Question:

Should a single owner of an LLC create an operating agreement?

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I am about to start an LLC and I was wondering if I should form an operating agreement? This will help me decide whether to go with legalzoom, or do it myself. Legalzoom also provides a company seal and ownership certificates. I will most likely keep this business to myself and take on no partners. Any help is much appreciated. I am in Delaware and this is the last step to help decide what I should do. Thanks.

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  1. Operating agreements are not necessary for single member LLCs. Creating the LLC is not difficult so it isn't necessary to go to Legalzoom, although I would never discourage someone from getting help from an accountant or attorney if it would make you feel more comfortable.

    You should however have a Business Plan. Check out the Small Business Administration's website www.sba.gov to find basic information on writing a plan.


  2. If you decide to take on a partner in the future, you will have to re-file for a partnership. The operating agreement is not necessary in the case of a sole propriety. Also, the operating agreement will more so stipulate the functions/services you will provide under your LLC and does not directly affect your starting up. You can start without an operating agreement and outsource or hire consultants if need be, in which case a different agreement would be necessary. Otherwise you should be fine without it for now as a sole proprietor.

  3. if you're the only member, no operating agreement is necessary.

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