Question: As the owner of an LLC in Wyoming, I would ask what needs to be done to change the ownership. Namely, I would like to donate/transfer the company to a new owner.
Whether you’re selling your LLC or just giving it away, deciding to hand off your company to someone else is a big deal. You’ll want to make sure to properly transfer ownership in order to end your obligations to the company. Otherwise, you might have lingering responsibilities—for example, filing an annual report—to your company.
Luckily, Wyoming is one of the few states that doesn’t require you to provide ownership information to the Secretary of State. To transfer ownership of your LLC, you’ll need to follow the procedures laid out in your LLC operating agreement. Then, you’ll need to update your operating agreement and the IRS with the new ownership information. Here’s how.
Understanding Membership Interest
The owners of a Wyoming LLC are called members. Each member owns a percentage of the LLC, and this is called membership interest. Usually, membership interest is determined by how much a member initially contributed to the LLC. Similarly, members typically profit in proportion to their membership interest—so if you own 50% of the LLC, you get 50% of the profits.
If you’re the only owner of your LLC, you have what’s called a single-member LLC. You own 100% of the membership interest. To transfer ownership of your LLC to someone else, you’ll transfer the entirety of your membership interest.
Following your Operating Agreement
Your Wyoming LLC Operating Agreement is the document that establishes the rules for how your LLC can do, well, almost anything. For example, your operating agreement should specify voting powers, handle disputes, and—yes—transfer membership interest. Your operating agreement is an internal document, kept on record with your company. You don’t need to submit it the Secretary of State.
If you have a Wyoming LLC already, you likely have an operating agreement on file—even if you have a single-member LLC. You’ll need to check your operating agreement to make sure you’re following the rules you agreed to. For example, your operating agreement probably says you need to get unanimous consent from all of your members before you can transfer ownership to someone else.
Updating Your Operating Agreement
If you’re ready to make the change official, you’ll need to update your operating agreement with your new ownership information. The process for updating your operating agreement should be laid out in the operating agreement itself. Typically, you’ll need approval from all members. The operating agreement will need to include the name and signature of your new owner.
Because Wyoming doesn’t require an LLC to list ownership information publicly, it can sometimes be tricky to prove that you own your LLC. The new owner of the LLC can use the updated operating agreement to prove ownership to interested third parties—like a lender or a landlord.
Updating the IRS
Within 60 days of transferring ownership of your LLC, you’ll need to update the IRS on the change. To do so, you’ll file Form 8822-B – Change of Address or Responsible Party. The form just requires some basic information about your LLC—including the name of the new owner or “responsible party.”
What About the Wyoming Secretary of State?
The Wyoming Secretary of State does not require you to list your members on your Articles of Organization. This means that when you change your members, they don’t need to know about it.
There’s one exception to this. If you volunteered to include your member information in your Articles of Organization—on a separate document—you’ll need to update the Wyoming Secretary of State. You have two options for doing so. You can follow either of the following forms:
Filing an Amendment costs $60, but filing the Key Information form is free. Keep in mind that you only need to do this if you included membership information when you initially formed your LLC.