LLC is a frequent choice of legal entity for companies in the United States. When you create an LLC, you can also take out an LLC operating agreement. This document is optional under Nevada law, but it often makes your life easier, so it’s highly recommended.
In the agreement, you can specify:
It is imperative to label all this information somewhere to avoid misunderstandings between company members.
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The LLC operating agreement does not need to be certified by a notary, but each member must keep a copy of the document signed by all members. It is also good to provide copies to your investors, accountants, lawyers or attorneys, banks, and title companies. You do not need to give the agreement to the Secretary of State. It will be enough to provide Articles of Organization because some of the information in these documents is duplicated.
Nevada’s LLC operating agreement does not have one form prescribed by law but usually contains the clauses that we indicate below. For easy execution of the agreement, we recommend you use the form-building software on our website.
An LLC operating agreement is good not only in the case of a multi-member LLC but also a single-member LLC because you can specify in the agreement the company’s assets and accordingly secure your personal assets.
Thus, the Nevada LLC operating agreement defines the operational, financial, and management procedures, rights, and powers of the company members and separates the members’ personal assets from their investments in the company.
The execution of this agreement is capable of providing tax incentives for companies in Nevada.
The creation and operation of limited liability companies in Nevada are governed by Chapter 86 of state law.
The operating agreement is governed by NRS 86.286. It states that an operating agreement can only be adopted by unanimous decision and consensus of all members.
Amendments to the agreement can only be made by the members’ general agreement unless otherwise provided in the agreement itself.
An operating agreement does not have to be made before the formation of the LLC. It can be concluded before, after, or when filing the articles of the organization.
The law clarifies the admission of persons as LLC members after the death or expulsion of another member.
We recommend carefully studying the law before creating an operating agreement. You may need legal advice.
1. Come up with your Company’s Name
Your name must be valid. You cannot use a pre-existing name.
The name must necessarily include the designation that this is an LLC.
You cannot use a name that can be misleading. It cannot be mentioned that this is supposedly a bank, hospital, government agency, federal government, and so on. Also, there are about 70 prohibited words that cannot be used in the name of your LLC.
You can always check the validity of your name on special sites.
2. Choose a Registered Agent
A registered agent is needed to receive all legal correspondence. This contact will be used in case of litigation or to receive all legal mail.
An agent can be either an individual or a company. The agent must be registered in Nevada.
You or any company member can also act as a registered agent if you reside in Nevada.
There are also specialized registered agent companies whose services are usually paid for one year.
3. File the Forms
In most states, you only need to complete the Articles of Organization and submit it to the Secretary of State.
In Nevada, you must complete three documents:
Before filling out these documents, you need to decide on the form of management. There are two options:
At the same step, you need to pay fees for the creation of each of the documents.
4. Create an LLC Operating Agreement
As we mentioned, the creation of this agreement is not required by law, but it can make life easier for the members of the company. Therefore it is recommended by all professionals.
An operating agreement allows you to document all agreements on the creation and management of a company and protect personal assets from investments in the company.
5. Obtain an Employer Identification Number
Next, you need to get the EIN from the Internal Revenue Service (IRS). It is a fast and free process that can be done online or by mail.
Each LLC must have its own EIN. The use of others’ is prohibited and impossible.
With the EIN, you can open a bank account, file taxes, process, and transfer salaries, obtain business loans, or obtain a business license.
6. Comply with Annual Requirements
In the state of Nevada, it is mandatory to meet the annual requirement for LLCs:
You will have to pay for each of these documents every year; failure to comply with these requirements entails fines.
Upon completion of these steps, the creation of an LLC will be formally completed, but for the successful functioning of the company, it is still required to:
Registration of an LLC in Nevada is not a difficult task. However, it requires a certain amount of care and thoroughness. If you follow the steps described in our article, then you should not have any additional difficulties. If you still want to be helped, we recommend contacting a specialist.