Massachusetts LLC Operating Agreement

Every Massachusetts LLC should have an operating agreement in place. 

While not legally required by the state, having a written operating agreement will set clear rules and expectations for the management and operations of your LLC.

Download our free Massachusetts operating agreement template below or sign up to create a custom operating agreement using our free tool.

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Free Massachusetts LLC Operating Agreement Templates

We offer operating agreement templates for single-member LLCs and multi-member LLCs (including member-managed and manager-managed) as well as a customizable operating agreement tool.

Single-Member LLC Operating Agreement

Our single-member LLC operating agreement template was created for limited liability companies with only one member, where the sole member has full control over all affairs of the LLC and no other individuals have a membership interest in the company.

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Sample single-member LLC operating agreement.

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Multi-Member LLC Operating Agreements

Our multi-member LLC templates are meant for LLCs with more than one member. There are two types available: manager-managed and member-managed.

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Sample member-managed multi-member LLC operating agreement.

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Download Manager-Managed LLC Template

Sample member-managed multi-member LLC operating agreement.

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Create Custom Operating Agreement

Create a custom operating agreement using our free tool. Just answer a few basic questions, and the tool will develop an operating agreement for your new LLC.

To use our tool, you will need to sign in to our Business Center. A Business Center account will also grant you access to many other free tools, special discounts on business services, and much more. 

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What Is a Massachusetts LLC Operating Agreement?

An operating agreement is a legal document that outlines the ownership structure and operating procedures of an LLC.

Whether you are starting a single-member or multi-member LLC, your operating agreement should address all of the topics below. Some of these stipulations will not have much bearing on the actual operations of a single-member LLC, but are still important to include for the sake of legal formality.

  1. Organization: When the LLC was officially formed, who its members are, and how ownership is divided. Multi-member LLCs may utilize an equal ownership structure or assign various members different “units” of ownership.
  2. Management & Voting: Whether the LLC will be managed by its members or by an appointed manager, and how members will go about voting on business matters. Typically, each member has one vote, but you may wish to give some members more voting power than others. For more information on managing your LLC, read our Member-Managed vs Manager-Managed guide.
  3. Capital Contributions: The amount of money each member has invested in the business. This is also where you should establish an approach to raising additional funds in the future.
  4. Distributions: How profits and losses will be divided among the members. The most common option is to distribute profits evenly. If you want them divided a different way, this should be detailed in your operating agreement. For more information on the basics of LLC ownership, read our Contributions and Distributions guide.
  5. Changes to Membership Structure: How roles and ownership will be transferred in the event that a member leaves the company. It’s essential to lay out the process for buying out and/or replacing a member in the LLC’s governing document.
  6. Dissolution: Dissolution: If at some point all the members of your LLC decide you no longer wish to conduct business, you should officially dissolve it. Outlining the hypothetical process of dissolving your business is an important aspect of your operating agreement. To learn how to dissolve your Massachusetts LLC, read our Massachusetts LLC Dissolution article.

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Why Should I Have a Massachusetts LLC Operating Agreement?

No matter what type of Massachusetts LLC you're starting, you'll want to create an operating agreement. Here's why:

  1. It’s recommended by the state. According to Massachusetts General Laws, Limited Liability Company Act Ch. 156C § 24, every Massachusetts LLC may adopt a written or oral operating agreement to govern the company’s operating procedures.
  2. It'll prevent conflict among your business partners. If you're starting a multi-member LLC, having an operating agreement will prevent misunderstandings amongst your team by setting clear expectations about each partner's role and responsibilities.
  3. It helps preserve your limited liability status. If you're the sole owner of a single-member LLC in Massachusetts, having an operating agreement will help to ensure your limited liability status is upheld by court officials, and add to your business's credibility as a whole.

The full text of the statutes can be found below:

(a) Unless otherwise provided in the operating agreement, the management of a limited liability company shall be vested in its members. An operating agreement may provide for the management, in whole or in part, of a limited liability company by one or more managers, who shall hold office and have the duties set forth in the operating agreement. Subject to section thirty-seven, a manager shall cease to be a manager as provided in the operating agreement.
(b) If a limited liability company has at least 1 manager, then unless otherwise provided in the operating agreement, the manager shall manage and control the limited liability company and no member shall manage or control the limited liability company. If a limited liability company has no manager then, unless otherwise provided in the operating agreement, the members shall manage and control the limited liability company.
(c) If a limited liability company has at least 1 manager then, unless otherwise provided in the operating agreement, each manager may execute documents and act for the limited liability company and no member shall execute documents or act for the limited liability company. If a limited liability company has no manager then, unless otherwise provided in the operating agreement, each member may execute documents and act for the limited liability company.
(d) Unless otherwise provided in the operating agreement, a member or manager of a limited liability company may delegate some or all of such member's or manager's rights and powers to execute documents and act for and manage and control the business and affairs of the limited liability company, including delegating to agents and employees of a member or manager of the limited liability company, and delegating by a management agreement or another agreement with, or otherwise to, other persons. Unless otherwise provided in the operating agreement, such delegation by a member or manager of a limited liability company shall not cause the member or manager to cease to be a member or manager, as the case may be, of the limited liability company.

After Creating Your Massachusetts LLC Operating Agreement

Once you have finished your operating agreement, you do not need to file it with your state. Keep it for your records and give copies to the members of your LLC.

Following any major company event, such as adding or losing a member, it is a good idea to review and consider updating the operating agreement. Depending on how your operating agreement is written, it may require some or all of the members to approve an amendment to the document.

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Keep in mind that these operating agreements are meant for reference and should be reviewed by a lawyer.

Frequently Asked Questions

Do I really need an operating agreement?

Yes. Although you won’t file this document with the state, having an operating agreement in place is the best way to maintain control of your Massachusetts LLC in the face of change or chaos.

When should I create my operating agreement?

While it's a good idea to create an operating agreement before filing your Certificate of Formation, the state does not discourage LLCs from waiting until the formation process is complete. It's worth noting that some banks require you to submit an operating agreement in order to open a business bank account.

Do I need to file my operating agreement with the state?

No. Operating agreements are to be retained by the LLC members. There is no need to file your operating agreement with the state.

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