The language of an operating agreement is crucial and often helps determine how member disputes will be resolved and how to transfer ownership of the LLC.
How to Transfer the Ownership of an LLC
Written by: Carolyn Young
Carolyn Young has over 25 years of experience in business in various roles, including bank management, marketing management, and business education.
Reviewed by: Sarah Ruddle
For over 15 years, Sarah Ruddle has been a noteworthy leader in the business and nonprofit world.
Updated on June 8, 2025
One of the most important steps when forming a limited liability company (LLC) is determining who owns it. Fortunately, when it comes to managing your business, LLCs offer great flexibility with minimum requirements in terms of organizational structure.
But what if you suddenly need to transfer your LLC ownership to someone else? Is that possible? It’s a bit complicated but doable – and this guide details how to transfer LLC ownership and when are the best times to do so.
Review Your Operating Agreement
Most states do not require an operating agreement, but it’s a very important document. We highly recommend creating an operating agreement, as it renders significant benefits and advantages:
- Liability protection: Unlike a sole proprietorship, an LLC is a separate entity from its owners or members and thus has its assets and debts. As a result, your assets are protected, which is especially beneficial to LLCs with only one member.
- Transparent organizational structure: A clearly defined management and ownership structure reduce the potential of future issues or disputes related to decision-making or how to execute a process– like transferring ownership.
- Overrides state-default LLC operational rules: LLCs that choose not to create an operating agreement is subject to the state’s default rules in which they’re registered. An operating agreement gives LLC members control over management roles and profit allocations.
An operating agreement should address the following:
- Management structure and member roles
- Each member’s percentage of interest in the LLC
- How to allocate profits and losses to each LLC member
- Rights and responsibilities of each member
- Voting rights of each member
- Rules and protocols for LLC meetings and votes
- Steps to follow when an LLC member:
- Sells their interest
- Leaves the business
- Transfers ownership
- Becomes disabled
- Dies
Here are the steps to take when navigating this process:
1. Understand the Ownership Transfer Provisions
The first step in transferring ownership of an LLC is to carefully review the ownership transfer provisions within your operating agreement. These provisions will detail the specific steps and conditions required for a transfer. Key aspects to consider include:
- Transfer Procedures: Look for a clear outline of the procedures you must follow to initiate a transfer. This might include notifying other members, completing specific forms, or following a formal process outlined in the agreement.
- Eligible Transferees: Identify who can receive ownership interests. Some operating agreements may restrict transfers to certain individuals or entities, such as existing members or family members.
- Valuation Methods: Understand how the value of the ownership interest will be determined. The operating agreement may specify a method for appraising the value, such as through an independent valuation or a predetermined formula.
2. Determine the Consent Requirements
Transferring ownership of an LLC often requires the consent of other members. Your operating agreement will specify the level of consent needed for a transfer to take place. Key points to consider include:
- Unanimous or Majority Consent: Determine whether unanimous consent of all members is required or if a majority vote will suffice. This is crucial as it affects how you approach and negotiate with other members.
- Special Consent Provisions: Be aware of any special provisions that may require consent from specific members or classes of members, particularly if there are different classes of ownership interests.
- Documentation of Consent: Ensure that all consents are properly documented in writing as required by the operating agreement. This documentation may include signed consents, meeting minutes, or resolutions.
3. Review Any Restrictions on Ownership Transfer
Many operating agreements contain restrictions on the transfer of ownership interests to protect the interests of the LLC and its members. These restrictions may include:
- Right of First Refusal: Some agreements include a right of first refusal, which gives existing members the option to purchase the ownership interest before it can be transferred to an outside party.
- Approval by the LLC: There may be provisions requiring the LLC itself to approve the transfer, ensuring that the new owner meets certain criteria or qualifications.
- Prohibited Transfers: Review any outright prohibitions on transfers to certain types of individuals or entities, such as competitors or individuals with conflicting interests.
Approaches for Transferring LLC Ownership
1. The Member Buy-Out
Your operating agreement should define and clearly outline the procedure for transferring ownership via a buy-sell agreement.
