LLC Operating Agreement (12 Pages)

This Form is an Operating Agreement for a Limited Liability Company (LLC). It is probably most useful in the context of a family-owned LLC. It is structured as a Manager- Managed LLC, i.e. the Members appoint a Manager who is then charged with the management responsibilities for the entity. Another alternative would be a Member-Managed LLC in which all of the Members share the responsibilities of management.

It is important to respect the capital accounts of the Members, especially in a family LLC situation where gifts to younger generation members are involved. Note Articles V and VI which address the capital accounts.

This Form addresses a number of issues that typically arise in structuring an LLC, namely: death, disability, expulsion, bankruptcy, resignation, sale and transfers of LLC interests. The Form provides that if a third party is allowed to purchase an interest in the LLC from a Member, the unanimous consent of the remaining Members is required to allow the purchaser to become a Member, notwithstanding the fact that the purchaser acquired an economic interest in the LLC.

Author:
Steven G. Siegel is president of The Siegel Group, a Morristown, New Jersey - based national consulting firm specializing in tax consulting, estate planning and advising family business owners and entrepreneurs. Mr. Siegel holds a BS from Georgetown University, a JD from Harvard Law School and an LLM in Taxation from New York University.

He is the author of several books, including: Planning for An Aging Population; Business Entities: Start to Finish; Taxation of Divorce and Separation; Income Taxation of Estates and Trusts, Preparing the Audit-Proof Federal Estate Tax Return, Putting It Together: Planning Estates for $5 million and Less, Family Business Succession Planning, Business Acquisitions: Representing Buyers and Sellers in the Sale of a Business; Dynasty Trusts; Planning with Intentionally-Defective Grantor Trusts; The Federal Gift Tax: A Comprehensive Analysis; Charitable Remainder Trusts, Grantor Trust Planning: QPRTs, GRATs and SCINs, The Estate Planning Course, The Retirement Planning Course, Retirement Distributions: Estate and Tax Planning Strategies; The Estate Administration Course, Tax Strategies for Closely-Held Businesses, and Tort Litigation Settlements: Tax and Financial Issues.

Mr. Siegel has lectured extensively throughout the United States on tax, business and estate planning topics on behalf of numerous organizations, including National Law Foundation, AICPA, CCH, National Tax Institute, National Society of Accountants, and many others.  He has served as an adjunct professor of law at Seton Hall and Rutgers University law schools.
The Siegel Group provides consulting services to accountants, attorneys, financial planners and life insurance professionals to assist them with the tax, estate and business planning and compliance issues confronting their clients. Based in Morristown, New Jersey, the Group has provided services throughout the United States. The Siegel Group does not sell any products. It is an entirely fee-based organization. Contact the Siegel Group through its president, Steven G. Siegel, e-mail: [email protected].