LLC Operating Agreement (template + instructions)
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- Опубликовано: 14 окт 2024
- LLC Operating Agreement instructions. Follow along step-by-step as I complete an LLC Operating Agreement. Free PDF download you can use for your LLC.
Operating Agreement Download (Word Doc): www.llcunivers...
Operating Agreement Download (PDF):
www.llcunivers...
Operating Agreement Download (Google Docs):
docs.google.co...
Our website: www.llcunivers...
WHAT IS AN LLC OPERATING AGREEMENT?
An Operating Agreement is an agreement for the member(s) of your LLC that sets forth how the LLC will be managed both financially and operationally.
Your Operating Agreement also spells out how much of the LLC each member owns.
You can have 1 member who owns 100%, you can have 2 members with a 50/50 split, 60/40, 70/30 (anything really!), or you can have 3 or more members and you can split the ownership any way you’d like.
The LLC is a flexible business structure. There is no limit on the number of members you can have. And, there are no restrictions on how you split the ownership of the company.
OPERATING AGREEMENT IS AN “INTERNAL DOCUMENT"
Unlike your LLC Formation Documents, the Operating Agreement does not need to be mailed anywhere.
You do not need to mail it to the State.
You do not need to mail it to the IRS.
It is strictly an “internal document”.
This means that you will just keep a copy with your other business documents.
PURPOSE OF THE LLC OPERATING AGREEMENT
Again, the purpose of the Operating Agreement is to spell out who the member(s) are and what percentage of the LLC they own, also known as their “membership interest”.
It also defines how the LLC is managed, how taxes are paid, and how profits and losses are distributed amongst the member(s).
Remember, your LLC can be owned by one person (called a Single-Member LLC) or your LLC can be owned by 2 or more people (called a Multi-Member LLC).
WHAT YOU NEED FOR YOUR LLC OPERATING AGREEMENT
In order to complete your Operating Agreement, you will need some basic information.
• The formation date of your LLC.
• The name and address of the Registered Office and Registered Agent.
• The general business purpose of the LLC.
• Member(s) percentages of ownership.
• Names of the Members and their addresses.
Your final Operating Agreement is not “set in stone”. You can make changes as needed.
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-- MAKING CHANGES TO YOUR LLC OPERATING AGREEMENT --
One of the benefits of forming an LLC is the flexibility of managing your business.
The Operating Agreement is a working document that is meant to be fluid and allow for changes as your business grows.
If you want to make simple changes (such as a change of address for a member or changing your Registered Office or Registered Agent), you’ll need to revise the original Operating Agreement.
If, however, you need to make complex changes (for example one member purchases the interests of another member, or you decide to raise financing with investors), it is best to hire an attorney. Making changes like these can have negative legal and tax consequences if done incorrectly.
Once all changes are made, you’ll need to print the new Operating Agreement and have all of the members sign it.
It is best practice to keep a copy of all versions of your Operating Agreement so you have a history of the changes that were made.
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-- WHO NEEDS YOUR LLC OPERATING AGREEMENT? --
You may need to provide a copy of your Operating Agreement to:
• A lender if you are obtaining financing
• A title company if you are purchasing real estate
• Accounting and tax professionals for financial assistance
• Lawyers for legal advice
• Potential investors or partners who have an interest in your business
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-- OPERATING AGREEMENT PROTECTS YOUR ASSETS --
If you’re involved in a legal battle, the Court will likely ask for your LLC’s Operating Agreement.
Having one can help prove to the Court that you have a legitimate LLC and that you are running your business properly.
If the Courts were to find you running an LLC without an Operating Agreement, they may go after your personal assets.
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-- DISCLAIMER --
This information is provided for educational purposes only and in no way constitutes legal, tax, or financial advice. For legal, tax, or financial advice specific to your business needs, we encourage you to consult with a licensed attorney and/or CPA in your state.
LLC University® is a registered trademark of LLCU Media Group, LLC.
© LLCU Media Group, LLC. All rights reserved.
www.llcunivers...
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Hey folks, make sure to check the site for most up-to-date information: www.llcuniversity.com/operating-agreement/. Or select your state and start forming your LLC with our free guides: www.llcuniversity.com/
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Hi. I want to know that since I'm a non us resident and have an LLC in US, I wouldn't be liable to pay taxes to the us government as long as I don't have someone in the US exclusively working for me(an employee working for me exclusively) Am I assuming it right?..
