What is the management structure of an LLC?
An LLC is typically managed by its members/owners (referred to as member-managed). In that respect, an LLC is unlike a corporation, which has a much more rigid and defined management structure, including directors and officers. All owners of the LLC are typically referred to as members, and they can have control and voting interest proportional to their ownership interest, or in proportions different from their ownership interest; however the members agree such voting should occur in the Operating Agreement. However, an LLC can be also be managed by managers (referred to as manager-management). This makes the LLC operate similar to a Limited Liability Partnership. The vast majority of limited liability companies are member-managed. A manager-managed has important tax ramifications and should not be entered into without consulting a CPA. When you structure your business as an LLC, it is simple to bring new owners (called members) on board, and there is no limit as to how many can be inv
An LLC is typically managed by its members/owners (referred to as member-managed). In that respect an LLC is unlike a corporation, which has a much more rigid and defined management structure, including directors and officers. All owners of the LLC are typically referred to as members, and they can have control and voting interest proportional to their ownership interest proportions different from their ownership interest; however the members agree. NOTE: An LLC can also be managed by managers (referred to as manager-management). This makes the LLC operate similar to a Limited Liability Partnership. The vast majority of limited liability companies are member-managed. A manager-managed has important tax ramifications and should not be entered into without consulting with the appropriate tax and legal professionals.
An LLC is typically managed by its members/owners (referred to as member-managed). In that respect an LLC is unlike a corporation, which has a much more rigid and defined management structure, including directors and officers. All owners of the LLC are typically referred to as members, and they can have control and voting interest proportional to their ownership interest, or in proportions different from their ownership interest; however the members agree.
The owners of an LLC are called members, members are analogous to shareholders in a corporation. Members may manage the LLC or they hire managers to do the job. After an LLC is formed members need to meet and draft the Operating Agreement. The Operating Agreement is an agreement reached by the members of LLC in order to define management arrangement and the members rights.
