LLC Operating Agreement Template: Free Download (2026)
A free LLC operating agreement template covering all 10 sections. Fill in your details and have an attorney review before signing.
Updated 11 min read
An LLC operating agreement template gives you a ready-to-use legal document that defines how your limited liability company is owned, managed, and operated. It covers ownership percentages, profit distribution, voting rights, and what happens if a founder exits, all in one place. 21.6 million active LLCs exist in the United States, yet a majority operate without a written operating agreement, relying instead on default state rules that rarely match what founders actually want.
Get the free template in Google Docs and start filling in your details.
Key Takeaways
- This template covers all 10 core sections of an LLC operating agreement: organization, membership, management, profits, voting, transfers, exit, IP, dissolution, and amendments.
- Designed for both single-member and multi-member LLCs at the formation stage.
- Required by law in California, Delaware, Maine, Missouri, Nebraska, and New York; expected by banks and investors everywhere else.
- Time to complete: 30 to 90 minutes depending on LLC structure complexity.
- A clear operating agreement prevents costly disputes: three co-founders without one spent $35,000 in legal fees and six months in mediation over a simple exit.
Why You Need an LLC Operating Agreement Template
Without an operating agreement, your LLC is governed by your state's default rules. Those defaults are designed for the average business, not yours.
Most state default rules split profits equally among members regardless of how much each person invested. If you contributed 80% of the startup capital, you may still split profits 50/50 with a co-founder by default.
The SBA identifies three reasons every LLC needs one. First, it protects your limited liability status: courts may treat your LLC as a sole proprietorship without documented formality, exposing personal assets. Second, it clarifies verbal agreements before they become disputes.
Third, it overrides state default rules with terms that actually reflect what you and your co-founders agreed to.
Banks require it too. Most financial institutions ask for your operating agreement before opening a business account. Investors, especially venture capital firms and angels, expect a formalized operating agreement before committing funds.
The LLC Operating Agreement Template
Want to skip the copy-paste? Grab the template and start filling it in.
Section 1: Organization Details
Field | Description | Example |
|---|---|---|
LLC Name | Full legal name, matching Articles of Organization exactly | Acme Digital LLC |
Principal Address | Physical street address (no P.O. boxes per most state requirements) | 123 Main St, Austin, TX 78701 |
Date of Formation | Date Articles of Organization were filed | March 15, 2026 |
State of Formation | State where the LLC was formed | Texas |
Governing Law | State whose laws govern the agreement | Texas |
Registered Agent | Name and address of the agent for service of process | Jane Smith, 123 Main St, Austin, TX 78701 |
Business Purpose | Broad statement of what the LLC does | Any lawful business activity permitted under Texas law |
Duration | How long the LLC will exist | Perpetual (no set end date) |
Tip: Keep the business purpose broad. Narrow definitions require amendments every time you expand services.
Section 2: Member Information & Capital Contributions
Field | Description | Example |
|---|---|---|
Member Name | Full legal name of each member | Sarah Chen |
Address | Member's current address | 456 Oak Ave, Austin, TX 78702 |
Ownership Percentage | Membership interest as a percentage | 60% |
Initial Capital Contribution | Cash, property, or services contributed at formation | $30,000 cash |
Additional Contributions | Whether members can be required to contribute more funding | Not required without unanimous member consent |
Tax Classification | How the LLC will be taxed | Pass-through (default); S-corp election by IRS Form 2553 |
For a two-member LLC, repeat the member rows for each co-founder. Ownership percentages must total 100%.
Section 3: Management Structure
Field | Description | Example |
|---|---|---|
Management Type | Who manages the business day-to-day | Member-managed |
Managing Member(s) | Name(s) of members with management authority | Sarah Chen, David Okafor |
Daily Authority | Actions managers can take without member vote | Sign contracts under $10,000; hire employees; open bank accounts |
Major Decisions | Actions requiring member vote | Sell or acquire assets over $50,000; take on debt over $25,000; admit new members |
Voting Threshold (Major) | Vote required for major decisions | Simple majority (>50% of membership interests) |
Supermajority Items | Decisions requiring higher threshold | Amend this agreement; dissolve the LLC (requires 75%) |
Member-managed means all members share management responsibilities. Manager-managed means designated managers (who may not be members) run the business. Most early-stage startups use member-managed for simplicity.
