Note – this worksheet does not constitute legal advice or direction – it is to be used in preparation for a discussion about your operating agreement with a legal advisor.
An LLC (limited liability company) operating agreement allows you to structure your financial and working relationships with your co-owners in a way that suits your business needs and, often, your family needs.
An operating agreement will help to protect your limited liability status, decrease the likelihood of misunderstandings regarding the financial, business and human resource management of your company. It will also provide you and your partners or family members with a foundation for discussion when issues arise. Finally, it is a very important legal document that is required in some states and key to sound business management practices. Remember, in electing to be an LLC, you are taking steps to ensure that the courts will respect your limited personal liability. An operating agreement is an important part of formalizing that structure and adding to your personal protection.