LLC Answers

You should NEVER sign a business document or other contract on behalf of your LLC as owner.  This is because when you are serving as the person running or managing the business, you are not doing so in your capacity as an owner of the business but rather in your capacity as a manager or officer of the LLC business.

This is an important concept to get if you care about preserving the limitation of liability protection offered by your limitation of liability company.  You never want to do anything that implies that you are doing business in your personal capacity.

One … Continue Reading

This is a tricky question because there is always the interplay between the liability protection afforded to an LLC officer under the limited liability company laws and the general law that requires that you be personally accountable for your actions.

Making decisions in a business is difficult.  You need to decide on things when you may not have complete information and you may make decisions that may ultimately prove to not be the best one.  The law acknowledges this and so generally does not hold … Continue Reading

Once an LLC is formed, the members of that limited liability company will need to select a management structure to govern the LLC.  There are two main structure: (i) member managed and (ii) manager managed.In the great majority of states, the LLC is member managed by default.  This means that if you do not make a choice, the choice is made for you.  In some states, if you want your LLC to be manager managed, you will need to include certain required provisions in the formation documents you file with the state.  So, please look out for these requirements or … Continue Reading

Once your limited liability company is formed and an LLC Operating Agreement is adopted that provides the LLC with members and a governance structure, then what is required for the LLC to start acting like a business?

GENERAL AUTHORIZATION

The limited liability company can only act through its members, managers and/or officers.  The LLC Operating Agreement should provide who has the authority to act on behalf of the limited liability company.  In the more simple member managed LLC structures, the members themselves have the authority to act on behalf of the LLC and are the agents of … Continue Reading