LLC Operating Agreement: What to Include + Free Template (2026)

No matter what kind of business you run, having an operating agreement is important. An operating agreement gives you a chance to explain how your LLC will function. This legal document isn’t required by the state to set up a limited liability company, but business experts all agree that creating this document before serving customers is ideal. We’ve put together some information about operating agreements. It explains what this document is and how to create one.
An LLC operating agreement is a legal document that defines how your LLC is owned, managed, and operated. It covers everything from profit distribution and member responsibilities to what happens if a member leaves or the business dissolves.
Even though most states don’t legally require one, an operating agreement is essential for protecting your personal liability and preventing member disputes.
An operating agreement is an internal document — you don’t file it with the state. It’s a contract between the LLC’s members that establishes:
Without an operating agreement, your LLC defaults to your state’s LLC act — which may not align with what you and your co-owners actually want. For example, most state default rules split profits equally among members, regardless of how much each person invested.
Only a few states legally require LLCs to have an operating agreement. But every LLC should have one, regardless of state law.
Even in states that don’t require it, you’ll need an operating agreement to:
A thorough operating agreement should cover these key sections:
There are two management options:
Your operating agreement should specify which structure you’re using and what authority managers have.
For single-member LLCs: Your operating agreement is mainly about establishing the LLC as a separate legal entity. Without it, a court could “pierce the corporate veil” and hold you personally liable for business debts.
For multi-member LLCs: Your operating agreement is the rulebook that prevents disagreements from becoming lawsuits. Cover every scenario — especially what happens when someone wants out.
You have three options:
Suitable for simple single-member LLCs. Many LLC formation services provide a basic template. Our top pick, Northwest Registered Agent, includes a free operating agreement template with every formation.
Services like LegalZoom, Rocket Lawyer, and LawDepot offer customizable operating agreement generators. You answer questions about your LLC, and the service generates a tailored document. Good for multi-member LLCs with straightforward terms.
Recommended for multi-member LLCs with complex arrangements — like unequal capital contributions, different classes of membership interests, or specific buyout terms. An attorney ensures your agreement complies with state law and covers all potential disputes.
Business circumstances change, and your operating agreement should change with them. Common reasons to amend:
To amend your operating agreement:
You don’t need to file amendments with the state — the operating agreement is an internal document.
Yes. There’s no legal requirement to use a lawyer. For single-member LLCs, a free template is usually sufficient. For multi-member LLCs with complex terms, an attorney is worth the investment to prevent future disputes.
Technically, most states don’t require it. Practically, yes — you need one. An operating agreement is your primary evidence that the LLC is a separate entity from you personally. Without it, courts may disregard your LLC’s liability protection. Banks may also refuse to open a business account without one.
Your LLC defaults to your state’s LLC act, which includes generic rules for profit sharing, management, and dissolution. These defaults may not match your intentions. For multi-member LLCs, the lack of a written agreement is a common source of expensive legal disputes.
No. Articles of organization are filed with the state to officially create your LLC. An operating agreement is an internal document that governs how the LLC operates. You need both, but only articles of organization are filed with the state.
Using a template: 30-60 minutes. Using an online service: 1-2 hours. With an attorney: 1-2 weeks (including drafting, review, and revisions). The time investment depends on complexity — a single-member LLC takes much less time than a multi-member LLC with custom terms.
Yes. Operating agreements can be amended at any time, following the amendment procedure outlined in the agreement itself. Most agreements require a majority or unanimous vote of members to approve changes. Always put amendments in writing and have all members sign.
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