Schedule L-ECON: Limited Liability Entity Tax Computation (for an Economic Development Project) (2025)
Kentucky · Kentucky DOR · Used for tax years 2025
Kentucky Schedule L-ECON computes the Limited Liability Entity Tax (LLET) attributable to an economic development project. It reports the project's Kentucky and total gross receipts, cost of goods sold, gross profits, and resulting LLET.
Who files this form
Taxpayers with one or more economic development projects under any of these programs must complete Schedule L-ECON and include it with their return:
- Kentucky Rural Economic Development Act (KREDA)
- Kentucky Industrial Development Act (KIDA)
- Kentucky Jobs Retention Agreement (KJRA)
- Kentucky Industrial Revitalization Act (KIRA)
- Kentucky Jobs Development Act (KJDA)
- Kentucky Business Investment Program (KBI)
- Kentucky Reinvestment Act (KRA)
- Incentives for Energy-related Business Act (IEBA)
- Farming Operation Networking Project (FON)
The schedule computes the Limited Liability Entity Tax (LLET) attributable to an economic development project. Pass-through entities must also complete Form PTE(K) to determine the income generated by each project.
What you'll need
Have these forms and details available:
- The credit type and project number.
- The name, federal identification number, and Kentucky Corporation/LLET account number, if applicable, for the entity filing the return and the entity claiming the credit, if different.
- Kentucky and total gross receipts attributable to the project, including returns and allowances and applicable statutory reductions.
- Project cost-of-goods-sold amounts and applicable Kentucky statutory reductions.
- Schedule COGS, which the form requires you to attach for cost of goods sold. Section A uses the project portion of Column A, line 8; Section B uses the project portion of Column B, line 8.
- The applicable economic development schedule, where you also enter the LLET result.
Pass-through entities must also complete Form PTE(K).
How to file
Complete Schedule L-ECON and include it with your return. Attach Schedule COGS as directed for the cost-of-goods-sold entries.
Enter the LLET result on the applicable economic development schedule, Part I, line 2 or line 5.
The provided text does not specify a mailing address or e-filing method.
Common mistakes
- Overlooking the $175 rule: If Section B, line 1 or line 3 is $3,000,000 or less, skip Sections C and D. Enter $175 in Section E, line 1 and on the applicable economic development schedule, Part I, line 2 or line 5.
- Claiming disallowed costs: The Section A, line 3(a) instructions say no costs can be claimed for activities other than manufacturing, producing, reselling, retailing, or wholesaling.
- Entering a negative formula result: The results of the formulas on line 1 of Sections C and D cannot be less than zero.
- Leaving off Schedule COGS: The cost-of-goods-sold lines direct you to attach it.
Questions people ask
What does Schedule L-ECON calculate?
It calculates the LLET attributable to an economic development project.
What counts as gross receipts?
Gross receipts include sales, rent, proceeds from sales of real and tangible personal property, interest, and dividends. The instructions say this is not a complete list.
How do Sections A and B differ?
Section A computes Kentucky gross receipts and gross profits attributable to the project. Section B computes total gross receipts and gross profits attributable to the project.
Which amount goes in Section E after completing Sections C and D?
Enter the smaller of Section C, line 3 and Section D, line 3. Also enter that amount on the applicable economic development schedule, Part I, line 2 or line 5.