You saved me over $1000. I went to open a business account and operating agreement was one of the requirements. I am very fortunate to have come across your channel and may God bless your endevours as you continue to be of service to others.
That is so great to hear! Happy we could put the $1,000 back into your pocket for better use ;) Thank you for the kind words, and best wishes to you as well Nectarios!
Do we just keep a copy of it for ourselves or does it have to be registered somewhere ! In state or county or somewhere
@andrew-isac You keep the copy internally for yourself. In some cases a bank may ask for a copy when You're opening a business bank account but this document is internally to how your business is operated, how finances/shares are handled and who the members are.
I'm looking at this video 5 years later and it's still relevant !
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You're very welcome Justin! Thanks for the awesome comment!
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You're very welcome! Happy we could help. If you have any questions you are searching in google, just add "llc university" in your search. We have tons of helpful articles and instructions on our website too. Hope that helps.
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Thank you so much Esayas. I greatly appreciate your comment!
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Hi Vanessa, you're very welcome! So glad we could help :)
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Hi Debra, you're very welcome :) I really appreciate you noticing and the kind words! Let me know if you run into any other questions.
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You're very welcome! Thank you for the lovely comment :)
Thank you for much Sir! for explaining everything Professionally, May God Bless you!
You're very welcome! Glad it was helpful.
Just when I thought I would need to hire someone to develop our LLC Operating Agreement I wan across your channel. Liked and subscribed!
Thanks so much Bob! I appreciate you! Check out our website too (a lot more stuff there). Or just toss "LLC University" into any of your LLC-related Google searches ;) We cover a lot of ground.
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You're welcome Daniel! Thank you :)
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Hi Joanna, your comment means so much!! Thank you, you are very kind. I'm so glad the videos have been so helpful :) I wish you all the best too!
Finally a workable , useable true template with out a fee at the end - thank you for a quick and easy video to follow through with !!!!
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You saved me quite a bit of money and time. This was so simple and straightforward. Thank you so much!
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Hey CC, thanks so much for your awesome comment! You're very welcome :)
Sooooo very detailed, thorough and extremely helpful. You just made this really easy! Thank you!!!!!
You're sooo welcome! Happy to help :)
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You are very welcome Luis! Thanks :)
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Hey Nichole! You're very welcome :) Congrats! So glad we could help!
Thank you so much Matt. Your website and videos have helped me clarify what needs to be done to create an LLC. It's already stressful enough to be opening a business and trying to save money in doing so, but your videos/info/templates are a godsend. Please keep up the good work!!
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You're very welcome Evana! Thank you :)
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You're welcome Scott. Glad we could help :)
Thank yuuuu. I hope it still help 8 years later
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You're very welcome Kris! Thanks!
Just subscribed. I am in process of making an LLC operating agreement…
Thank you for this video.
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You changed my life❤️
Wow! You're kind :)
This Video saved me time,money, and energy! Thank you so much!!
You're very welcome DeVon!
Great Thank you. My Registered agent had a 16 page Operating Agreement and the one you provided was cleaner, short, and sweet. Thank you again!
You're very welcome! Those long ones (while often comprehensive), can be quite overwhelming to go through and understand.
Thanks for posting these videos and thanks for taking the time today to respond to my question by email. Your generosity is much appreciated!
You're very welcome Carol! Thank you for the kind words :)
Thank you so much for making this video and the word doc. I'm a single member and still brand new to business, this was incredibly helpful.
You're very welcome Ruby! So glad we could help :)
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You're very welcome Eli! Thank you for the kind message :)
@@llcuniversity hey I am a single member LLC, just formed a few days ago. For the contribution section, how much will I put for that? That is the only part I didn't get in this video. Thanks for the amazing info 🙏
@@DThornDigital - You can enter whatever you'd like. We recommend putting in enough to get your business started. We have more information here: www.llcuniversity.com/money/llc-capital-contributions/
Thank you so much! Saved me lots of time (and money).
