Best Practice for LLC Meeting Notes
Member since 2021 · 7 posts · 2 votes
Thanks!
Correct, in essence what you're doing with the Unanimous Consent in Lieu of Annual Minutes is you're just signing a list of "notes" from yourself to yourself. You sign/date at the bottom. And done. These are usually one pagers. But having it at least typed up and printed provides the appearance that you are up keeping with corporate formalities. These take us minimal time to put together.
I think the big question is how many members are in the LLC? If it's just you, then it's pretty simply. I am speaking from a lending standpoint, but we'll usually ask for a "Unanimous Consent" for the loan, but that's pretty much it. How many members are in the LLC? That will allow us to give you a good answer.
Hi Tam.
There is no statutory or case law requirement for LLCs to have annual meeting minutes.
Having said that, I definitely create annual meeting minutes for my LLCs for the following reasons:
1) it's fairly straightforward to do
2) it shows that you are following corporate formalities which strengthen the legitimacy of the LLC
3) it makes it more difficult for a creditor to 'pierce the corporate veil' meaning the creditor argues that the LLC is really just a proxy for you and thus tries to pursue you personally for damages
I also recommend that each LLC has its own bank account and that funds are never mixed between companies.
Hope that this helps!
I think the big question is how many members are in the LLC? If it's just you, then it's pretty simply. I am speaking from a lending standpoint, but we'll usually ask for a "Unanimous Consent" for the loan, but that's pretty much it. How many members are in the LLC? That will allow us to give you a good answer.
Hi Tam.
There is no statutory or case law requirement for LLCs to have annual meeting minutes.
Having said that, I definitely create annual meeting minutes for my LLCs for the following reasons:
1) it's fairly straightforward to do
2) it shows that you are following corporate formalities which strengthen the legitimacy of the LLC
3) it makes it more difficult for a creditor to 'pierce the corporate veil' meaning the creditor argues that the LLC is really just a proxy for you and thus tries to pursue you personally for damages
I also recommend that each LLC has its own bank account and that funds are never mixed between companies.
Hope that this helps!
@Tam Nguyen Sorry to interject, but to your reply right above, no, you should not have State #1 LLC send funds to State #2 LLC or vice versa. However, since they would both be owned by your holding LLC, they can each "kick up" directly to the holding LLC.
To the point made by @Charley Gates, having a record of annual "minutes" is another added (and thorough) layer of your annual corporate maintenance to have as proof that you are in fact treating the LLC entity as its own separate entity, and not an alter ego of yourself. The reason I put minutes in quotation marks is because your recording of minutes does not need to be anything super complex. We usually prep what's called Unanimous Consent in Lieu of Annual Minutes for folks and it pretty much just bullet points the high level activity of the entity over the last year.
Chime back if you have any other q's.
Hi Tam.
There is no statutory or case law requirement for LLCs to have annual meeting minutes.
Having said that, I definitely create annual meeting minutes for my LLCs for the following reasons:
1) it's fairly straightforward to do
2) it shows that you are following corporate formalities which strengthen the legitimacy of the LLC
3) it makes it more difficult for a creditor to 'pierce the corporate veil' meaning the creditor argues that the LLC is really just a proxy for you and thus tries to pursue you personally for damages
I also recommend that each LLC has its own bank account and that funds are never mixed between companies.
Hope that this helps!
Hi Tam: I agree with the reply from @Luis Alvarez
You should not have State 1 LLC transfer money directly to State 2 LLC. Instead, the flow of money should follow the organizational chart (e.g., State 1 LLC --> holding company LLC --> State 2 LLC).
Hope that this helps.
Hi Tam.
There is no statutory or case law requirement for LLCs to have annual meeting minutes.
Having said that, I definitely create annual meeting minutes for my LLCs for the following reasons:
1) it's fairly straightforward to do
2) it shows that you are following corporate formalities which strengthen the legitimacy of the LLC
3) it makes it more difficult for a creditor to 'pierce the corporate veil' meaning the creditor argues that the LLC is really just a proxy for you and thus tries to pursue you personally for damages
I also recommend that each LLC has its own bank account and that funds are never mixed between companies.
Hope that this helps!
No specific need to execute a loan to yourself, since you are a member of the LLC, (when you are sending funds from your personal account to the LLC account) you are just making a capital contribution to the LLC. Indeed, you should make sure that the capital contributions are sufficient in size ($2,000, $5,000, etc.) rather than small contributions at a time (as transactions come up) so that you are following the proper corporate maintenance of "proper capitalization".
However, if you did want to execute a Promissory Note to or from the LLC (for other reasons) that can be easily put together and nothing too official needs to be done with that. I can always provide more details around that.
Hi Tam.
There is no statutory or case law requirement for LLCs to have annual meeting minutes.
Having said that, I definitely create annual meeting minutes for my LLCs for the following reasons:
1) it's fairly straightforward to do
2) it shows that you are following corporate formalities which strengthen the legitimacy of the LLC
3) it makes it more difficult for a creditor to 'pierce the corporate veil' meaning the creditor argues that the LLC is really just a proxy for you and thus tries to pursue you personally for damages
I also recommend that each LLC has its own bank account and that funds are never mixed between companies.
Hope that this helps!
If these are all solo LLCs, you can write your minutes on a yellow pad and say I meet to determine there are no changes to the LLC and file it a draw. (Or create a Word doc and store it on your computer (after you signed it). There is no need to make it complicated. There is a great book with good information Veil Not Fail by Garret Sutton. It is worth the time to read it.
Correct, in essence what you're doing with the Unanimous Consent in Lieu of Annual Minutes is you're just signing a list of "notes" from yourself to yourself. You sign/date at the bottom. And done. These are usually one pagers. But having it at least typed up and printed provides the appearance that you are up keeping with corporate formalities. These take us minimal time to put together.