LLC Operating Agreement PA: Everything You Need to Know
An LLC operating agreement in PA establishes how an LLC will be managed and is then agreed upon by the LLC members.3 min read
Pennsylvania LLC Operating Agreement
An LLC operating agreement in PA establishes how an LLC will be managed and is then agreed upon by the LLC members.
An operating agreement is u6m considered a legal document, and can be used by businesses of almost any size. LLC operating agreements can be used to:
- Establish policies
- Develop procedures
- Outline responsibilities of LLC members
An LLC operating agreement is not a legal requirement to run a business in the State. However, without an operating agreement, personal assets of the LLC members are vulnerable should the company be involved with legal action.
You will need to keep of copy of your agreement in your business records, as an operating agreement is considered an internal document.
The main goal of the operating agreement is to name the members of the LLC and to outline what percentage of the corporation each member owns.
When the document is complete, there will be a clear separation of the LLC members/owners and the business itself.
An LLC operating agreement PA also outlines:
- Management of the LLC
- Payment of taxes
- Distribution of profits and losses
The operating agreement should be carefully reviewed before it is signed. LLC members/owners may need to consult a qualified attorney for help writing their LLC operating agreement.
Types of Members
Two types of members can be used when writing your LLC operating agreement.
A multi-member agreement is used when there is more than one contributing or managing member and several aspects of the business need to be established. Every member will be involved when separating the organization from its members.
A single-member agreement is used for a company with a single owner that would like to separate the owner from the business and needs to establish the practices of the business.
How to Form an LLC in Pennsylvania
As required by the Pennsylvania Secretary of State, all business applications must include a unique operating name that could not be mistaken for another business.It is important that you search for your business name in the State database to make sure that it is eligible for use before filing your paperwork.
First, you will need to choose the name for your LLC. Pennsylvania law requires that your name includes the words ‘Company', ‘Limited', or ‘Limited Liability Corporation'. You are allowed to use abbreviations instead of the full words. No examples of acceptable abbreviations are provided, but you should be able to use ‘Co.' or ‘Ltd'.
LLC names must be unique from other business entities in the state. You can check availability of your business name using the State's business name database.
Second, you will need to appoint a registered agent, which is required for LLCs in Pennsylvania. The registered agent of your business is someone who accepts legal documents for your LLC if you are ever sued.
Your registered agent can either be a resident of Pennsylvania or a business entity that has been authorized by the state. An eligible registered agent must have a physical Pennsylvania street address.
Information about commercial registered office providers in Pennsylvania can be found here.
Information you must provide in the certificate includes:
- The name and address of your LLC
- Your registered agent's name and address
- Contact information for every organizer of your LLC
- Information about whether a manager will be used in your LLC
- Information about whether the LLC will provide professional services
You must provide a complete New Entity Docketing Statement with your certificate, In this statement, you should list the name of your LLC, the person designated to handle initial tax reports, and the purpose of your LLC. You should also include its date of formation, the EIN, and the fiscal end date, if applicable. You will need to create an online account when filing online.
Fourth, you need to pay the required fees to the Secretary of State. Domestic fees are $125 and foreign fees are $250.
When you file online, you can pay your fees using a credit card. If you're not filing online, you should submit a check or money order made out to the ‘Department of State' with your application. Applications can be sent to:
Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations, P.O. Box 8722, Harrisburg, PA 17105-8722
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