How hard is it to change ownership in an LLC?

It depends on the situation. If, for example, you are selling your business by way of selling membership interest to a third party or bringing in investors, the process can require a complex set of documents including a Letter of Intent, Subscription Agreement, and a complex Membership Transfer Agreement. On the other hand, if the transfer is relatively straight forward between 2 people already involved in the business (i.e. you originally specified a 50/50 split and would like to modify to a 60/40 split), the paperwork is much more simple. A simple LLC membership transfer process typically involves the following documents:

1. Authorizing Resolution (we need to make sure the action proposed is properly approved);
2. Membership Transfer Agreement (documents the terms of the transfer);
3. Assignment of Membership Interest (effectuates the transfer);
4. Amend the Company Agreement (the governing document will need to be updated…amending the ownership percentages at a minimum);
5. File a Certificate of Amendment or Restated Certificate of Formation (only when the information in the Certificate of Formation has changed);
6. Update the Responsible Party with the IRS, if applicable;
7. Update the Membership Transfer Ledger; and
8. Issue new Membership Certificates, if applicable.

We can often handle the membership transfer on a flat fee basis. Feel free to reach out to us to discuss your specific situation.