurance and vehicle costs. This table lists the state fees covered in this guide.

Item	Amount	Paid to
Motor carrier certificate, application	$250	Transportation Cabinet
Motor carrier certificate, annual renewal	$250	Transportation Cabinet
Annual vehicle license, taxicab, limousine, TNC or disabled persons vehicle	$30 per vehicle	Transportation Cabinet
Property certificate, application and renewal	$25 each	Transportation Cabinet
LLC Articles of Organization (Form KLC)	$40	Secretary of State
Corporation Articles of Incorporation (Form PAI)	$50	Secretary of State
Name reservation (optional, lasts 120 days)	$15	Secretary of State
Certificate of assumed name (DBA)	$20	Secretary of State
Annual report (due June 30)	$15	Secretary of State
Limited Liability Entity Tax	$175 minimum if Kentucky gross receipts or gross profits are $3 million or less	Department of Revenue
Local add-on for taxicabs and limousines	Up to $30 per vehicle per year	City or county

Materials and Information You Need Before You Apply

Gather these items before you start filing. A missing item usually stops the process at the point where you are trying to get the certificate issued.

• A business name that meets Kentucky naming rules and is distinguishable from names already on record with the Secretary of State
• A Kentucky street address for your registered office (post office boxes are not accepted) and a registered agent
• A list of vehicles, with at least one vehicle plated through your county clerk
• A certificate of insurance that meets the KRS 281.655 minimums for your vehicle seating capacity
• Documentation of the vehicle inspection, with the inspection requirements confirmed with the Transportation Cabinet
• Nationwide criminal background check results for every owner and driver
• A business bank account and a payment method for state fees
• The cities and counties where you plan to operate, because local rules differ

Step-by-Step: Starting Your Kentucky Passenger Transport Business

Step 1: Choose the certificate type that fits your service

Kentucky has 13 certificate types under the motor carrier framework. Choosing the right one first keeps your fees and insurance requirements aligned with what you actually run. The types are:

• Taxicab
• Limousine
• Disabled persons vehicle
• Transportation network company (TNC)
• Household goods
• Charter bus
• Bus
• U-Drive-It
• Property
• Driveaway
• Peer-to-peer car sharing
• Automobile utility trailer
• Towing and storage

A taxi company will usually apply for the taxicab certificate. A limousine service applies for the limousine certificate. A rideshare operation running through a platform falls under the TNC certificate, and TNC bulk fees are set in 601 KAR 1:113. If you plan to offer more than one service, confirm with the Division of Motor Carriers whether each certificate type carries its own application fee.

Step 2: Form your business entity with the Secretary of State

Most operators form a limited liability company first, which separates business and personal liability and is the most common structure for small transport companies. File Articles of Organization (Form KLC, Profit Limited Liability Company) for $40. Online filing through the Kentucky One Stop Business Portal at onestop.ky.gov is the fastest path. The Secretary of State publishes no expedited tier or expedited fee, and standard processing is usually the same day received but may take up to three business days. Online filings are effective on the date and time of filing.

Your name must contain “limited liability company,” “limited company,” or the abbreviation “LLC” or “LC.” To abbreviate “limited company,” you must use “LTD CO.” The name must be distinguishable from any name on record (KRS 275.100 and KRS 14A.3-010). Search the Secretary of State's business database at sosbes.sos.ky.gov before you file. If you need time to finalize the name, a name reservation costs $15 and lasts 120 days. If you choose a corporation instead, the Articles of Incorporation (Form PAI, Profit Corporation) cost $50.

Step 3: Appoint a registered agent and registered office

Every entity must continuously maintain a registered office in Kentucky and a registered agent (KRS 14A.4-010). The agent must be either a Kentucky resident individual or a qualified entity, and the agent's business address must be identical to the registered office. The registered office must be a Kentucky street address. Unless the agent signs the formation document, the appointment is not effective until the agent delivers a written statement of acceptance to the Secretary of State. Changing the registered agent or office later costs $10 and is done through FastTrack Online Filings.

