Articles of organization must be filed with the appropriate state to form an LLC. While an operating agreement does not have to be filed, it is an important document that should set forth the members’ rights and responsibilities, their share of ownership, their voting rights, their shares of profits and losses and their distribution rights, all of which can be different and without regard to their capital contribution. One or more managers make management decisions and “run the business” for the inactive members. As its name implies, an LLC provides the same limited liability for its members as does a corporation. Members enjoy limited liability for the debts, obligations and liabilities incurred by the business as well as liability stemming from possible legal action...
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