single memebr LLC operating agreement?

2 Replies

my attorney and CPA are away for a couple days but im closing on a rental property next week and i want to form my LLC with my state. can my operating agreement be amended after formed? how important are they?

The short answers to your questions...

1. Yes, an operating agreement can be amended after the LLC is formed.

2. The operating agreement can be important or not, depending. It's the founding document for your company and outlines all of the basics for formation, operations and dissolution. However, if you are a single member LLC, then there are no partners to argue with for operations and dissolution, so I'd honestly say that the operating agreement essentially allows you to conduct business for the LLC and open a bank account and that's about it because you aren't really accountable to anybody else. If you've got partners, then the Operating Agreement is absolutely crucial. It is the governing document that will help solve any and all disagreements going forward.

The long answer to your question is simply more questions...  The first one that pops to mind is this...

Why are you just now starting the LLC? Generally, if you're going to title a property in the LLC's name, then it is founded at the time that the buy/sell contract is accepted (preferably before, but at the time it's accepted is the absolute last moment it should be formed as the seller cannot contract with an entity that does not yet exist). If you are hoping to quit claim the property to the LLC after closing, then check the multiple posts here about what can happen at that moment.

Yes you can draft the Operational Manual after you formed the LLC.

OM may be required by your title company for closing if you are purchasing the property under the LLC.