How to Add a Member to Your Montana LLC
It’s common for LLC ownership to change hands, or shift over time. Here’s what you need to know about adding a new member to a Montana LLC:
What is a Montana LLC member?
When it comes to limited liability companies, “member” simply means owner. So if a new person buys an ownership percentage in your company, that new person is considered a member of your Montana LLC. You’ll need to update your internal documents as well as notify the secretary of state.
How do I add a member to my Montana LLC?
Adding a new member to your Montana LLC will require two steps. You’ll need to update your operating agreement and notify the Montana Secretary of State
Update Your Operating Agreement
The first step to adding a new member is to update your Montana LLC Operating Agreement As a legal document customized to fit your company, your operating agreement contains the ins and outs of your LLC, including member names, addresses, and ownership percentages. So, if you add a new member, their information will have to be included in your operating agreement.
Notify the Montana Secretary of State
You’ll also need to update your membership information with the Secretary of State. You can do that one of two ways.
- Add the changes when you file your Montana Annual Report. This document requires that you list all membership information for your LLC. You can report new members when you file this report and it will fulfill your duty.
- If you’ve already filed your annual report, you can make an LLC amendment with the state. There is a $15 fee to complete an online amendment with the state.
How Do I change my MT LLC Operating Agreement?
The procedure for changing your operating agreement should be outlined in the operating agreement itself. As internal documents tailored to fit the needs of an individual company, operating agreements can look different from LLC to LLC. However, the general process for amending an operating agreement usually involves:
- Drafting the amendment
- Holding a meeting with all LLC members
- Putting the proposed amendment up for a vote
- Adopting the amendment (only with majority approval)
If your operating agreement doesn’t include a provision for making amendments, you’ll have to follow the default LLC statutes contained in the Montana Limited Liability Company Act.
Do I need to contact the Montana Secretary of State to add a new member to my Montana LLC?
Yes. You can do this when you file your Annual Report. If you’ve already filed your Annual Report you can file an LLC Amendment with the Secretary of State and this will also fulfill the obligation.
Should I update my Montana LLC member info with the IRS?
It depends on whether or not you have a single-member LLC (SMLLC). If you add a new member to an SMLLC that’s currently being taxed as a “disregarded entity,” your tax status with the IRS will effectively change. Multi-member LLCs can be taxed as a “partnership” or a “corporation”—but not as a “disregarded entity.” So, if you add a new member to an SMLLC, you’ll have to contact the IRS and Apply for a New EIN.
