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    An LLC (limited liability company) should always create an Operating Agreement. The LLC Operating Agreement governs the operation and management of the LLC and defines that basic rights and responsibilities of LLC members.

    The Operating Agreement is the most important document for your LLC. It is the core document that is referred to when issues concerning the LLC and its members need to be resolved. Without the formality of an agreement, the basic operation of the LLC would be governed by state law, which may not be advantageous to the LLC, it members, or the business it conducts. In fact, some states like New York require an LLC to have an operating agreement.

    It is also important that you create an LLC Operating Agreement to separate yourself as an individual from your LLC, even if you are the sole owner (“member”) of your LLC. Without the formality of an agreement, the LLC can closely resemble a sole proprietorship, which does not limit your personal liability for business debts of the LLC.

    In addition, many lenders such as banks will request the LLC Operating Agreement to obtain financing. Create your law firm quality customized LLC Operating Agreement in 3 easy steps! Get started for free and pay only if you are satisfied.

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