Indiana LLC Operating Agreement

There is a great variety of legal forms and entities existing in Indiana. If you intend to form a limited liability company in the state, you need to compile and sign a unique Indiana LLC Operating Agreement Template. And that is precisely what we are discussing in this review – https://formspal.com/llc-operating-agreement-template/.

As you probably can tell from its name, the primary perk of organizing and running an LLC is that this legal form protects its owners from excessive liability for the company’s business. When establishing a business entity, people take enough risks already because there is no guarantee that the game will be worth the contribution. Taking a leap of faith is a very costly adventure that not everyone can afford. Therefore, fresh entrepreneurs and newcomers try to figure out ways to safeguard themselves and their savings.

The purpose of any operating agreement is to formalize the company’s working process and related procedures. It is legally binding for all members and future employees. Thus, to compile an enforceable operating agreement, you need to know the state laws and local legal peculiarities for the agreement to have a binding force. If you do not comply with them, you risk creating a document that is void per the local courts.

So, here is what a standard LLC Operating Agreement should include:

  • A detailed description of the company’s location and the goods and services it provides.
  • A full list of members—please ensure you indicate whether the membership is fixed or not—and their contribution value.
  • Rules on admission of new members (if applicable) and duties of all existing LLC owners.
  • Schedule and frequency of the Board meetings on important company matters.
  • Decision-making process and voting methods.
  • Management and marketing strategies and information about the appointed manager and senior officers (if any).
  • A detailed description of all administrative procedures regarding the working process, such as profit and loss division, tax payments, yearly reporting, and so on.
  • Dissolution details, including initiation of the procedure, the process, property distribution scenarios, and possible outcomes.

Below is information about the local laws and requirements applied to the state LLCs and the necessary steps to establish a limited liability company in Indiana.

Indiana LLC Laws and Definition

The state authorities do not impose compiling and signing an LLC Operating Agreement. So, technically, a limited liability company can exist in Indiana without an operating agreement. But again, it is your legal safety cushion, so to speak, so we strongly advise you to spend some of your time designing a proper LLC agreement. It will help you once a lawsuit against your company or any other related legal matter arises. Plus, remember that you and your co-owners would be financially liable for all the company’s remedies and indebtedness without it. Title 23, Article 18 of the State Code regulates all LLC-related legal matters. Please refer to that legislation in case you need assistance or law interpretation.

The state law distinguishes between the single-member and multi-member LLC; therefore, the requirements for filling out the Operating Agreement for those two types of business entities are different. You need to take that into account when registering your company.

By the current version of the Indiana Code (Section IC 23-18-1-16), an LLC Operating Agreement is a written or oral legally binding agreement of the LLC founding members on its affairs, functioning, and business conduct. Furthermore, under this Section, you will also find the definition of the LLC organizational principles, its purposes, and power granted by the state law. Please make sure you read them thoroughly before proceeding with the founding process.

So, to generalize the above mentioned, here is what an Indiana LLC Operating Agreement represents from the legal point of view:

  1. It is a set of rules and regulations created by the LLC owners to govern the company.
  2. The agreement provides a written record of all the rights and obligations that the members have agreed upon.
  3. It sets forth a fixed framework of business conduct and financial administration.

Steps to Forming an LLC in Indiana

There is no standard Indiana LLC Operating Agreement Form accepted all over the state. Thus, the company owners have a carte blanche in creating their agreement template. But, of course, they should comply with the regulations set in Title 23 of the State Code.

If you do not have the legal confidence to compile such an agreement, we strongly advise you to use our latest form-building software to create the necessary legal form. Our PDF Editor allows you to fill out the form online.

But the agreement compilation is not the only step one needs to take to form an LLC in Indiana. Here is a comprehensive list of instructions on how to organize an operating limited liability company in the state:

1. Create a Unique Company Name

It is probably the most creative part of the LLC registration process. You need to come up with a unique and distinguishing name for your business entity. You can negotiate it with your co-members or think about it alone, but the name should reflect the company’s purpose and its principal business activity. Once you create the company’s name, check if it is used by someone else in the state or around the country.

2. Assign an Indiana Registered LLC Agent

The next step is to choose an agent to represent your company’s interests in all legal matters. On the one hand, it can be a licensed individual obtaining all the necessary skills and personal qualities to deal with the local authorities and customers. On the other hand, you can nominate a business entity entitled to perform business in the state of Indiana.

The assigned Registered Agent should reside or have a valid mailing address in the state. Also, the agent is responsible for reviewing contracts, receiving and processing notices, and filing annual reports.

3. Choose Your Business Entity’s Type

Before registering your LLC, you need to choose the company’s type. There are domestic and foreign LLCs that operate in Indiana. The first type is generally registered in the state, while the latter only has an affiliation or a department operating in Indiana but is registered in another state. Define your LLC type and choose the respective application to fill out.

Please note that one needs to file the Articles of Organization to register a domestic LLC. On the other hand, you need a Certificate of Authority to register a foreign LLC.

4. Pay the Filing Fee and Attach the Receipt

You can file your application form online or via US mail. Depending on that, you will have to pay the filing fee and provide either an electronic payment confirmation or obtain a receipt and submit it with the application form.

You need to pay $95 for an online Domestic LLC application and $100 for filing by mail. The Foreign LLC application filing will cost you $105 for an online version and $125 by mail.

5. Obtain the Template and Fill Out the Agreement

As we have already mentioned above, the Operating Agreement is a necessary document to have at hand when running an LLC in almost any US state. Choose the single-member or multi-member agreement template, fill it out, and submit it with the rest of the required papers to the Secretary of State office. Keep a copy of the record for each signing party (usually, the LLC members).

6. Get the Taxpayer Identification Number

Once you have completed all the previous stages, you can file for an Employer Identification Number (EIN). The IRS office issues this number for tax identification purposes. Without it, your company will not be able to perform financial transactions legally, hire new employees, pay salaries, and order corporate credit cards or joint bank accounts. You can obtain the EIN online by filling out and submitting the IRS Form SS-4.

7. Provide Yearly Reports

Do not forget to compile and submit yearly reports on your financial and business activities to the relevant state services and authorities. If you fail to do so, your company may be subject to additional fees and fines.

Published: Mar 24, 2021