Single Member LLC Operating Agreement Is Required for Protection
Solo owned businesses make up the largest percentage of business in the US. However, when the LLC laws were first passed, some states did not allow for a single owner to get the protections of this legal entity.This did not make sense and so now all states allow a limited liability company to be owned by just one member. Solo owners need protection just as much as others.
A sole proprietorship business, which is one operated without the benefit of a legal entity, causes the solo business owner to place everything he owns at risk of loss. This stifles new business growth. The single member LLC is the ideal entity for these solo owned ventures because they are very affordable to form and easy to operated and maintain. Now, solo owners can get the personal asset protection they need.
However, the single member limited liability company must have an official and written single member LLC operating agreement. This is because the liability protection is more vulnerable in a single member LLC.
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