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LLC Operating Agreement

by rookiepartner, Window Shopper

  • Created: April 27, 2012, 6:22 am
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3 comments
We are starting a handyman business and organizing it as an LLC with three members, each with a percentage of the business and profits. Can we organize the LLC so that profit distribution is scheduled monthly? And in addition, can we organize the LLC so that not all of the members will receive profit distribution immediately - i.e., the secondary members begin receiving profit sharing in 6 months while the primary member's distribution begins immediately, thus giving the primary all of the profit for the first 6 months or designated time period?
Tags: Discuss Popular Topics, Starting & Registering a Business
‹ Not sure to form an LLC or S Corporation Import Business Question ›

jjray | Window Shopper | 6/4/2012 - 4:10 pm

"Can we organize the LLC so that profit distribution is scheduled monthly?" What is more common is for members to have monthly draws against their annual earnings with a duty to make up the deficit if the draw turns out to be in excess of the earnings calculated on an annual basis (or at the very least quarterly). To do it monthly, your company needs to close the books and create financial statements every month. If you need a simple operating agreement, you can find one reasonably priced on this website. This comment was edited to remove a link. Please review our Community Best Practices to learn how to best engage in our online discussions. Thank you.
Joseph Raymond
Professional Web Site: VidExplorer, Video Aggregator and Social Network

kmurray | Community Moderator | 5/2/2012 - 8:08 am

Hi,  As BizResearcher said, it would be great to discuss specifics with your attorney so that you get tailored advice for your situation. Our website does provide some general background on LLCs, however, that you may find helpful. 

BizResearcher | Window Shopper | 5/1/2012 - 2:24 pm

These are questions to discuss with your attorney when she/he draws up your
operating agreement. You should be able to structure it any way you want as
long as all partners agree. Because there are three of you, in addition to an
operating agreement, you may also need a partnership agreement. Your attorney
can advise.