As an entrepreneur, you know how hard you must work to bring your business to a point where it is profitable and sustainable. There are many challenges associated with owning and operating a small business, but there are specific things you can do that will help set your business up for long-term success. One of these things is creating a reasonable operating agreement that will work for your company operations.
An operating agreement is especially important if you have a limited liability company, which is a common choice for many small business owners. This type of business structure limits your personal liability for business debts, but it also provides you with flexibility and clear structure regarding your taxes. An operating agreement is important for the health of your business, the relationship you have with your employees and more.
What’s included in an LLC operating agreement?
An operating agreement identifies your business, outlines how it will operate, names duties for all members and includes other important details that may be important. While your business is unique in many ways, most LLC operating agreements will include the following information:
- Basic information about the company — This might include the company’s name, management structure, purpose of the business, articles of formation and more.
- Tax preference details — LLCs have options regarding how the government taxes them and may select to file as a corporation. This information is in the operating agreement.
- Operating procedures — This document should outline how your business will operate, how you will maintain profitability, how you will add new members and other details.
- Liability statement — Your operating agreement should include details about how you will address the company’s liabilities, protect the interests of members and meet your tax requirements.
The details of your operating agreement matter. You may benefit from seeking input as you create this document at the early stages of your business.
A successful future
The decisions you make during the early stages of starting your Oklahoma company will determine the success of your business going forward. You will benefit from learning about all the options available to you before you make any important decisions. You can gain this insight by speaking with a knowledgeable professional regarding your business goals and intentions for your company.