Key Takeaways

  • LLCs require several foundational documents, including Articles of Organization, Operating Agreements, and an EIN.
  • Understanding how to draft a contract is critical when creating or updating LLC documents, ensuring legal clarity and enforceability.
  • Good contract drafting involves clear language, defined terms, mutual obligations, and legal compliance.
  • Important additional LLC documents include resolutions, membership certificates, and meeting minutes.
  • Knowing where and how to file or store these documents can affect your LLC’s compliance and smooth operation.

Entity documents for an LLC are the documents required by a state to register a limited liability company (LLC) to conduct business legally in that state. The same documents are required by most states, but they sometimes go by different names.

What Is an LLC?

LLCs are one of the most popular structures for businesses in the U.S. today. They provide liability protection for the owners, also called members, of the company. LLCs also offer pass-through taxation, which means that they avoid the double taxation that corporations are known for.

Other advantages of an LLC include:

  • Fewer regulations for profit distribution.
  • Flexibility concerning the management and overall structure of the company.
  • Fewer requirements from the state.
  • Lower costs for formation and upkeep.

Formation Documents for an LLC

Once a business owner has filed to start an LLC, they'll get a Certificate of Formation that will include the LLC's articles of incorporation, or articles of organization. These documents can sometimes go by different names in different states, but they are essentially the same thing.

Articles of organization should include basic information about the LLC:

  • Names of the members.
  • Address of the business.
  • Registered agent information.
  • Purpose or mission of the LLC.
  • Duration of the LLC (if not perpetual).

No matter which state an LLC is formed in, it cannot have the same name of another business registered in that same state. The best way to avoid this issue is to perform an LLC name search through the SOS (Secretary of State) website of the state in which you hope to register. There are other rules regarding naming an LLC that vary from state to state, so it's always a good idea to look up the rules for business names in the state.

A registered agent for an LLC is a person who accepts official correspondence on behalf of the business. This is mostly to make sure that there is always a representative available to accept service of process for the company. Registered agents can be hired or can be a member or friend of a member of the LLC.

LLC Operating Agreement

Operating agreements are similar to partnership agreements, but they are meant for LLCs. An operating agreement should outline how the LLC is meant to be operated and how it will handle certain issues. Specific issues that should be covered in an LLC operating agreement include:

  • Management structure.
  • Voting rights.
  • Profit distribution practices.
  • Adding a new member.
  • Dissolution of the LLC.

Each state provides its own blanket operating agreement for all LLCs formed in the state. If an LLC doesn't have their own operating agreement, they are required to follow the rules of the state by default. Very few states require LLCs to form and file their own operating agreements.

While operating agreements are rarely required, they are beneficial to LLCs because they get all of the members on the same page at the start of the business. If a dispute comes up between members down the road, they can refer back to the operating agreement to help settle it. A well-written operating agreement will help its LLC avoid legal issues and costly disputes.

How to Draft a Contract for Your LLC

Drafting a well-structured contract is a cornerstone of running a compliant and protected LLC. Knowing how to draft a contract ensures your agreements with members, vendors, clients, or partners are enforceable and clear. Here’s what to consider when preparing any LLC-related contract:

  • Define the Purpose Clearly: Specify the reason for the contract and the expectations of all parties.
  • Identify All Parties Correctly: Include full legal names, roles, and capacities (for example, LLC member, managing member, or external contractor).
  • Specify Key Terms and Deliverables: Detail the services or goods to be provided, timelines, payment terms, and performance standards.
  • Include Legal Considerations: Address confidentiality, dispute resolution methods, applicable law, and termination clauses.
  • Ensure Mutual Consent: Confirm that all parties voluntarily agree to the terms, providing their signatures or e-signatures.

Using clear, concise language and avoiding legal jargon where possible will improve understanding. Remember, drafting contracts isn’t just about writing agreements — it’s about creating legally binding documents that protect your LLC’s interests.

If you’re unsure how to draft a contract or need help tailoring one to your LLC’s needs, consider consulting a qualified attorney. You can find experienced legal professionals on UpCounsel.

Employer Identification Number

An EIN (employer identification number) is like a Social Security number for a business. This number is used on tax forms and to get a business bank account. EINs are obtained through the IRS (Internal Revenue Service). Not all LLCs hire employees, but if they do, they must have an EIN.

Additional LLC Documents You Should Prepare

Beyond the basic documents, several other entity records strengthen an LLC’s legal foundation:

  • LLC Resolutions: These formalize decisions made by the members or managers, such as approving loans or major purchases.
  • Membership Certificates: While not always legally required, these provide evidence of each member’s ownership interest.
  • Meeting Minutes: Recording key decisions from member or manager meetings can provide clarity and a paper trail if disputes arise.
  • Amendments to Articles or Operating Agreements: Whenever there’s a material change (like adding a new member or changing the business name), you should draft formal amendments and file them if required by state law.

Each document should be drafted with care, following best practices on how to draft a contract to ensure they are enforceable and aligned with the LLC’s operating structure.

Where to File LLC Documents

Articles of organization for an LLC are always filed with the SOS for the state in which the LLC hopes to conduct business legally, whether as a foreign or domestic entity. If an LLC does business in different states, it needs to choose one state to be its home and then file as a foreign LLC in the other states. Typically, the domestic state for the LLC should be where the business's physical address is found and the registered agent does business.

If an LLC is required to file their operating agreement, that will also be done with the SOS. Otherwise, the operating agreement should simply be kept in a safe place at the office of the LLC. Certain licenses may be required for a particular type of LLC; this information is also found through the SOS.

Storing and Maintaining LLC Contracts and Records

After drafting and executing your LLC contracts and entity documents, you must ensure they’re properly stored and maintained. Best practices include:

  • Create a Central Record System: Maintain a secure, organized filing system (physical or digital) for all contracts and LLC records.
  • Set Review Dates: Regularly review contracts and key documents to ensure they’re still relevant and compliant with current laws.
  • Use Contract Management Tools: Digital tools can help track deadlines, renewals, and obligations.
  • Ensure Access Control: Limit access to sensitive contracts to authorized members or managers only.
  • Comply With Retention Requirements: Follow state and federal guidelines on how long to retain specific records.

Maintaining your LLC documents correctly is just as important as knowing how to draft a contract, ensuring your company stays protected and avoids compliance pitfalls.

Frequently Asked Questions

  1. What is the most important document when starting an LLC?
    The Articles of Organization (or equivalent formation document) are the key documents needed to officially form your LLC with the state.
  2. Do I need a lawyer to draft an LLC contract?
    While you can draft basic contracts yourself, complex agreements or those with significant financial or legal implications should be reviewed by an attorney.
  3. How can I ensure my contract is legally enforceable?
    Ensure it includes clear terms, mutual agreement, consideration (exchange of value), and complies with applicable laws. All parties should sign the contract.
  4. Are operating agreements mandatory for an LLC?
    Not always, but they’re highly recommended because they outline ownership, management, and dispute resolution procedures.
  5. Where should I store LLC contracts and documents?
    Keep them in a secure, organized location (physical or digital), with backups, and restrict access to authorized individuals only.

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