How to Write an Operating Agreement for a Single-Member LLC

Draft an operating agreement for your single-member LLC to formalize structure, protect liability shield, and clarify operations.

  1. Define basic entity information and member details. Document your LLC's legal name, formation state, registered agent, and business address. Include your name as the sole member, ownership percentage (100%), and your capital contribution amount. Specify the LLC's business purpose and management structure—single-member LLCs are typically member-managed.
  2. Establish capital contributions and ownership records. Record your initial capital contribution—cash, property, or services contributed to start the LLC. Assign this a dollar value for your books. Document how additional capital contributions will be handled and valued. Include provisions for maintaining a capital account that tracks your investment basis.
  3. Set distribution and allocation procedures. Define how profits and losses flow to you as the sole member—typically 100% since you own the entire LLC. Establish when and how you'll take distributions, whether regular draws or periodic distributions. Include language about maintaining adequate working capital before taking distributions.
  4. Document management authority and decision-making. Specify your authority as the sole member to bind the LLC, enter contracts, hire employees, and make business decisions. Include procedures for major decisions like taking on debt exceeding a threshold (e.g., $25,000) or selling substantial assets. Document signature authority and banking resolutions.
  5. Include record-keeping and meeting requirements. Establish requirements for maintaining corporate formalities—annual meetings with yourself, written resolutions for major decisions, and separate books and records. Document where records will be kept and retention periods. Include procedures for amending the operating agreement.
  6. Address dissolution and succession planning. Define triggers for LLC dissolution and wind-up procedures. Include succession provisions—what happens if you become incapacitated or die. Specify how assets will be distributed and debts settled. Consider naming a successor manager or defining how one will be appointed.