You're very welcome! ;-)
Thank you! With little research (to understand the concept) I was able to create a partnership LLC with IRA and IRA owner and external manager to be compliant with IRS non-prohibited party clause. Your template was barely changed and it worked! I don't know how much exactly I saved cause 3 lawyers have not returned my calls to set one up, oh well, my gain!
Wow, that is impressive! Glad you got it sorted. We hope to have more content on our website in the future regarding LLC/IRAs. Would you be willing to email us the template you created? No worries if you'd rather not. Thanks.
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Awesome! Thanks for the nice compliment Christina :)
Thank you, I wish you an unlimited abundance of prosperity
Oh, heck yes!! Thank you Chrissy! And you're very welcome :)
Tremendously helpful. Thanks again. Couldn’t have done it without you.
You're very welcome Jamie!
This has been extremely useful. I appreciate the step by step process. Really appreciate it.
You're very welcome Rosario!
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You're SUPER welcome Racquel!! Thank you!!
Thank you so much for this video. It really saved me.
You're very welcome Brandon :)
Your video is a life saver. It translates a daunting task to a simple procedures to follow. I'm little unsure about the date to fill in the OA form. If the LLC is formed in the middle of the year, do I fill in the exact date of the LLC formation for all the dates space and still use the calendar year for Tax Year and Accounting Method?
Thanks for the kind words, glad it was helpful! The date at the top should be the effective date (the date the LLC was approved by the state). And yes, you can still use the calendar year for taxes and the cash method for accounting (the most common methods), but you do not have to. If you have questions about these, there are long-form videos on youtube, or you can phone a few accountants. Hope that helps!
Thank you for this, it helped tremendously. Really appreciate you taking the time to do this as well as having a pdf for all to use.
You're very welcome!
this was easy and fast to complete.
Awesome to hear!
Thank u so much, a guy was charging 400 for this...thank u..
You're very welcome Kou!
This was very helpful. You must be a teacher.
Why thank you! Not officially, but I've always enjoyed teaching and communication. Thank you for the kind words :)
Thank you very much for this!!! Saved me a lot and you made it easy to understand.
You are very welcome Michelle! So happy to hear :)
Thank you for this video!!! Clutch!!!👏👏👏
Heck yeah! You're welcome :)
Awesomely done and most helpful. Thank you!
You're super welcome!
Thanks for the step by step what a life saver thanks
You're welcome Rayfus!
THANK YOU FOR SHARING YOUR KNOWLEDGE
You're very welcome Tom. Thanks for the nice comment :)
You are very helpful and a very easy step by step tutorial. You nailed it. My question is when and how do we set up the EIN?
Thank you! You get an EIN for your LLC after your LLC is approved by the state. We have a video on our channel: ruclips.net/video/K0aFWEsnk7Q/видео.html. If you visit our website though (llcuniversity.com/) and choose the state, you'll find far better instructions. Hope that helps!
Wow, thank you so much! This was beyond helpful!
You're very welcome Alley!
I thank you for your information you made it very easy to learn Jose
You're very welcome Jose!
Thank you for make the business life easier. I really appreciate it. I just subscribed to your channel.
Hey! You're very welcome. Happy we can help :)
Thank you so much for such well made and helpful videos, straight to the point and clear to allow, thank you!
You're very welcome Nora :) Thanks for your awesome comment!
Dope information and resources! Thank you so much. New subscriber❤️
Thanks Catavia! You're very welcome :)
Very helpful step by step process. Thanks!
You're welcome Geetha!
Wow!! Thank you very much Matt. You are a genius! Great job! 👍👍
Thank you Julie! You're very welcome :)
Excellent walk through.
Thanks!
forever grateful
You're welcome :)
Hi Matt, thank you so much for this guide, I can’t tell you how helpful it is! If I needed to add a business address to this document, would you recommend just adding a line in the preliminary provisions?
You're very welcome! And yes, certainly, you can stick it anywhere you'd like in the Operating Agreement.
Thank you so much for this. You were thorough and to the point.
You're welcome MH! Glad it was helpful :)
Thank you so much!!!!! You saved me alot of money!!!!!! Thank yo so much!!!!!!
You're very welcome! yay! So awesome to hear :)
This was most helpful. I appreciate your time and effort for sharing this important information and making this a smooth process. Thank you
You are most certainly welcome :) Thank you for the nice comment!
