While low-maintenance, LLCs do require a minimal degree of annual upkeep. Doing so is quite easy compared to more complicated business entities like corporations. Here are all of the important points you’ll need to know when maintaining your LLC’s standing in your state:

What are the Obligations, Annual Requirements and Fees of an LLC?

LLCs are required to perform a minimal amount of annual maintenance, making them be an attractive prospect for any start-up or small business owner. Unlike corporations, LLCs are not legally required to hold the amount of regular meetings and file the same amount of paperwork that corporations do. For instance, an LLC is required to hold an annual meeting with corresponding “meeting notes,” which can technically be a meeting held by yourself! An annual filing with the Secretary of State is all you’ll need to mark on your calendar.

Depending on the business you’ll be running, some additional costs may be incurred, such as local licenses (such as those for construction contractors or bar owners) – however, those will be necessary, no matter which type of business you’re registering.

Do LLCs Have Ongoing Maintenance Fees?

Unlike other business protections like maintaining a trademark (and keeping up with their 5 and 10 year fees), LLCs do not have any ongoing maintenance fees.

Creating an Operating Agreement

Drafting an operating agreement is a good idea, especially if your LLC includes co-owners or officers. This document outlines how the company will be run, and states the rights, responsibilities, managerial rights and duties of your company’s members. Depending on which US state you reside it, the operating agreement may be a necessity. Without one, your LLC is governed by state default rules that have been pre-determined by court decisions.

In situations where the LLC only includes you, the operating agreement states the purpose and framework that you intend your business to follow. It can be used in court as documentation that proves a separation in entity from you and your business.

When an LLC includes yourself and other members, the operating agreement should include a detailed explanation of each member’s rights and powers within the company. Be sure to include account information, profit distribution, percentage of interests in the LLC, voting powers, meeting and voting rules and other provisions you deem necessary.

General LLC Record-Keeping

Having an organized way of life is vital for the LLC owner. You’ll need to save important documents, including all correspondence with banks and other financial institutions, stock certificates, ledgers, meeting notes, and all copies of paperwork that were filed to create the LLC in the first place. Throughout your company’s life span, you may need to reference these documents, while you make important decisions that affect the future of your LLC.

Where to Go Next: LLC Banking | LLC Accounting | LLC Taxation