LLC Formation Requirements
Pennsylvania LLC Formation Statute
The following LLC Formation statutes are from subchapter B of the Pennsylvania Uniform Limited Liability Company Act of 2016:
Section 8821. Formation of limited liability company and certificate of organization.
(a) Formation.--One or more persons may act as organizers to form a limited liability company by delivering to the department for filing a certificate of organization.
(b) Required contents of certificate.--A certificate of organization must state:
(1) the name of the limited liability company, which must comply with Subchapter A of Chapter 2 (relating to names); and
(2) subject to section 109 (relating to name of commercial registered office provider in lieu of registered address), the address, including street and number, if any, of the company's registered office.
(c) Optional contents of certificate.--A certificate of organization may contain statements as to matters other than those required by subsection (b), but may not vary or otherwise affect the provisions specified under section 8815(c) and (d) (relating to contents of operating agreement) in a manner inconsistent with that section.
(d) Substitute certificate of authority.--A statement in a certificate of organization with respect to a matter described in section 8832(a)(2) or (3) (relating to certificate of authority) is effective as a certificate of authority and the statement is subject to the provisions of section 8832 in the same manner as a certificate of authority.
(e) Effect of certificate of organization.--A provision of the certificate of organization shall be deemed to be a provision of the operating agreement for purposes of any provision of this title that refers to a rule as set forth in the operating agreement.
(f) Time of formation.--A limited liability company is formed when its certificate of organization becomes effective.
What This Means: Key Takeaways*
Required Information for Pennsylvania LLC Formation:
- LLC’s name (Must meet Pennsylvania LLC naming requirements)
- LLC principal office’s street and mailing address
- Registered office’s address, including street name and number, or commercial registered office provider’s name and office address
Optional Information for Pennsylvania LLC Formation:
- LLC organizers can add their own provisions as long as the provisions don’t conflict with LLC statute.
Recommended: For help with completing the LLC formation forms, visit our Pennsylvania LLC Certificate of Organization guide.
Registered Office Duties and Appointment
Pennsylvania LLC laws define the duties and appointment of the LLC registered office.
Pennsylvania LLC Registered Office Statute
The following registered office laws are from the Pennsylvania Uniform Limited Liability Company Act of 2016:
8825. Registered office.
(a) General rule.--Every limited liability company shall have and continuously maintain in this Commonwealth a registered office which may, but need not, be the same as its place of business.
(b) Change of registered office.--After organization, a change in the location of the registered office may be effected at any time by the company. Before the change becomes effective, the company shall amend its certificate of organization under the provisions of this chapter to reflect the change in location or shall file with the department a certificate of change of registered office setting forth:
(1) The name of the company.
(2) The address, including street and number, if any, of its then-registered office.
(3) The address, including street and number, if any, to which the registered office is to be changed.
(c) Alternative procedure.--A limited liability company may satisfy the requirements of this chapter concerning the maintenance of a registered office in this Commonwealth by setting forth in any document filed in the department under any provision of this chapter that permits or requires the statement of the address of its then-registered office, in lieu of that address, the statement authorized under section 109(a) (relating to name of commercial registered office provider in lieu of registered address).
What This Means: Key Takeaways*
A Pennsylvania registered office must be a Pennsylvania street address (i.e., no P.O. boxes)
Registered office information is kept on file by the Commonwealth of Pennsylvania. If you change your registered office, you must file a change of registered office form.
Pennsylvania LLC laws provide guidelines for creating and maintaining an LLC operating agreement.
The following operating agreement statutes are from the Pennsylvania Uniform Limited Liability Company Act of 2016:
Section 8815. Contents of operating agreement.
(a) Scope of operating agreement.--Except as provided under subsections (c) and (d), the operating agreement governs:
(1) relations among the members as members and between the members and the limited liability company;
(2) the rights and duties under this title of a person in the capacity of a member or manager;
(3) the activities and affairs of the company and the conduct of those activities and affairs;
(4) the means and conditions for amending the operating agreement; and
(5) the means and conditions for approving a transaction under Chapter 3 (relating to entity transactions).
