Key Takeaways

  • Adding a member to a Florida LLC requires reviewing the operating agreement, obtaining approval from current members, and updating official documents.
  • The process may involve amending the Articles of Organization and notifying the IRS if there is a change in ownership percentage.
  • Filing an amended annual report or an Articles of Amendment with the Florida Division of Corporations ensures state compliance.
  • Business licenses, tax filings, and financial agreements must be updated to reflect the new ownership structure.
  • UpCounsel provides access to experienced attorneys to assist with LLC amendments and legal considerations.

Requirements for Making Changes to an LLC

LLC Name Change

There are times when a correction to a name is necessary due to a typographical error or miscommunication. Like the situation where a Certificate of Amendment is necessary to change the name of a business, a Certificate of Correction is filed in the case of correcting a typo to the business name.

Updating Other Documents

Whenever a Certificate of Amendment is filed to change the legal name of the Sunbiz LLC from what it was at the time of the original filing, the name must also be changed on any records or documents. All government records pertaining to the LLC must be updated along with records including:

Fictitious Business Name

An amendment is only necessary to change the LLC's legal name. If the purpose of changing the name is to use it as a trading name, instead of filing an amendment, you would apply a fictitious business name. An LLC has the right to conduct business under a fictitious business name, which is commonly referred to as "doing business as" (DBA). Applying a fictitious business name is an easy and less time-consuming process since no other records need to be changed.

Preparing a Florida LLC Change of Name Form

When preparing a change of name form, the following information is required:

  • The old name of the LLC as it appears in the record for the state
  • The date of filing of the Articles of Incorporation or Organization
  • The document number assigned by the State of Florida
  • The signature of either a member or their authorized representative

Once the form is completed and ready to be filed, the amendment form, a cover sheet, and a check for $25 made payable to the Florida Department of State are then mailed. The paperwork is mailed to the Division of Corporations, Registration Section, P. O. Box 6327, Tallahassee, FL 32314. Once filed directly with the State of Florida, the processing time of the form is approximately two weeks.

Changing Members of a Florida LLC

Internal Change

When changes are made to LLC members or managers, it is usually handled privately without a public filing via the operating agreement for the LLC. Determining who is authorized to make the changes is dependent upon whether the LLC is managed by its members or managers.

When an LLC is member-managed and wants to remove a member, all members including should sign a new operating agreement with a list of the members. It is important that the person being removed sign the new agreement along with the other members. If a new member is being added instead of removed, the new member needs only to sign a new operating agreement that lists all members, including the new one.

Making It Public

It is not required that changes to the members of an LLC be filed with the State of Florida, but the changes must be made public. The changes can be reported by filing either an Articles of Amendment or Amended Annual Report with the Secretary of State.

Reviewing the Operating Agreement

Before adding a new member to a Florida LLC, review the LLC’s operating agreement. This document outlines:

  • Membership admission procedures: Some agreements specify unanimous consent from all existing members, while others allow for a majority vote.
  • Capital contributions: If the new member is making a financial investment, the agreement may outline required contributions and the resulting ownership percentage.
  • Voting rights and management: Changes in membership may alter voting rights and the overall management structure.
  • Profit and loss distribution: New members may impact the existing allocation of profits and losses.

If the LLC does not have an operating agreement, Florida law defaults to the Revised LLC Act, which requires all current members to agree on adding a new member.

Obtaining Consent from Current Members

Once the operating agreement is reviewed, the next step is obtaining consent from existing members. The required approval depends on the LLC’s structure:

  • Single-member LLC: The sole owner has the discretion to add a member without additional approval.
  • Multi-member LLC: Existing members must approve the addition according to the terms of the operating agreement or by unanimous vote if the agreement does not specify.

A written resolution or an amended operating agreement should be prepared to formally document the approval.

Amending the Articles of Organization

Although Florida law does not require an LLC to update its Articles of Organization when adding a member, doing so is beneficial for transparency and official records. If required, follow these steps:

  1. Prepare Articles of Amendment: Include the LLC’s name, document number, and details about the new member.
  2. File with the Florida Division of Corporations: Submit the amendment online or by mail through Sunbiz.
  3. Pay the filing fee: The standard fee is $25.

If the LLC has elected S Corporation status, any ownership changes must be reported to the IRS.

Updating IRS and Tax Information

When adding a member, the LLC’s tax status may be affected, requiring updates with the IRS:

  • Single-member to multi-member LLC: The LLC may need to obtain a new EIN (Employer Identification Number) if it changes from a disregarded entity to a partnership.
  • Ownership percentage changes: If the new member alters the tax classification, file IRS Form 8832 (Entity Classification Election).
  • Florida Department of Revenue: If the LLC is registered for sales tax, employer taxes, or other state taxes, notify the department of any ownership or management changes.

Filing an Amended Report

Follow these steps to file an amended annual report:

1. Visit the Division of Corporations SunBiz website and follow the instructions for filing an annual report.

2. You will need a document number, which can be found on the search page on the Sunbiz website.

3. If you have not filed your current annual report for the year, you can do it while you're on the page and report all the LLC members or managers, including those who were changed. If you've already filed your annual report for the year, you'll be prompted to continue. Follow the instructions. To make any changes, type over the existing text to update the information. Include any information requested, such as the name of the registered agent and your name as the member/manager, and submit.

4. The fee to file an amended annual report is $50 ($138.75 if filing a regular annual report). Processing takes 1 to 5 business days.

Updating Business Licenses and Agreements

Once the LLC member addition is formalized, update all legal and financial records, including:

  • Business licenses and permits: Some industries require updated state and local licenses when ownership changes.
  • Bank accounts and financial agreements: Banks typically require an updated operating agreement and member authorization for account modifications.
  • Contracts and vendor agreements: If the new member has signing authority, update contracts and notify business partners.

Maintaining up-to-date records ensures compliance and smooth operations for the LLC.

Frequently Asked Questions

1. Do I need to file an amendment with the state to add a member to my Florida LLC? No, Florida law does not require you to file an amendment when adding a member, but updating your operating agreement and filing an amended annual report is recommended.

2. Can I add a member to a single-member LLC in Florida? Yes, a single-member LLC can add a member by updating the operating agreement and notifying the IRS if the entity classification changes.

3. Does adding a member to an LLC change its tax structure? It can. A single-member LLC that adds a member becomes a multi-member LLC, which is taxed as a partnership unless it elects S Corporation or C Corporation status.

4. What documents do I need to update when adding a member? You should update the operating agreement, IRS records, business licenses, bank accounts, and vendor agreements to reflect the new member.

5. How long does it take to add a new member to a Florida LLC? The internal process can be completed quickly, but updating records with the state, IRS, and banks may take 1-4 weeks, depending on processing times.

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