Member-Managed LLCs
In a member-managed LLC, each member has equal rights in management and conduct of activities. Differences among members about matters in the ordinary course are decided by a majority.
Manager-Managed LLCs
To create a manager-managed single-member LLC, appoint a non-member manager. Manager-managed means at least one member is not involved in management.
LLC Operations and Structure
LLCs are governed by contracts, not just laws. An operating agreement outlines structure, rights, and responsibilities of members. LLCs offer liability protection without complexities of corporations and allow pass-through taxation.
Authority in LLCs
Are members of an LLC specifically authorized by statute to bind the LLC? Each member of the LLC has the authority to sign on behalf of the entity as "authorized representatives" by default.
Binding the LLC
What does it mean to bind the LLC? An act of a member binds the company. A Limited Liability Company (LLC) is managed by its members.
LLC Management
An LLC managed by a manager means the members will not be involved in making business decisions for the LLC. If you don’t designate a management structure for your LLC, then it will be member-managed.
Establishing an LLC
There’s more you should know about establishing an LLC, but the basics—why a small business owner should consider it—is your first step. In most cases, you’ll need to follow the rules set by your state’s laws.
Managing Member vs Member
An LLC Managing Member owns the LLC, runs operations, makes decisions, and has the authority to bind the LLC. The main difference is the ability to have passive investors with manager-managed LLCs.
Definition of LLC
Well, an LLC is broadly known as a Limited Liability Company approved by state law. In this type, the personal liability of every owner is limited.