(b) Title applies generally.--To the extent the operating agreement does not provide for a matter described in subsection (a), this title governs the matter.
(c) Limitations.--An operating agreement may not do any of the following:
(1) Vary a provision of Chapter 1 (relating to general provisions) or Subchapter A of Chapter 2 (relating to names).
(2) Vary the right of a member to approve a merger, interest exchange, conversion, division or domestication under section 333(a)(2) (relating to approval of merger), 343(a)(2) (relating to approval of interest exchange), 353(a)(3) (relating to approval of conversion), 363(a)(2) (relating to approval of division) or 373(a)(2) (relating to approval of domestication).
(3) Vary the required contents of a plan of merger under section 332(a) (relating to plan of merger), plan of interest exchange under section 342(a) (relating to plan of interest exchange), plan of conversion under section 352(a) (relating to plan of conversion), plan of division under section 362(a) (relating to plan of division) or plan of domestication under section 372(a) (relating to plan of domestication).
(4) Vary a provision of Chapter 81 (relating to general provisions).
(5) Vary the provisions of section 8811(b), (c) and (d) (relating to short title and application of chapter).
(6) Vary the law applicable under section 8814 (relating to governing law).
(7) Vary a provision of section 8818(d) (relating to characteristics of limited liability company).
(8) Vary a provision of section 8819 (relating to powers).
(9) Vary any requirement, procedure or other provision of this title pertaining to:
(i) registered offices; or
(ii) the department, including provisions pertaining to documents authorized or required to be delivered to the department for filing under this title.
(10) Provide indemnification or exoneration in violation of the limitations in sections 8848(g) (relating to reimbursement, indemnification, advancement and insurance), 8849.1(j) (relating to standards of conduct for members) and 8849.2(h) (relating to standards of conduct for managers).
(11) Eliminate the duty of loyalty provided for in section 8849.1(b)(1)(i) or (ii) or (2) or the duty of care of a member in a member-managed company, except as provided in subsection (d).
(12) Eliminate the duty of loyalty provided for in section 8849.2(b)(1)(i) or (ii) or (2) or the duty of care of a manager, except as provided in subsection (d).
(13) Vary the contractual obligation of good faith and fair dealing under section 8849.1(d) or 8849.2(d), except as provided in subsection (d).
(14) Restrict the duties and rights under section 8850 (relating to rights to information), except as provided in subsection (d).
(15) Vary the causes of dissolution specified in section 8871(a)(4) (relating to events causing dissolution).
(16) Vary the requirements to wind up the company's activities and affairs specified in section 8872(a), (b)(1), (e) and (f) (relating to winding up and filing of certificates).
(17) Unreasonably restrict the right of a member to maintain an action under Subchapter H (relating to actions by members).
(18) Vary the provisions of section 8884 (relating to special litigation committee), except that the operating agreement may provide that the company may not have a special litigation committee.
(19) Vary a provision of Subchapter I (relating to benefit companies).
(20) Except as provided in section 8817(b) (relating to amendment and effect of operating agreement), restrict the rights under this title of a person other than a member or manager.
(d) Permitted terms.--Subject to subsection (c)(10), the following rules apply:
(1) The operating agreement may:
(i) specify the method by which a specific act or transaction that would otherwise violate the duty of loyalty may be authorized or ratified by one or more disinterested and independent persons after full disclosure of all material facts;
(ii) alter the prohibition stated in section 8845(a)(2) (relating to limitations on distributions) so that the prohibition requires only that the company's total assets not be less than the sum of its total liabilities; and
(iii) impose reasonable restrictions on the availability and use of information obtained under section 8850 and may define appropriate remedies, including liquidated damages, for a breach of any reasonable restriction on use.
(2) To the extent the operating agreement of a member-managed limited liability company expressly relieves a member of a responsibility that the member would otherwise have under this title and imposes the responsibility on one or more other members, the operating agreement also may eliminate or limit any fiduciary duty of the member relieved of the responsibility that would have pertained to the responsibility.
