LLC Minutes Requirements

By Salvatore Jackson

One of the major benefits for a small business owner in choosing to form a limited liability company, or LLC, over a corporation is that maintaining the formalities for an LLC is a simpler process. If the owners of a corporation or LLC do not maintain legal formalities, a creditor may be able to pierce the corporate veil and hold the business owners personally responsible for business debts. Unlike a corporation, however, an LLC is not required to hold annual meetings.

One of the major benefits for a small business owner in choosing to form a limited liability company, or LLC, over a corporation is that maintaining the formalities for an LLC is a simpler process. If the owners of a corporation or LLC do not maintain legal formalities, a creditor may be able to pierce the corporate veil and hold the business owners personally responsible for business debts. Unlike a corporation, however, an LLC is not required to hold annual meetings.

LLC Annual Meetings

LLC owners, called members, are not required by state LLC statutes to hold an annual meeting and keep minutes. However, the LLC structure allows members to determine how an LLC will be structured and operated by executing an operating agreement. In this document, members may choose to include a clause requiring an annual meeting and a requirement to keep minutes at the annual meeting.

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LLC Annual Filing Requirements

All states require an LLC to file either an annual or semi-annual report with the state agency responsible for registering business organizations. This report typically requires an LLC to set forth the name of the LLC, the street address of the LLC's principal place of business, the name and address of any LLC managers and members, and any changes in the LLC's registered agent and registered office. No state requires the submission of the minutes of an annual meeting as part of an annual or semi-annual report.

Benefits

While no state requires an LLC to hold an annual meeting and keep minutes, there are significant benefits to doing so. If a creditor of the LLC sues the LLC and seeks to pierce the corporate veil to hold LLC members personally responsible for LLC debts, holding an annual meeting and keeping minutes is strong evidence that the formalities of the LLC have been maintained. Additionally, if a dispute arises between LLC members that results in litigation, the minutes of the LLC's annual meeting may be highly relevant evidence. Holding an annual meeting also affords LLC members the opportunity to vote on important business matters.

LLC Meeting Minutes

The minutes of an LLC meeting should include the date, time and place where the meeting is held; a list and results of any votes conducted among LLC members; and a status update on the LLC's long-term goals. LLC members present at a meeting should sign the minutes at the conclusion of each meeting.

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What Happens if an LLC Fails to Follow Formalities Such as Keeping Minutes of Meetings?

References

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What Is the Requirement for Annual Meeting Minutes for Florida Corporations?

All corporations formed under Florida law are required to hold an annual meeting of shareholders. The annual meeting, like all corporate meetings, should be adequately documented and recorded in minutes that summarize the points discussed and action taken at the meeting. Although Florida law requires all corporations to make and keep appropriate minutes of meetings, the corporation is not required to file the minutes with any state agency.

Advantages & Disadvantages of a Limited Liability Company

A limited liability company, or LLC, is an entity that offers both advantages and disadvantages to a business owner. The advantages can range from liability protection to tax benefits, while drawbacks may include lack of uniformity and consistency among the state statutes governing LLCs. A savvy business owner should consider all these advantages and disadvantages before deciding whether a limited liability company is the preferred structure for her enterprise.

How to Do Minutes for a Limited Liability Company

A limited liability company, or LLC, legally operates through the majority vote of the members, like a partnership. A corporation, on the other hand, must comply with state and federal regulations that often control detailed aspects of operations, such as how to record meeting minutes, in order to protect those that may have to rely on corporate records to determine whether or not to buy the corporation's stock. There aren't many hard and fast rules of procedure for running an LLC, however, except the rules adopted by mutual consent of the members.

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