Thank you so much for this helpful information. I wasn't sure how I was going to write this and I found your channel!!!!
You're very welcome! Feel free to stop by our site. We have a lot more resources there :) www.llcuniversity.com/learning-center/
Thank you for this information . It's what I needed.
Glad it was helpful Linda!
Thank you! Very helpful video. Appreciate your time
You're very welcome Chad :)
I like your video too, make it simple, I’m recently frustrated about the operating agreement buy sell provisions
Thanks Yali, glad it was helpful.
You guys killed it. Thank you thank you!
Heck yea!! Thanks again Christina, you rock!
Thanks so much for all the helpful information! Question... Can someone select the "accrual" method of accounting instead of "cash?" If so, what are the benefits of using the "cash" method vs. "accrual" for accounting treatment?
You're welcome Eduard. Yes, you can certainly make any changes you need. The cash method is just more common in the context of small business owners. Too long of an answer to spell out here, but check out this video: ruclips.net/video/KcTZdXpaVOU/видео.html
Should the font on the entries be left as bold? Perhaps makes it easier to identify the information on the document. Or is this only for illustration purposes of the video? It looks kind of funny to leave it in bold. Or perhaps it doesn't even matter since its mostly an internal document 🤔. Great informative video!
It's totally up to you. It can be bold or regular :) Thanks!
THIS WAS A HUGE HELP! THANK YOU!!!
You're very welcome Markia! :)
Thank you so much for making these instruction videos!
You're very welcome!
This is very helpful Thank you so much!
You're very welcome!
Great video, thank you very much! How would I add a Living Trust into Operating Agreement? Meaning if something happens to me, sole proprietorship, then I want to make sure it goes through my Living Trust.
Also if the LLC is for rental property, then what do you suggest I put in for "contribution", the property value?
Hey Loc, while you can contribute property in exchange for LLC Membership Interest, you'll want to check with an accountant on that. And for estate planning, if you form a Trust, you can then assign/transfer 100% of your LLC Membership Interest from yourself to your Trust. Said another way, the Trust becomes the 100% LLC Member.
Wow! Thank you so much for this!
You're very welcome Vickie!
This was exactly what I was looking for and in need of so thank you!
Awesome! You're very welcome :)
Thank you so much for putting these videos out there!
You're very welcome Christian!
Thank you soo much for this video. I was literally about to pull my hair out till I ran into this video
Hi Astan, you're very welcome! If you have any other questions, just throw "llc university" into your google searches :)
Hey! I had a quick question. For section 4 the registered office and agent - is it fine to just use yourself and your home address? We're registering a media company so it's mostly online and don't have a real address to use besides home. Also do I need to include and phone number or email or anything else in this section? thanks so much for the video and template!! its really helpful
Yes, you can list yourself. And no, no phone number or email is needed (but you can certainly add it if you want). And you're very welcome!
Super helpful, thank you! Do you have a template to amend the OA to add another member and change the llc’s name/purpose?
You're welcome. Apologies, but not at this time.
Thank you so much for explaining this!
You're very welcome Tatum!
Seriously thank you!
You're very welcome!
very helpful... blessings
You're welcome!
First, this is an awesome video and it was helpful for me and my clients.
I understand that, if I or someone, were to fill out this document as you have directed in the video, it would constitute the consent to make the needed edits and use the document as needed. Is that a correct understanding?
Hi Matt, you're very welcome. Are you referring to completing this document for someone other than yourself? If so, then no, there is no consent. It's not a good idea for someone to let someone else complete their LLC's Operating Agreement. Hope that helps.
Hi Matt thanks so much for all the detailed information!! I really appreciate your work and efforts. I‘ve just opened my LLC in Florida. But I want to change the name now. I know I can do it on my own but not sure about. I already have the amendment form which will I file but not sure if I need to do something else? Like in a Federal level? Could you help me out? As I didn’t find any video talking about this! Thanks so so much once again! Pat
Hi Patricia, you're very welcome. How long has the LLC been in existence? Here's info on how to change the LLC name with the IRS: www.llcuniversity.com/irs/llc-name-change/. You'll also want to update your bank and any other place that you've registered the LLC name with. Hope that helps.
This was great information. Filled mine out. Thank You all so much for the info.
You're very welcome Joel!