If you want to change your management structure from manager-managed to member-managed LLC, you will have to amend your Articles of Organization which is also known as Certificate of Formation.
A Limited Liability Company (LLC) is one of the most popular business structures in the United States because of its unparalleled benefits such as limited liability, ease to set up with less paperwork and legal formalities, inexpensive and various tax benefits.
One of the primary benefits of forming an LLC is having a choice of management options. There are two types or structures of management within an LLC:
- Member-Managed LLC
- Manager-Managed LLC
A Comprehensive Guide to Change Your Manager-Managed to Member-Managed LLC (2022)
Member-Managed vs Manager-Managed LLC (What is the difference)
One of the primary decisions you’ll have to make when forming a Limited Liability Company (LLC) is how your business will be managed unless you are the sole proprietor.
There are two main types of management structures in a limited liability company, the member-managed and manager-managed LLC.
In a member-managed limited liability company, the LLC members make daily business decisions such as whether to expand or contract their business. On the other hand, a manager-managed LLC has its management handled by a hired manager rather than its members.
Read this complete guide to Member Managed LLC vs Manager Managed LLC for more details.
Can I change an LLC from manager-managed to member-managed?
If you have a manager-managed LLC and are willing to change your LLC management structure from manager-managed to member-managed, but you are wondering if I can do it or not, the answer is simple: Yes, you can!
How to change an LLC from manager-managed to member-managed?
Each state has its own rules about changing a management structure from manager-managed to member-managed LLC.
However, usually, you will have to amend your LLC’s article of organization. To do this, you have to file an article of amendment with your secretary of state to change your management structure from manager-managed to member-managed LLC.
What is an Article of Amendment?
When a business makes changes to a limited liability company structure, the state requires the filing of an article of amendment. The article of amendment notifies the state of any changes within the LLC’s article of organization.
How do you file an Article of Amendment?
To file an article of amendment, check with your state’s secretary of state office to learn the requirements and any costs associated with the process.
Check this web page to learn more about an Article of Amendment.