Do I need an operating agreement for my Florida LLC?

There are many different structures that a business can take. For business owners across Florida, a Limited Liability Company (LLC) is a popular choice. This structure shields owners from personal liability should legal disputes occur.

One question that often crops up is whether or not an LLC in Florida requires an operating agreement. An operating agreement is a legal document that outlines the rights and obligations of LLC members.

So, do you need an operating agreement?

It is not a legal requirement, but is still beneficial

It is not mandatory for LLCs in Florida to have operating agreements. Nonetheless, this does not mean that companies should not implement them. An operating agreement can be highly beneficial for the following reasons:

• Protecting the status of your company: Without an operating agreement, it can be unclear who owns what and which assets are personal and company owned. An operating agreement can clarify this. By utilizing an operating agreement to clarify asset ownership, your company can gain tax advantages and protect its status as an LLC.
• Higher efficiency: Documents like operating agreements can set the foundations for how your company is run day-to-day. They can outline the management rules and functions of the company. This makes business operations more efficient.
• Protection from default rules: Without an operating agreement, disputes may be settled via default rules stemming from the Florida Revised Limited Liability Company Act. Default rules are not necessarily going to be in your favor, so an operating agreement that meets the requirements of your business through its provisions can be better.

To get the most out of an operating agreement, it needs to be drafted properly. We help businesses draft important legal documents, contact us today for a consultation.