This is a question that we receive fairly often at RockyMountainStartup.com. Yes, you can form your LLC on your own without the assistance of an attorney or an online legal document prep website. Upon filing with the secretary of state and paying the $50 filing fee, you will receive Articles of Organization which states that you are legally able to transact business in the name of your LLC. However, most new business owners do not realize that the Articles of Organization offers little in the way of legal liability protection if your business is sued in the future. Why is this important? Because legal liability protection is the entire point of forming an LLC in the first place. Unless your LLC has a solid Operating Agreement document, you are leaving your business and personal assets vulnerable to lawsuits. Our attorneys will prepare a custom Operating Agreement for your LLC which places your new business on a rock solid legal foundation.
An Operating Agreement is a legally enforceable contract that governs relations between the members of the LLC and defines the business operations and governance structure of a Limited Liability Company. This internal agreement describes the members’ rights, obligations, and ownership interests in the company. Though it is not required under the Colorado LLC Act, no serious business owner would operate an LLC without an Operating Agreement in place. A formal written operating agreement lends credibility to your LLC’s separate existence. In business related lawsuits, an Operating Agreement is used to prove that the LLC structure is separate from the individual owner. Therefore, when building a record for litigation, the Operating Agreement can be a key factor in protecting personal assets from judgment. Furthermore, LLCs without an Operating Agreement will be governed by default rules in the Colorado Limited Liability Company Act.
Bottom line- a solid Operating Agreement is essential to provide your business with the legal liability protection it needs to succeed. Let us help you get started today!