A Limited Liability Company (LLC) is a popular business structure that combines the benefits of both corporations and partnerships. LLCs provide personal asset protection for business owners while also allowing for more flexible management and tax benefits.
However, forming an LLC requires more than just filing articles of organization with your state government. LLC owners must also establish an operating agreement to specify ownership rights, distribution of profits and losses, decision-making processes, and various other details related to their business.
While it`s possible to hire a lawyer to draft an LLC operating agreement, this can be costly, especially for small business owners. Fortunately, there are free templates available online that can help LLC owners create their own operating agreement.
One such template is available from the Small Business Administration (SBA), which provides a free operating agreement template specific to LLCs on its website. This template includes standard provisions for LLCs, such as the purpose of the business, the amount of capital each member will contribute, and how profits and losses will be distributed.
Another option is to use a free LLC operating agreement template provided by an online legal service, such as LegalZoom or Rocket Lawyer. These templates may offer more customization options, but may require a membership or subscription to access.
When using a free template, it`s important to ensure that it meets your specific business needs and that all necessary provisions are included. It`s recommended to consult with a lawyer before finalizing your operating agreement to ensure its legality and to address any unique concerns or considerations for your business.
In summary, forming an LLC requires more than just registration with your state government. Creating an operating agreement is an essential step in establishing ownership rights and outlining key details related to your business. While hiring a lawyer can be costly, there are free templates available online that can help LLC owners create their own operating agreement. It`s important to ensure that any chosen template meets your specific business needs and to consult with a lawyer before finalizing the agreement.