LLC Operating Agreement

LLC Operating Agreement

The operating agreement for an LLC (limited liability company) is similar to the bylaws of a corporation. Creating an operating agreement is important to limiting your personal liability for business debts, even if you're the sole owner (“member”) of your LLC. Our form provides everything you need to establish the internal rules of your limited liability company (LLC): type of management, capital contributions, taxes, and more. The form, good for single-member LLCs, multi-member LLCs, and spousal single-member LLCs, also comes with plain-English instructions for understanding and signing the agreement.

You can create, save, and edit the form before you buy—just set up a Nolo.com account. It's easy, free, and there's no obligation to purchase anything. If you buy the form, you'll be able to print, send, or download it at any time during your one-year subscription.

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Your operating agreement is an important part of your LLC formation. Here's why:

  • It helps ensure that courts will respect your personal liability protection by showing that you have been conscientious about organizing your LLC.
  • It sets out rules that govern how profits will be split up, how major business decisions will be made, and the procedures for handling the departure and addition of members.
  • It helps to avert misunderstandings among the owners over finances and management.
  • It allows you to create your own operating rules rather than being governed by the default rules in your state's LLC laws, which might not be to your benefit.
  • It will authorize one or more members of the LLC to deposit and withdraw funds in an LLC bank account, an important first step in starting your new business!

If you haven't formed an LLC yet, the quickest, easiest way to form an LLC is to use Nolo's Online LLC Application.

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