Section 4: Profit & Loss Distribution
Field | Description | Example |
|---|---|---|
Allocation Method | How profits and losses are split | Pro-rata (proportional to ownership percentage) |
Distribution Timing | When distributions are made to members | Quarterly, at the discretion of managing members |
Minimum Distribution | Any required minimum payout to cover tax liabilities | 25% of each member's allocated taxable income |
Reinvestment Priority | Whether profits are reinvested before distributed | First 12 months: all profits reinvested; thereafter at manager discretion |
Tax Allocations | How IRS allocations are handled | Match economic allocations as required by IRC Section 704 |
Most state default rules distribute profits equally. If you contributed more capital or are taking on more risk, specify a custom allocation here.
Section 5: Voting Rights & Decision-Making
Field | Description | Example |
|---|---|---|
Voting Weight | How votes are calculated | Proportional to membership interest (60% owner = 60% of votes) |
Routine Decisions | Low-stakes decisions (manager decides unilaterally) | Daily operations, vendor contracts under $5,000 |
Majority Vote Required | Decisions requiring >50% | Hire/fire key employees; enter contracts over $10,000 |
Supermajority Required | Decisions requiring >75% | Amend operating agreement; dissolve LLC; sell substantially all assets |
Unanimous Consent | Decisions all members must approve | Admit new members; personal guarantees by members |
Meeting Format | How meetings are conducted | In-person, video call, or written consent (email) |
Meeting Frequency | How often formal meetings occur | Annually (or as needed); written consent acceptable in lieu of meeting |
Section 6: Transfer Restrictions
Field | Description | Example |
|---|---|---|
Right of First Refusal | Do existing members/company get to match outside offers? | Yes: company gets first right, then remaining members, proportional to their ownership |
Approval Requirement | Who must approve a transfer to an outside party | Unanimous consent of all other members |
Permitted Transfers | Transfers that don't require approval | Transfers to a member's revocable living trust or wholly-owned entity |
Transfer Prohibition | Any prohibited transfer categories | No transfer to a direct competitor of the LLC without unanimous consent |
Without transfer restrictions, a member can sell their interest to anyone, including someone with no experience or who actively conflicts with the business.
Section 7: Membership Changes (Entry & Exit)
Field | Description | Example |
|---|---|---|
New Member Admission | Process for adding members | Unanimous written consent of existing members; amendment to this agreement |
Voluntary Withdrawal | What happens if a member wants to leave | 90-day written notice; buyout at fair market value within 180 days |
Buyout Valuation | How membership interest is valued for buyout | Independent appraisal, or EBITDA multiple agreed to at time of withdrawal |
Death or Incapacity | What happens to a deceased/incapacitated member's interest | Interest passes to estate; estate has right to economic benefits but not voting rights for 12 months, then mandatory buyout |
Involuntary Transfer | Bankruptcy, divorce, creditor seizure | LLC has right to purchase interest at fair market value within 90 days |
Vesting Schedule | (Optional) For co-founder interests | 4-year vesting with 1-year cliff (25% vests at month 12, remainder monthly) |
The vesting schedule is optional but strongly recommended for co-founded startups. Without it, a departing co-founder keeps 100% of their equity even if they leave after 3 months.
