Q: Adding a new member to a single-member LLC
I established a single-member LLC in California in 2018. Now, I would like to add another member to this LLC by giving him 50% of the ownership. I already received a new EIN from IRS for this two-member LLC. Now the question is what form do I need to file on California State's website? Do I need to file a modified Article of Organization? Do I need to file a new Statement of Information? Thanks for your help.
A:
I recommend that you consult with your CPA and a business attorney. Your question poses a few layers.
First, unless the Articles of Organization prevent additional members, the LLC can have more than 1 member without the need to file Amended Articles of Organization. If you are unsure, then you should have the Articles reviewed by a business attorney.
Second, you will need to file an updated Statement of Information with the California Secretary of State to note the change in members.
Third, the LLC should not have needed a new EIN. You should consult with your CPA about the LLC having 2 EINs.
Lastly, you should consult with a business attorney about drafting an Operating Agreement. An Operating Agreement is the contract between the members and the LLC that details management and member rights.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
