Do you own a limited liability company? If so, then you are required to have an LLC membership certificate. This is the only way that members of your LLC will be able to prove that they are LLC members.
The following article will discuss how to fill out an LLC membership certificate and what information should be included to cater to your membership interests.
What Is an LLC Membership Certificate?
An LLC membership certificate is a document that states who the members of an LLC are.
In other words, it's a way to prove whether you own a membership interest in your business or not. It also helps determine how much overall profits will be split up among all shareholders and directors (if applicable).
The LLC membership certificate should list the limited liability company's name, the state in which it is registered, and the membership interests of each member.
The membership interest will be represented as a percentage or a fraction ("50/100").
If you are an owner of an LLC, it's important to have a copy of your LLC membership certificate on file. This document can be used to prove your membership interest in the event that there is a dispute or legal action taken against the LLC.
How Do You Fill Out an LLC Membership Certificate?
To fill out an LLC membership certificate, you will need to gather information about the company and its members.
The following steps will walk you through the process of making membership certificates:
- Start by gathering information about the LLC, including its name, state of registration, and agent. You will also need to know the membership interests of all members (represented as a percentage or fraction).
- Next, fill out the membership certificate form. Be sure to list the company's name, state of registration, and a registered agent at the top of the form.
- Under "Membership interests," list each member's name and membership interest (represented as a percentage or fraction).
- Sign and date the membership certificate.
- Have all members sign and date the membership certificate.
Keep in mind that you may need to have your LLC membership certificate notarized by a public notary.
What’s Included in LLC Membership Certificates?
When you issue membership certificates, they must include the following information:
- The company name and its state. This is easy enough to find out by looking at your LLC operating agreement or articles of organization. However, it will also help you if there are multiple LLCs in a single location because then you can tell which one sent this document.
- The name and address of the LLC member. This is pretty self-explanatory, but just in case, make sure to include both the first and last name as well as the mailing address.
- The ownership interest percentage that is being assigned to this particular LLC member. This will be a decimal number followed by "%." For example, if you own a 50% ownership interest in the LLC, your membership interest percentage would be .50.
- The effective date of this certificate. This is usually the day that the document is signed or written.
- Signature lines for all members of the Limited Liability Company. Make sure to get everyone's signature on this document.
Writing an LLC Membership Certificate
Writing and issuing LLC membership certificates may seem like an intimidating task, but it doesn't have to be for the sake of membership interests.
All you need is a LLC membership certificate template and some basic information about the LLC ownership, like the operating agreement and other legal documents.
- First, find out all of the other members' interests in your company by looking at your articles of organization or LLC's operating agreement. If those aren't available, ask each member for their percentage interest.
- Next, fill out the template and have all other members sign it.
You may also want to consider having your member certificate notarized. This is an excellent way to make sure that the membership certificates will hold up in court if it's ever needed for legal purposes.
The template for LLC membership certificates can be found by searching for "LLC membership certificate template" online. You can use the space provided on this form to issue LLC membership certificates in any state where you have formed an LLC or registered as one, rather than retyping each time.
Adding New Membership Units
Adding new membership units to an LLC can be a little more complicated than issuing membership certificates to original members. This is because you will need to amend your company's articles of organization and operating agreement and have everyone who owns a stake in the company sign off on the changes,.
The process for issuing new membership units is as follows:
- First, gather all existing LLC members together so that they can give their consent for adding more membership units.
- Then, amend your articles of organization by filling out a form at your state's LLC office.
- After the amendment is complete, have all members sign and date it.
- Finally, send a copy of the amended document to all members.
Do I Need to Have My Membership Certificate Notarized?
It isn't necessary to have the membership certificates notarized, like an operating agreement in some states. But it's much better.
Having your certificate notarized will make it official and more valuable in terms of ownership and legal purposes, such as buying a home or getting a loan. However, if you're giving someone else (such as an agent) access to view the documents on your behalf, then having them notarize them is sufficient because this person has no vested interest in any potential issues with their authenticity.
What Is the Purpose of Membership Certificates?
LLCs use membership certificates to note individual members' ownership of the company. They're often included with articles of organization or operating agreement and serve as proof that an owner has been admitted to membership.
Is a Membership Certificate the Same as a Share Certificate?
A membership certificate is a document that proves you are a shareholder of an LLC. It's different from a share certificate, which is what investors receive in exchange for their money and how much ownership they technically have. LLC membership certificates only show your right to vote on matters within the company, not your ownership stake or profit participation.
What Is an LLC Membership Ledger?
LLC membership ledgers are documents that list all of the transactions made by a member between specified dates. These records can be used as proof of membership status to determine how much money is owed in fees and other purposes.
How Can I Start an LLC?
You can start an LLC by following these steps:
- Pick a name for your LLC membership and ensure its availability
- Look for a registered agent to represent your limited liability company
- File your LLC's Articles of Organization
- Finish and sign your LLC Operating Agreement
- Make a business bank account for your LLC membership
- Check if your LLC membership needs a business or sales tax license within the state
Are you feeling lost with these processes? Consider getting advice from legal sources and professionals.