Step 4: Register your tax accounts with the Department of Revenue

Register your business tax account with the Department of Revenue using Form 10A100 through MyTaxes.ky.gov. Several taxes apply to passenger operators:

• Limited Liability Entity Tax (LLET): LLCs and corporations owe this tax, with a $175 minimum when Kentucky gross receipts or gross profits are $3 million or less. Kentucky has no franchise tax beyond the LLET.
• Individual income tax: LLC income passes through to members and is taxed at the 3.5% flat individual rate for 2026, with a $3,360 standard deduction.
• Excise tax on passenger receipts: Taxicab, limousine, TNC and rental receipts carry a 6% excise tax effective 1/1/2023 (HB 8, KRS 138.472). You file monthly by the 20th through MyTaxes.
• Sales tax: Kentucky's state rate is 6%, with no local sales taxes, but the tax reaches about 50 services. Ask the Department of Revenue whether any of your charges fall under sales tax.

Set up your monthly excise filing before your first fare. Late filings are the most avoidable cost in this category.

Step 5: Plate your vehicles and secure insurance

Before you apply, at least one vehicle must be plated through the county clerk. Insurance must be on file, and the minimums under KRS 281.655 depend on seating capacity:

• Vehicles with 7 seats: $100,000 per person, $300,000 per accident and $50,000 property damage
• Vehicles with 8 or more seats: $600,000 per accident

Ask your insurer to confirm that the policy meets these figures for each vehicle type you plan to run, and keep the certificate of insurance on file with your application. Coverage quoted for a personal auto policy usually does not satisfy commercial passenger requirements.

Step 6: Complete the vehicle inspection

A vehicle inspection is required before you apply. The inspection standards, the inspecting party and the paperwork the Division of Motor Carriers expects are not set out in this guide, so confirm them directly with the Transportation Cabinet before you schedule the inspection. Inspect every vehicle you plan to list, not just the first one.

Step 7: Run nationwide criminal background checks on owners and drivers

Every owner and driver needs a nationwide criminal background check (KRS 281.6301). The check must be repeated every 3 years. Keep a driver file that records each person's check date so you know when the next one is due. A driver with an expired check should not carry passengers.

Step 8: File the motor carrier certificate application ($250)

Submit your application to the Transportation Cabinet's Division of Motor Carriers with the application fee of $250. Attach or have on file your insurance, plated vehicle information, inspection documentation and background check records. Processing times and submission methods are set by the Division, so check its current instructions before you file. Once issued, the certificate must be renewed every year for another $250.

Step 9: Pay the annual vehicle license for each vehicle

Under KRS 281.631, as amended effective 6/27/2025, annual vehicle license fees are:

• $30 per taxicab, limousine, TNC or disabled persons vehicle
• $100 per bus or charter bus
• $15 per U-Drive-It vehicle
• $10 per property vehicle

Cities and counties may add up to $30 a year per taxicab or limousine on top of the state fee. Budget for both.

Step 10: Check local rules in every city and county you will serve

Kentucky has 120 counties and about 420 cities, and local governments add their own requirements. Cities, counties and school districts levy occupational license taxes on payroll, net profits or gross receipts. Each jurisdiction runs its own forms and revenue office, so check the occupational license tax district for each city and county where your vehicles will operate. Some cities also regulate taxi operations directly. For Louisville or Lexington taxi rules, check with each city. Do not assume a state certificate covers local permits.

Step 11: Build an annual compliance calendar

Your ongoing obligations repeat every year, and several of them carry penalties if you miss them:

• January 1: The annual report filing window opens.
• June 30: Annual report due ($15). Domestic entities that miss June 30 are administratively dissolved.
• Monthly, by the 20th: Excise tax filing through MyTaxes.
• Annually: Motor carrier certificate renewal ($250) and vehicle license payments ($30 per taxicab, limousine, TNC or disabled persons vehicle).
• Every 3 years: Background checks for owners and drivers.
• Continuously: Insurance on file at the required limits.