(3) If not manifestly unreasonable, the operating agreement may:
(i) alter the aspects of the duty of loyalty stated under section 8849.1(b)(1)(i) or (ii) or (2) or 8849.2(b)(1)(i) or (ii) or (2);
(ii) prescribe the standards, if not manifestly unreasonable, by which the performance of the contractual obligation of good faith and fair dealing under section 8849.1(d) or 8849.2(d) is to be measured;
(iii) identify specific types or categories of activities that do not violate the duty of loyalty;
(iv) alter the duty of care; and
(v) alter or eliminate any other fiduciary duty.
(e) Determination of manifest unreasonableness.--The court shall decide as a matter of law whether a term of an operating agreement is manifestly unreasonable under subsection (d)(3). The court:
(1) shall make its determination as of the time the challenged term became part of the operating agreement and by considering only circumstances existing at that time; and
(2) may invalidate the term only if, in light of the purposes, activities and affairs of the limited liability company, it is readily apparent that:
(i) the objective of the term is unreasonable; or
(ii) the term is an unreasonable means to achieve the term's objective.
What This Means: Key Takeaways*
An LLC operating agreement allows LLC members to create rules for how their unique LLC operates. These rules are often called “terms” or “provisions.”
Operating agreements are limited by state statute. For example, if the statute says LLC members can’t dissolve an LLC without all members agreeing, LLC members can’t change or override the statute with an operating agreement.
When an operating agreement is in place, it’s easier to navigate situations involving the operation of the LLC. And, if a lawsuit or dispute arises, LLC members (or the courts) have something to reference.
If a dispute arises that can’t be resolved by LLC members and there isn’t an operating agreement, the courts will use LLC statute to resolve disputes.
Creating an Operating Agreement
Some LLCs, such as professional LLCs or real estate LLCs, might need unique terms, while others might only need to cover standard provisions:
- Each member’s responsibilities
- How new members will be admitted
- How existing members may transfer or terminate their membership
- How profits and dividends will be distributed
- The process for amending the operating agreement
Decennial Report Requirements
Pennsylvania LLC laws set out the requirements for decennial LLC reporting. The Commonwealth of Pennsylvania has created a PDF decennial report form to simplify the process.
Pennsylvania LLC Annual Report Statute
The following decennial report statutes are from Title 54 Section 503 of the Pennsylvania Consolidated Statutes:
Section 503. Decennial filings required.
(a) General rule.--Except as otherwise provided in this section, every corporation or other association whose name is registered under this chapter shall, during the year 2001 and every tenth year thereafter, file in the department a report, which shall be executed by the corporation or other association, and shall set forth:
(1) The name of the corporation or other association.
(2) The address, including street and number, if any, of its registered or other office.
(3) A statement that the corporation or other association continues to exist.
(4) Such other information necessary to the administration of this chapter as the department may specify by regulation.
(b) Exceptions.--Subsection (a) shall not apply to any of the following:
(1) A corporation or other association that during the ten years ending on December 31 of the year in which a filing would otherwise be required under subsection (a) has made any filing in the department pursuant to a provision of this title or 15 Pa.C.S. (relating to corporations and unincorporated associations) other than:
(i) a report required by subsection (a); or
(ii) a filing under 15 Pa.C.S. § 208 (relating to reservation of name) or 209 (relating to registration of name of nonregistered foreign association).
(2) A corporation whose name is registered pursuant to section 501(a)(4) (relating to register established).
(3) A corporation that has had officer information forwarded to the department by the Department of Revenue during the preceding ten years under 15 Pa.C.S. § 1110 (relating to annual report information).
What This Means: Key Takeaways*
Your Pennsylvania LLC decennial report must state the following information (and must be current as of the date of filing):
- The name of the LLC
- Complete street address of registered or other office
- A statement that the LLC continues to exist
Decennial Report Due Date:
- Decennial reports are due between every 10th year after the date LLC’s effective date year
Decennial Report Exceptions:
You do not need to file a decennial report if you make a new or amended filing during the prescribed 10-year period. Exceptions to that rule include:
- Name reservation
- Name search
- Consent to appropriate name
- Fictitious name registration
*This information is provided for educational and entertainment purposes only. Please consult a lawyer for legal advice.