Your LLC Records Book

So you registered a Limited Liability Company with your state.  Now what?  Now it’s time to maintain an LLC Records Book! Your Records Book keeps the important documents for your business together and accessible. And you’ll need some or all of these documents to open a business bank account, get a bank loan or investors, deal with an IRS audit and more!

I always recommend my clients maintain an LLC Records Book. You can purchase an LLC “kit” from Amazon or most office supply stores – but the fancy kit is entirely unnecessary!  Feel free to use a simple three ring binder with tabs separating the various sections.

So what goes in your LLC Records Book?

1. Your Business Plan

   Hopefully you created this before you set up your LLC.  If not, and you need help with a business plan, check out this blog post.

2. CP575 Notice

   This is the letter from the IRS assigning your EIN

3. Articles or Certificate of Organization

   File the approval from your Department of State in your LLC Records Book.

4. Operating Agreement and any Amendments

   Your operating agreement defines how the business will operate, and lists the members and their ownership interests. In a multi-member LLC, it acts as the partnership agreement.

5. Members and Capital Contributions

   Maintain a list of all present and past members, their last known address, and dates and amounts of capital contributions to the business. Each time a member is added, removed, or makes an additional capital contribution, update this list in your Records Book.

6. Bank Documents

   Include the paperwork you received from your bank when you opened a business bank account. You do not need to keep monthly statements here, just your original documents.

7. Insurance Policies

   Include copies of policies (or at least the declaration page) for your business insurance. Such as general liability, cyberliability, errors & omissions, and any other policies purchased on behalf of the business.

8. Meeting Minutes

   In most states you are not legally required to maintain a records book or meeting minutes for an LLC. But this varies by state law and the terms of your operating agreement. Even if you are not legally required to do so, I advise recording minutes for the big decisions (taking a loan, purchasing property or expensive equipment) you make on behalf of your business (yes, even as a sole member LLC).

9. Annual Reports

   Departments of State require LLC’s to file annual reports. Keep copies of those in your LLC Records book to prove compliance with state requirements.

10. Subchapter S Election

    If/when your business is earning enough money that you want to take advantage of certain tax savings and pay yourself a salary, make an S Corporation election. To accomplish this, file form 2553 with the IRS. Maintain a copy of your filing and a copy of the letter you receive from the IRS accepting your S Corporation election.

11. IRS Correspondence

    Any other documentation received from the IRS.

12. Accountable Plan

    If you are using an accountable plan to claim home office expenses, keep a copy of the resolution adopting the accountable plan in your records book. Make sure your accountable plan meets the minimum requirements of the IRS.

13. Retirement Account Documents

    If you establish a Solo 401k, SEP IRA, or other type of retirement account for which your business is the administrator, include a copy of the original adoption agreement and trust agreement from the investment company.

Having these documents all together and maintaining the records book and your business grows and changes will save you a lot of frantic searching when you need funding, have to deal with the IRS, or want to sell your business.  Do it now!  You’ll thank yourself later!