What Your First-Year Costs May Look Like

Expected results depend on your fleet size, insurance quote and local add-ons, so treat the example below as a rough planning estimate rather than a quote. For a five-vehicle taxi company with an LLC and Kentucky gross receipts under $3 million, state government fees may come to about $630 for a first-year budget, which includes the annual report and the LLET minimum even though neither is paid when you form the LLC:

• LLC Articles of Organization: $40
• Motor carrier certificate application: $250
• Annual vehicle licenses (5 vehicles at $30): $150
• Annual report: $15
• LLET minimum: $175

That total does not include insurance, inspections, background checks, city or county add-ons, a DBA filing, or vehicle and dispatch costs. Insurance is usually the largest expense. Operators who complete every step on this list may be able to begin operating once the certificate is issued, but timing depends on the Division of Motor Carriers and on how quickly your paperwork and inspections are completed.

Common Mistakes to Avoid

• Treating the Secretary of State filing as your operating authority. Forming an LLC does not allow you to carry passengers. You still need the motor carrier certificate.
• Using an incorrect name format. A name without “LLC,” “LC” or the full entity wording, or using an abbreviation other than “LTD CO,” can delay approval.
• Listing a post office box as the registered office. Kentucky requires a street address.
• Buying the wrong insurance. Personal auto coverage and minimum limits that fall below the KRS 281.655 figures will not support your application.
• Missing the June 30 annual report. A missed deadline can lead to administrative dissolution for a domestic entity.
• Filing excise tax late. The 6% excise tax is due monthly by the 20th.
• Letting background checks lapse. The check must be repeated every 3 years for owners and drivers.
• Skipping local rules. A state certificate does not replace city or county licenses, occupational license tax registration or Louisville and Lexington taxi rules.
• Overlooking the 6% sales tax question. Confirm with the Department of Revenue whether any of your charges are taxable.

Practical Tips Before You File

• File online through onestop.ky.gov for your entity formation. Online filings are effective on the date and time you file.
• Reserve your name for $15 if you need time to finish insurance or vehicle planning.
• Set up MyTaxes and your monthly excise filing before your first trip.
• Ask your insurer for a quote that lists the KRS 281.655 limits for each vehicle type.
• Keep a single compliance file with insurance, inspection records, background check dates, fee receipts and filing confirmations.
• Use free help from the Kentucky Small Business Development Center (KSBDC) to review your plan before you spend on vehicles.

Official Resources

• Kentucky Secretary of State, Division of Business Filings: https://www.sos.ky.gov/bus/business-filings/Pages/default.aspx
• Business entity search: https://sosbes.sos.ky.gov/BusSearchNProfile/search.aspx
• Secretary of State fee schedule: https://www.sos.ky.gov/bus/business-filings/Pages/Fees.aspx
• Kentucky One Stop Business Portal (new formations): https://onestop.ky.gov/
• Kentucky Department of Revenue: https://revenue.ky.gov/
• Department of Revenue business registration: https://revenue.ky.gov/Business/Pages/Register-Business.aspx
• Kentucky Small Business Development Center: https://kentuckysbdc.com/
• SBA Kentucky district office: https://www.sba.gov/district/kentucky

The Transportation Cabinet's Division of Motor Carriers administers the certificate and vehicle license. Find its current application forms and inspection instructions through the Transportation Cabinet, since they are not covered by the URLs above.

Final Word

Starting a taxi, limousine or rideshare business in Kentucky comes down to a clear sequence: pick the right certificate type, form your entity, register your taxes, meet the insurance, inspection and background check requirements, file the $250 application, pay the vehicle licenses, and clear local rules. Work through the calendar in Step 11 from the start so renewals and filings never catch you off guard. This article is informational content, not legal or tax advice. Consult a qualified attorney or CPA before you commit to a structure or a fleet.