Key Takeaways

  • The owner of an LLC is called a “member,” regardless of whether the LLC has one or multiple members.
  • Members can choose from a wide variety of titles, such as Managing Member, Principal, or CEO, depending on their role and how they want to present the business.
  • Certain titles, like "partner" or "proprietor," can imply personal liability and are best avoided.
  • LLCs can be managed by members or managers—understanding the distinction is key for structure and taxes.
  • Titles can impact how your business is perceived by banks, clients, and government agencies, so choose wisely.
  • You can always seek help from an attorney on UpCounsel to determine the best title for your LLC role.

What are the owners of an LLC called? The owners of an LLC are called its members. Depending upon the size of the organization, an LLC member can assume a position resembling a partner, passive investor, or a sole proprietor.

Some of the names that members of an LLC can take up include the following:

  • Sole Proprietor: The IRS considers the owner of a one-member LLC as a sole proprietor. Despite protection of their personal assets against the debts of the company, a single-member LLC owner must be responsible for all functions of the LLC. They cannot draw salary since the business profits are considered personal income and are subject to self-employment taxes.
  • Partners: All LLCs with more than one member are treated as partnerships for the purpose of federal taxes. Any profit or loss arising from the business is divided among the partners in proportion to their personal investment and level of involvement in business activities.
  • Member Managers: According to the IRS, any individual with the authority to make decisions with regards to the management of the business can be termed as a member manager. The IRS requires a member manager to sign the informational return in Form 1065. If an LLC does not assign a member manager, the IRS considers all the owners as member managers.
  • Passive Members: A passive member's involvement in an LLC is only by virtue of their initial investment. Passive members have no rights whatsoever over the management or the general operating procedures of an LLC. A passive member's share of profit is free from self-employment taxes.

The fact that one is not bound by hard and fast rules when it comes to naming the various positions of responsibilities in an LLC works to its advantage, especially in the case of startups where the entrepreneurs would prefer keeping a low-key title rather than high-sounding corporate terms like CEO and president.

Preferable Titles for LLCs

The primary purpose of any official title is to convey the exact nature of your job and responsibilities. Accordingly, your title should reflect your authority and the decision-making power that you yield. In addition to this, your title should not be misleading or confusing. If there are only a few members in an LLC, the title of owner would be enough to clarify your position. Similarly, terms like principal, managing member, and president leave no space for assumption when it comes to the exact role of an individual in an LLC setup.

How to Choose the Right LLC Owner Title

Choosing the right title as an LLC owner goes beyond personal preference—it can influence how others interact with your business, from banks to potential clients.

Here are several considerations when selecting a title:

  • Legal Clarity: Titles like “Owner” or “Member” accurately reflect your position and are widely understood in legal and governmental contexts.
  • Business Perception: If you want to convey a more corporate structure, titles like “CEO,” “President,” or “Managing Member” may offer a stronger impression to stakeholders.
  • Functional Accuracy: Choose a title that aligns with your daily responsibilities. For instance, “Operations Director” suits someone overseeing day-to-day logistics.
  • External Interactions: Some banks and government agencies may require documentation listing your official role in the LLC. A clear, recognizable title can prevent confusion or delays.

Ultimately, your title should align with your level of authority and the image you want to project, while remaining compliant with state regulations.

Titles That Are Better Avoided

Some of the titles prevalent in today's LLC structure are such that you should better avoid them in order to aid clarity and get rid of redundant titles that do not make sense.

  • Managing Partner: Managing partner, or for that matter any title with partner, should be a no go as far as titles in LLCs are concerned. The term partner suggests that you are liable for any mishaps in the operational procedure of the LLC even if you are not a party to the decision that led to it.
  • Proprietor: This is yet another popular title in the market today. Just like the term partner, the title of proprietor does not provide any protection from liability.
  • Some fun titles popular among millennial startups may be attractive to a certain demographic but may hamper a pan-demographic appeal. You should avoid them, too.

Legal and Practical Impacts of LLC Titles

Certain titles might seem appealing but carry unintended consequences. Here’s why the wrong title can cause problems:

  • Liability Confusion: Titles like “Partner” or “Sole Proprietor” may imply unlimited personal liability, even when LLCs are meant to offer liability protection.
  • Misrepresentation Risks: Using corporate titles like “President” or “Director” when not appropriate under your LLC structure might mislead investors or government agencies.
  • Banking and Legal Interactions: Banks may reject documents or loan applications if titles don’t clearly show authority to act on behalf of the LLC.

To minimize confusion and protect your liability status, it's best to use titles that reflect your actual position and match the LLC’s operating agreement or formation documents.

LLC Members Versus Member Managers

Anybody with an ownership interest in an LLC is a member. Unless specifically mentioned, all the members of the LLC have an active role to play in the business operations of the business. In some cases, one or more members are designated to oversee the operations. These members are then referred to as managing members.

Member-Managed vs. Manager-Managed LLCs

An LLC can be managed in two ways, which directly affects the responsibilities and titles of its owners:

  • Member-Managed LLC: All members are involved in daily operations and decision-making. Common titles include:
    • Member
    • Managing Member
    • Co-Owner
  • Manager-Managed LLC: Members designate one or more managers (who may or may not be members) to handle operations. Common titles in this structure include:
    • Manager
    • CEO (if designated with executive authority)
    • Non-Managing Member (for passive investors)

This distinction should be clearly outlined in your operating agreement, as it affects tax filings and control rights.

Some More LLC Titles

  • Shareholders hold shares of the LLC but have limited rights when compared to a member.
  • You may appoint corporate officers such as vice president and treasurer, but their power would be determined by the members.
  • Registered agents are usually a third-party appointed to handle official governmental documents on behalf of the LLC.

Creative but Appropriate LLC Title Options

LLC owners have the flexibility to use unique titles that reflect their business culture—as long as they remain clear and professional. Consider the following:

  • Principal: A formal title that works well for consultants or service providers.
  • Founder: Common in startups; can be paired with another title like “Managing Member” for clarity.
  • Director of [Function]: For example, “Director of Marketing” or “Director of Finance” to clarify departmental oversight.
  • Creative Titles: Terms like “Visionary Officer” or “Chief Strategist” may suit modern startups but should be balanced with more traditional alternatives on legal paperwork.

Regardless of creativity, always ensure your title:

  • Accurately reflects your role
  • Doesn’t imply authority you don’t have
  • Is recognized by banks, clients, and regulatory agencies

Frequently Asked Questions

  1. What is the owner of an LLC called?
    The owner of an LLC is called a "member." If the LLC has multiple members, all are co-owners and may assume specific managerial titles.
  2. Can I call myself the CEO of an LLC?
    Yes, you can use the title CEO if it aligns with your role and responsibilities. However, ensure it's recognized in your LLC's operating agreement to avoid confusion.
  3. What title should a single-member LLC owner use?
    Common titles include "Owner," "Sole Member," or "Managing Member." The best choice depends on how formal you want your business to appear.
  4. Do LLC owner titles need to be registered with the state?
    Usually, titles don’t need to be registered, but they should be documented in your LLC's operating agreement and used consistently in official dealings.
  5. What titles are best avoided for LLC owners?
    Avoid titles like "Partner" or "Proprietor" as they may suggest personal liability or misrepresent the LLC’s structure.

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