All Up In Yo’ Business: Is My LLC Member- Managed or Manager-Managed?

When forming an LLC, one of the things that a business owner, hopefully with the help of an attorney, must decide is whether the LLC should be member-managed or manager-managed. The owners of an LLC are called “members,” and the amount of involvement in the day-to-day operations of the business of each member is going to be the determining factor in whether an LLC is member- or manager-managed.

Member-managed LLC: This is most common. Select this if all of the members (or only you, if you are the sole member) are going to actively participate in the management and operations of the business. Almost all single-member LLCs will be member-managed, at least in the beginning.

Manager-managed LLC: Select this if some of the owners are only investors providing financial support, and are not going to be involved in the day-to-day operations. Or if you are a sole member and you plan on hiring somebody else to take care of the business while you vacation and play golf all day (then call me and tell me what kind of business you are creating, because I want to do it, too).
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