An operating agreement is a document that helps protect the business owner’s personal assets from the actions of their LLC, outlines which actions are acceptable for the business, and creates a succession plan in the event the owner exits the business.
Benefits of an Operating Agreement
Having one avoids some of the default rules of the state where you form your LLC. Without an operating agreement, your LLC would default to some of the standard rules and guidelines set by the state.
Helps secure funding from investors and lenders
Operating agreements outline legal and financial details such as decision-making authority and how funds are used that can be helpful when trying to secure funding for your business and increase your ability to grow your company.
An Employer Identification Number (EIN), also called a Tax ID Number, is a 9-digit code assigned by the IRS to identify your business. It’s like a Social Security number for your company. An EIN is often required for a partnership, corporation, or LLC to open a business bank account, gain financing, hire employees, and more.
Why is it Important to Have a EIN?
Without an EIN, it’s more difficult to keep your business and personal funds separate, which could open you up to liability and put your personal assets risk. We highly encourage you to obtain a federal EIN number and open a separate business bank account so you can keep your business and personal transactions separate.
Do you have an awesome name in mind for your business, but you’re not quite ready to get started? You can reserve your business name with the state if you aren’t yet ready to form your LLC or Corporation so that no one else can use it while you are preparing to launch your venture. We can do this for you.