How to Make an LLC Resolution

By Terry Masters

A resolution adopted by a limited liability company, or LLC, represents the majority decision of the owners of the company on a matter presented for consideration. An LLC is a hybrid business entity that enjoys the operational flexibility of a partnership, but unlike a corporation, doesn't have to follow a particular procedure by law to pass a resolution. An LLC is governed by the consent of its owners. That consent can be oral or in writing, and can address matters on an as-needed basis or in advance through an operating agreement.

Step 1

Circulate the details of the issue to be decided by the owners of the LLC. This can be done by phone calls, in writing, by email, in person or any other way that is convenient. Every state has a Limited Liability Company Act that governs LLC formation, operation and dissolution. This statute will indicate that an LLC is operated by consent of the owners, known as members. An LLC is legally structured like a partnership. The law does not regulate how partners decide to run their business. Any decision made by an LLC, including a resolution, simply needs to have the majority consent of the members.

Step 2

Call a meeting of the owners. State law requires the majority consent of owners for operational decisions. This meeting can be held in person, over the phone, virtually or in any other way that is convenient.

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Step 3

Vote on the resolution. The vote can be oral or in writing, all at once or staggered. The important point is to have a majority of the owners agree to the proposed action.

Step 4

Commit the resolution to writing and have the owners sign it. This is only necessary if you need evidence of the resolution to present to a third party, like a bank. Any agreement by the owners, whether oral or in writing, is enforceable, as long as a majority of the owners agreed to it. You can adopt the format of an ordinary corporate resolution, or any other useful format. Sample resolutions are available online or by buying a corporate records book from a book, stationery or office supply store.

Step 5

Keep a copy of the resolution with the company records. Treat the resolution like any other important business record. If the LLC has an operating agreement, file the resolution in the same general area.

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What Is an LLC Resolution?



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