LLC Organizer Vs Member
What’s the difference between an LLC organizer and a member? An LLC organizer is the person or company who files your LLC formation paperwork with the state. Meanwhile, an LLC member is any individual or business with ownership interest in your LLC—in other words, an owner. It’s possible—but not necessary—for these roles to overlap: an LLC member can be an organizer, but an LLC organizer doesn’t need to be a member.
What you'll find in this article:
What is an LLC Organizer?
What is an LLC Member
LLC Organizer Vs Member FAQs
What is an LLC Organizer?
Your LLC organizer is in charge of filing your LLC formation documents—i.e., your Articles of Organization—with the state.
As such, your LLC organizer’s responsibilities include:
- Filling out your formation paperwork completely and accurately.
- Listing their name and contact information on your formation paperwork (which becomes public record).
- Submitting your formation documents and filing fee to the state.
You or another member of your LLC can serve as your LLC organizer. However, many LLCs find it helps to have someone like an attorney or a registered agent perform this role. One reason for this is that your Articles of Organization are a public document, so having an LLC organizer who is not a member of your LLC can help maintain your privacy by keeping your personal details off the public record.
What are an LLC Organizer’s Duties?
An LLC organizer’s job seems simple, but it’s very important. Your LLC organizer must ensure that your formation documents are filled out appropriately and that all filing fees are paid. If there are any errors, the state won’t accept your filing, or you’ll have to file an amendment to correct your Articles of Organization. You’ll have to spend more time—and probably more money—to get your LLC registered properly. And, of course, this delays your ability to start doing business.
If your LLC organizer isn’t a member of your LLC, they should provide you with a Statement of Organizer after fulfilling their filing responsibilities. In their statement, your LLC organizer should clearly express that they relinquish their organizer duties and that full control of your LLC is in the hands of your LLC members. This will eliminate any possible confusion over who owns the LLC in the eyes of any organization that wants to know why the name on your formation documents doesn’t match any of your members’ names (for example, a bank or government agency).
Learn more about starting an LLC.
Who can be an LLC organizer?
You can appoint an individual or another business to serve as your LLC organizer. For example, some LLCs hire a company that provides LLC formation services to perform LLC organizer duties.
Common choices for LLC organizer include:
- yourself or another LLC member
- a friend or family member
- an attorney
- an accountant
- a business formation service
- your registered agent
Having your registered agent act as your organizer can be a convenient option because your registered agent is already prepared to receive legal correspondence from the state on behalf of your LLC.
LLC Organizer Vs. Registered Agent
Wondering about the distinction between an LLC organizer and a registered agent?
In most states, LLCs are required to appoint a registered agent. A registered agent is the person or company you elect to receive legal notices, such as service of process, on behalf of your LLC. Your registered agent needs a street address in the state where your LLC operates. An individual, such as a member of your LLC or an attorney, can act as your registered agent. You can also hire a company that offers registered agent service to take on these duties, like Northwest.
Your registered agent can also act as your LLC organizer. In fact, it’s a popular choice for many LLCs. Your registered agent—especially if you hire registered agent service—knows state formation documents inside and out. They know what information must be included and how to make sure your Articles of Organization are accepted without any hiccups.
Additionally, because your registered agent’s name and contact information must be included on your Articles of Organization, it’s no trouble to put their information instead of your own in the organizer section of your formation documents, as well. Basically, if your main objective with using a non-member LLC organizer is to protect your privacy by keeping your personal information off the public record, your registered agent is already perfectly positioned to help you accomplish this goal.
Learn how to live privately with an LLC.
What is an LLC Member?
Your LLC members are the owners of your LLC. If you’re a single-member LLC, then that’s just you. Otherwise, your members are every person or entity with ownership interest in your LLC.
Ownership interest is based on the amount each member invests in your LLC to get it started. For example, say you invest $100,000, and you have two other members who each invest $50,000, making your total investment $200,000. You personally have 50% ownership interest because you invested 50% of the funds. When drafting your LLC’s operating agreement, make sure to include ownership interest details to help protect each member’s financial interest in the company.
What does an LLC member do?
What an LLC member does depends on whether you have a member-managed or manager-managed LLC.
If your LLC is member-managed, your members oversee the everyday operations of your LLC and make sure that your company is accomplishing its goals. Members’ duties can range from taking care of minutiae like ordering more printer paper to directing major projects like developing a new financial strategy.
If your LLC is manager-managed, your members hire other people (or even another company) to run your business. Your members are still involved in big decisions for your LLC, especially in situations where your operating agreement requires a vote of all LLC members. However, your members are not involved in the day-to-day activities of the business.
Who can be an LLC member?
LLC members can be people or business entities.
- individuals, including US and Non-US citizens
- other LLCs, domestic and foreign
- corporations, domestic and foreign
- estates and trusts
Most states don’t place any restrictions on LLC ownership. However, if you are unsure about whether or not a particular individual or entity qualifies, consult the secretary of state or other agency in charge of business registration in your state.
There’s also no limit on the number of members your LLC can have unless you decide to have your LLC taxed as an S-Corp, in which case you’ll need to limit your LLC to 100 members.
LLC Organizer Vs Member FAQs
Is an organizer the same as an owner?
No. An organizer simply prepares and submits your formation paperwork to the state. While it’s possible for an LLC owner (member) to serve as your LLC organizer, these roles are not otherwise connected, and your organizer does not need to be an owner.
Can I be my own LLC organizer?
Yes. You can serve as your own LLC organizer. You’ll need to fill out and submit your Articles of Organization to the state. Your information will go on the public record.
Is there any liability associated with being an LLC organizer?
No. There isn’t any liability associated with being an LLC organizer. However, if your LLC organizer is also an LLC member, there may be liabilities associated with your role as a member related to your financial or legal obligations to the LLC.
Can an LLC organizer be anonymous?
No. LLC organizers must provide their names and, in some states, addresses when filing LLC formation paperwork.
Can LLC members be anonymous?
Yes, in some states. A few states—Delaware, Nevada, New Mexico, and Wyoming—allow for anonymous LLCs. You will not have to provide LLC member information on your LLC formation paperwork.
Can an organizer be removed from an LLC?
Yes. If your organizer will not be involved with your LLC after filing your formation documents, they can draft a State of Organizer severing their connection to your LLC and verifying that they have no control over your LLC. If you wish to remove your organizer’s name from your formation documents, you can file an amendment with the state and replace their name with the name of one of your members or a different organizer (like an attorney or registered agent).