Understanding LLC Operating Agreements

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hey friends welcome back to the channel running an LLC is not easy and there are so many things I wish I knew before starting mine so for today’s video we are talking about one piece of the LLC puzzle the operating agreement and the easiest way I’ve found to start and manage my LLC if at any point you want to check out a business formation service that can help set up your business for you check out the affiliate link that’s down in the description for Discount that you wouldn’t be able to get anywhere else and where you can find an operating agreement for your llc at no cost to you that being said let’s get into it so what exactly is an LLC operating agreement well think of it as the blueprint for your business it’s a document that spells out all the rules and regulations for how your LLC operates whether you’re a single member LLC or have a group of owners this agreement sets the tone for how things are going to run but do you need one while some states don’t legally require you to have an operating agreement most don’t even need to see that you have one at all but without it you’re leaving yourself open to potential conflicts and legal headaches down the road remember in school when you would have a group project chances are you didn’t all work on the same thing together you would make an agreement although likely verbally of how you would divvy up the work having an operating agreement in place helps protect you and your business by clarifying roles responsibilities and how you handle any conflict that comes up now you may want to do it alone I don’t blame you I I have a single member LLC so I get it the whole too many cooks in the kitchen saying can be a real thing but while you may not have to worry about Partners being an issue there are some other reasons having one is a wise idea for one having an operating agreement can help protect your personal assets by not having one in place your single member LLC could be at risk of being treated more like a sole proprietorship another business structure that doesn’t offer a safety net over your personal belongings so if a lawsuit happens they could be considered fair game but with an operating agreement in place you’re reinforcing that separation between you and your business now another reason to have an operating agreement is Clarity personally if I don’t write it down there’s no way I’m going to remember it even if I think I will having everything spelled out in black and white can help avoid any confusion in the future and give you a physical backing if you ever need to present it so now that we’ve talked a while about what they are what’s actually in them well there are mostly four components every operating agreement should have first there are management and voting rules this section is all about who’s in charge and how decisions get made then comes Capital contributions and distributions aka the money talk this section spells out who’s putting what cash or assets into the LLC and how any profits or losses are going to be divvied up among the members next to last is membership and dissolution practices this section covers how the LLC goes about adding new members or partners and the process if a partner wants to leave the LLC it also spells out what needs to occur if the business itself is ending now last but not least guidelines for how the company should operate remember at the beginning of the video when we described an operating agreement as a blueprint well this section spells out the guidelines of how you want your LLC to operate now just because your LLC has an operating agreement doesn’t mean it can never change nope it’s what we call a living document that means it can and should evolve over time as your business grows and changes maybe new people join the LLC or you decide to try a different profit sharing Arrangement your operating agreement should be updated to show these changes to keep everything on track I know all of this can sound like a lot believe me I’ve been there but you don’t have to do this alone while I was researching things I would need for my LLC I literally cried because when was I going to have time to do all of this after several Google searches and hours of staring at a computer screen I found Taylor Brands Taylor Brands can help you with just about everything ining an LLC including the operating agreement but beyond that their services are not just a oneandone thing they aren’t going to just help you form your LLC and then send you on your way without any support and actually maintaining it they’ll help support your LLC with things like tax support reporting your annual compliance to your state and they can even help with your branding in terms of of marketing they offer a few things to make business life a little bit easier like a free web domain for a year a website design Builder eight free logos a digital business card and tools for creating content for your social media they’ve also begun a print shop so you can get custom merch for your business like t-shirts mugs stickers things to help get your business out there that being said I see Taylor Brands as one of the best business formation Services out there especially for beginners because they take care of everything on your behalf now don’t get me wrong there are other great services that I’ve also tried like Zen business Legal Zoom and Swift filings so I’ll go ahead and leave some review videos down in the description if you want to learn more about them too so what does it cost well right now there are three options Taylor Brands offers that will help you form your LLC they range from self-guided meaning you do all the back work and Taylor Brands just handles your filing to the state to Taylor Brands providing more support for your business if you’re more of a DIY person or you need minimal help on the legal side of things the light plan may be the best fit for you now price-wise this option can’t get any cheaper because well it’s free your only financial obligation would be covering the cost of the state fees in terms of paperwork it all be on you to complete and the processing time for the light plan is 14 days so if you have time to spare and are able to handle it all yourself this could be the right choice for you if you need more support legally but have your branding down packed you can go with the essential plan this includes helping you establish an operating agreement for your LLC handling your annual compliance obligations to make sure your LLC stays legal and when you form your LLC through them they’ll expedite your paperwork to your state within 2 days versus their standard 14-day processing time this plan runs around $200 a year and just as a heads up your State’s filing fee to form your LLC is a separate expense if you’re just starting out and looking for the most support Taylor brands has to offer you can choose the elite plan for around 250 a year this plan gives you everything you get with the essential plan plus their online branding and marketing tools we talked about earlier when I started my LLC I was facing a layoff for my teaching job and essentially starting my tutoring business from scratch from the emotional tool I was going through and the fact that I had no clue what I was doing I needed support with everything so personally I went with the elite plan offered by Taylor brands well I understand it costs more than the essential plan it also comes with a lot more benefits now there’s an unsung feature I haven’t mentioned yet and that is Taylor Brand’s customer service I’m not shy to admit I needed a lot of help getting started I didn’t have any personal connections I could turn to and the whole process was really Greek to me so I really relied on Taylor brands for their expertise every rep I got was helpful in answering all of my questions now I only got support by calling in but they do offer support by email too I wish they had a chat feature or support through text messaging now this is a personal choice one because I don’t really like talking on the phone and two I like having something to fall back on if I don’t have it in black and white it’s too easy to forget something or not positively remember exactly what the rep told me especially if I was calling on something I was planning to do hours later again this is more of a personal choice but I’m sure I’m not the only one who feels that way Beyond getting support with starting your LLC you also can get access to their branding tools it’s been my experience since forming my LLC that the more support I’ve access to the more time I save and headaches I avoid I thought by using free resources online my social media content would look professional and bring new clients in what it really was was a hot mess that looked like it was thrown together using random free templates online having a paid resource gave me access to more unique and uniform content that look professional and made my page feel more put together and that’s going to be it for today’s video I really hope you found this video useful and if you did please hit the like button and subscribe for more and as for those discounts I mentioned at the beginning of the video if you want Taylor Brands to help form your LLC check out the affiliate Link in the description for discounts you wouldn’t be able to find on your own and while you’re there check out my in-depth review of Taylor Brands and along with the discounts and review you’ll also find our link to a free LLC oper opting agreement you can use and customize for your business also feel free to leave any questions in the comments below and I’ll try my best to answer them as soon as I can thanks again so much for watching see you next time

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