Section 8: Confidentiality, IP & Non-Compete
Field | Description | Example |
|---|---|---|
Confidential Information | What must be kept confidential | All business plans, financials, customer lists, source code, and trade secrets |
IP Ownership | Who owns IP created by members for the business | All IP created by members in connection with LLC business is owned by the LLC |
IP Assignment | Does pre-existing IP get contributed? | Members must disclose and license (or assign) pre-existing IP used by the LLC |
Non-Compete Scope | Geographic and time restrictions on post-exit competition | 12 months post-exit; within the LLC's active markets |
Non-Solicitation | Can departing members poach clients or employees? | No solicitation of LLC clients or employees for 18 months post-exit |
For software or SaaS startups, spell out IP ownership explicitly. Generic templates often miss IP clauses or use vague language that leads to disputes over who owns the code.
Section 9: Dissolution
Field | Description | Example |
|---|---|---|
Dissolution Triggers | What causes the LLC to dissolve | Member vote (supermajority), court order, or statutory event under state law |
Wind-Down Authority | Who manages the dissolution process | Managing members, or a liquidating trustee if both are unavailable |
Asset Liquidation | How assets are converted to cash | Sell or distribute assets; settle all outstanding liabilities first |
Payment Priority | Order of payments during dissolution | (1) Creditors; (2) Member loans; (3) Return of capital contributions; (4) Remaining profits distributed pro-rata |
State Filings | Documents required to dissolve | Articles of Dissolution filed with the Secretary of State |
Section 10: Amendments
Field | Description | Example |
|---|---|---|
Amendment Authority | Who can propose amendments | Any member may propose in writing |
Approval Threshold | Vote needed to amend this agreement | 75% of membership interests (supermajority) |
Written Requirement | Must amendments be in writing? | Yes: signed by all approving members, attached to this agreement |
Effective Date | When amendments take effect | Date of last required signature |
Notice Requirement | How members are notified of proposed amendments | 14 days written notice before vote (email acceptable) |
Example: Filled-In Template
Here is how Section 2 (Member Information) looks for a two-founder SaaS startup:
Field | Member 1 | Member 2 |
|---|---|---|
Name | Priya Nair | Marcus Webb |
Ownership Percentage | 65% | 35% |
Initial Capital | $50,000 cash | $20,000 cash + $10,000 in contributed IP |
Vesting Schedule | 4-year / 1-year cliff | 4-year / 1-year cliff |
Role | CEO (managing member) | CTO (managing member) |
Under Section 4 (Profit & Loss), the same startup specifies:
- Profits allocated 65/35, matching ownership percentages
- Distributions held for 12 months while product is in development; thereafter quarterly at managing member discretion
- 25% of each member's allocated taxable income distributed to cover personal tax liabilities
This structure protects both founders. Priya's larger capital contribution is reflected in the profit split. Marcus's contributed IP is valued and documented, avoiding disputes later if he exits.
How to Use This Template
- Download the Google Doc: Use the free template as your starting point. Make a copy (File > Make a copy) so you have an editable version.
- Fill in Section 1 first: Get the legal name, state of formation, and registered agent right. These must match your Articles of Organization exactly.
- Work through Sections 2 and 3 together: Membership percentages and management structure are interconnected. Decide who manages what before you set voting thresholds.
- Customize the profit and voting sections: The defaults work for most startups. Adjust if your situation calls for preferred distributions or higher consent thresholds.
- Have an attorney review before signing: This template is a strong foundation. An attorney familiar with your state's LLC laws should review the final document, especially if you have investor capital or IP to assign.
- Store the signed agreement securely: Keep a signed copy accessible to all members. Revisit and update it when you add members, take on investors, or significantly change the business.
Recommended Tools
Tool | Best For | Free Plan |
|---|---|---|
Free template, registered agent services | Yes | |
Attorney-reviewed agreements, legal guidance | No | |
Downloadable PDF and Word versions | Yes | |
Guided builder with state-specific language | Yes (limited) |
Conclusion
You now have a complete LLC operating agreement template with all 10 sections, example entries, and a filled-in walkthrough. Download the template, make a copy, and fill it in before you sign your first client contract or open your first business bank account. The 30 minutes you spend now is worth far more than the $35,000 in legal fees that comes from skipping it.
