LLC organizers will help you prepare an LLC and keep your company formation information in order. The appeal of LLC organizers is easy to see. Not only for the filing of the initial articles but also ongoing compliance. Learn more about LLC organizers here.
Who Is the Organizer of an LLC?
An LLC organizer is someone responsible for the formation of an LLC.
The primary function of an LLC organizer is to file the articles of organization of an LLC with the state’s government.
Therefore, the identity of your LLC organizer is usually required in the formation document of your LLC.
You can be your LLC organizer, especially when you are the owner of a single-member LLC. However, in most cases, due to a lot of legal complexities, LLC organizers are hired by individuals to file their paperwork related to LLC formation.
What does an LLC organizer do?
LLC organizers’ primary duty is to file the articles of organization of an LLC. While you can do all this filing yourself, it is always advised to seek professional services, and this is where the role of professional LLC organizers come.
While no states require you to have a professional LLC organizer, many states put certain limitations on who your LLC organizer should be.
For example, Colorado, Oregon, Illinois, Minnesota, and Texas require LLC organizers to be at least 18 years of age. However, aside from these states, just about anyone can be your LLC organizer irrespective of age.
How to choose the right organizer?
If you have decided not to exercise your option of being an LLC organizer for your LLC, you have multiple choices to choose one. However, it is essential to understand that who should you choose and why?
Professional LLC organizers are either accountants, tax consultants, or lawyers since these are the fields that deal a lot with LLCs.
You can also find an LLC organizer who is neither but still has a firm grasp on the process based on the extensive experience.
When choosing an LLC organizer, you should look for the experience, more than anything, and what follows experience is affordability.
Generally speaking, LLC organizers are not an expensive option.
First, however, you have to make sure that you are neither getting a costly service nor a cheaper but poor service.
LLC Organizers are Not Expensive
It is imperative to understand that, while you are making a cost-free choice of appointing yourself as your LLC organizer, you can risk the process of formation of your LLC.
If you are worried about the cost of LLC organizers, you couldn’t have been more wrong.
LLC organizers are not an expensive option, especially when you consider the fact that they will get all the legal hustle done for you.
There are also no recurring charges associated with obtaining the services of an LLC organizer since it is a one-time process, and once your LLC has been formed, the role of LLC organizer is over.
Benefits of LLC Organizers
There are quite a few benefits of getting the services of LLC organizers. It is why most entrepreneurs across the USA prefer to leave the formation of their LLCs in the hands of professional LLC organizers.
The primary benefit of using LLC organizers is, obviously, the expertise. Since the LLC organizers and LLC organizing companies specialize in drafting and filing articles of the organization of LLCs, their expertise is always helpful in preventing errors that could slow down the process of your LLC formation.
In addition, it makes sure that you are getting the peace of mind that you need to get your business off the ground.
Another significant advantage of using professional LLC organizers is that it will save your time and efforts and the other members of your LLC. When your business is taking off, the last thing you want is to waste your time and efforts in such a technical legal hustle.
Organizer LLC vs Member
As well as your fellow LLC members, you can be your LLC organizers, as we have discussed earlier. However, not every LLC member is an LLC organizer and vice versa.
Here are some differences between your LLC organizers and LLC members:
- LLC members are liable for the execution of business and all the obligations and debts related to the company.
On the other hand, LLC organizers are generally not responsible for any business operations or debts and responsibilities related to the business.
- The majority of the states in America do not want to know anything about the members of LLC. All they deal with is the LLC owner, who is listed in the operating agreement of the LLC.
States form your LLC as per the business laws, and they do not care if you are a single-member LLC or have 99 members in your LLC. However, states do care about who is LLC organizer, as he/she is responsible for the formation of LLC.
- For LLC organizers, there is an option to sign a statement of the organizer. For example, suppose you hire a professional organizing company for your LLC. In that case, you will notice that they will provide you with a statement of the organizer, or it can also be with the name of the initial resolution.
But, of course, LLC members don’t sign such a statement, and they sign the operating agreement of the LLC.
Liabilities of LLC Organizers
Above, we have discussed that LLC organizers are generally not liable for anything related to the LLC because of their limited involvement in forming LLCs.
While this statement is still partially true, and it was utterly true before 2010, an appeals court verdict in 2010 changed the circumference of liabilities of LLC organizers.
According to a ruling of the appeals court in 2010, the liabilities of an LLC organizer are based upon an organizer’s specific role in the LLC.
For example, they could be considered a trustee or fiduciary if they solicit the members of LLC. As a fiduciary, an organizer becomes obligated to disclose if he or she, in any way, is benefitting or will benefit from the LLC.
LLC Organizer vs Registered Agent
While an LLC organizer is all about forming the LLC, a registered agent is responsible for all the documentation related to LLC after its formation.
Thus, an LLC is required by the law to have a registered agent, while there is no legal requirement to have a registered LLC organizer for your LLC.
In any case, you or any member of your LLC can be the registered agent and LLC organizer of your LLC.
However, it is different if you have hired a professional LLC organizers’ service.
If your states’ laws allow, you can then go on and reach a mutual conclusion with your LLC members to extend the responsibilities of your LLC organizers. In that case, if it is allowed, you can use your LLC organizer as the registered agent for your LLC as well.
LLC Operating Agreement vs Articles of Organization
Articles of the organization are also named as a certificate of formation. Therefore, your LLC does not exist on official records unless it has its articles of organization done and the LLC organizers do it.
On the other hand, an operating agreement is an internal LLC agreement formed to help when any dispute arises between the LLC members.
An operating agreement is a primary document related to the handling of operations of LLC, I.e., how it will be operated, how it will be sold, how it will decide on a variety of matters, etc.
All the states in the USA allow LLCs to have an operating agreement and have it signed by LLC members.
So, we can conclude that while an operating agreement is the most crucial document for an LLC, an LLC wouldn’t exist in the first place without articles of organization.
The concept of an LLC organizer is straightforward. In the end, you decide to either do all the legal work related to the formation of your LLC yourself or hire professional LLC organizers to make the entire process smooth and seamless.
Hiring professional LLC organizers is always recommended since it saves a lot of your time and effort to get your business off and running.
Frequently Asked Questions
- Can I be my LLC organizer?
Yes, there is no such legal constraint, and you can be your LLC organizer, although you may not know much about the process compared to a professional LLC organizer.
- Can an LLC have multiple organizers?
Yes, while the state laws require to have at least one LLC organizer to look after all the documentation related to the formation of LLC, you can have multiple organizers to make sure that you are getting things done quickly.
- Can the registered agent and organizer be the same person?
Although the role of an LLC organizer finishes when an LLC is formed, if the laws of your state allow, you can offer extended responsibilities to your LLC organizer. You can use your LLC organizer as a registered agent for your LLC.
- How do I add an organizer to my LLC?
LLC organizers are technically offering a service that you can avail of without adding them to your LLC or any other part of your business. Therefore, they are generally not responsible for any liabilities involving your business.