When a member leaves the LLC, the buy-sell agreement details what needs to take place to properly and effectively buy them out. Your LLC’s buy-sell agreement should specify the following:
- How to value the departing member’s ownership share or percentage
- Whether the LLC must purchase the departing member’s ownership stake
- How to distribute the remaining ownership units
- LLC members’ process to approve an ownership transfer
Keep in mind that a buy-sell agreement plan detailed in your operating agreement will override your state’s existing member buyout laws and regulations. For instance, some states mandate that the LLC be entirely dissolved, which can be discouraging and complicated.
You can find free operating agreement templates online, but it’s best to have them drawn up or reviewed by an attorney. Creating an operating ag
2. Add a New LLC Member
Your business’s operating agreement should provide detailed information on how to add a new member to the LLC.
During an LLC meeting, all members typically need to agree on any decisions and actions taken on behalf of the business. This extends to any changes made to the LLC’s management and ownership structure and the related implementation process.
Additionally, all members must agree on a protocol to change the LLC’s ownership percentage structure and the corresponding impact on member distributions.
Your business’s operating agreement should detail the process, but LLC members typically vote on adding a new member.
3. Sell Your LLC
If you’ve decided to sell your LLC, this will also require you to transfer ownership. But it’s important to note that in this situation, you won’t find instructions or steps detailing how to conduct the process in your operating agreement.
This is because your operating agreement cannot determine ownership valuations – mainly determined by the market. LLC members will thus need to agree on a price with the buyer and draft a transfer of business ownership agreement, preferably with the advice of an attorney.
Amend and Update Ownership Documents
Once LLC ownership is transferred, it’s essential to go back and amend the associated ownership details provided in the articles of organization filed with the state.
Also, alert the IRS of any change in ownership, and note that the new owner may need to acquire a new tax identification number, or EIN. Every state has its amendment process, so check with your state to ensure you meet the requirements for legal compliance.
If your business is registered in other states as a foreign LLC, you’ll want to review and comply with each state’s amendment process. Be warned that some states prohibit the transfer of ownership.
LLCs registered in states that do not allow the transfer of ownership are usually required to dissolve the business, then the new owner forms a new LLC. In these cases, the buy-sell agreement should address whether the assets of the original owner will be transferred.
How to Transfer the Ownership of an LLC in all 50 States
How to transfer LLC ownership in Alabama
Amend your LLC’s Operating Agreement to reflect the new ownership interests, then file a Certificate of Amendment with the Alabama Secretary of State (online or by mail) and pay the current $100 filing fee. After state approval, update your IRS and internal records accordingly.
How to transfer LLC ownership in Alaska
Execute and record the membership transfer in your Operating Agreement, then file Articles of Amendment (Form 08-463) with the Alaska Division of Corporations (fee $25) to update the public record. Finally, notify the IRS and the Alaska Department of Revenue of the change.
How to transfer LLC ownership in Arizona
Within 30 days of the ownership change, prepare and file Articles of Amendment (Form L015) with the Arizona Corporation Commission—attaching the Member Structure Attachment (Form L041) for member-managed changes—and pay the $25 filing fee. Update your Operating Agreement to match the amended articles.
How to transfer LLC ownership in Arkansas
Pass a resolution authorizing the transfer, amend your Operating Agreement to document the ownership change, then file a Certificate of Amendment to Certificate of Organization (Form LL-02) with the Arkansas Secretary of State (online fee $22.50; paper fee $25). Don’t forget to update your federal tax filings.
How to transfer LLC ownership in California
Amend your Articles of Organization by submitting Form LLC-2 (Amendment to Articles of Organization) to the California Secretary of State (online fee $30; mail fee $45), amend your Operating Agreement to reflect the new member, and file a updated Statement of Information (Form LLC-12) if you change managers or principal addresses.
How to transfer LLC ownership in Colorado
Amend your Operating Agreement to document the new member’s interest, then file an Amendment to Articles of Organization (online via the Colorado SOS) and pay the $25 filing fee. Finally, notify the IRS (e.g., via Form 8822-B if the responsible party changed) and update your internal records.
How to transfer LLC ownership in Connecticut
Execute and record the transfer in your Operating Agreement, then file a Domestic LLC Certificate of Amendment with the Connecticut Secretary of State (online via Business.CT.gov) and pay the $120 fee. After state approval, update the IRS and your company’s records.
How to transfer LLC ownership in Delaware
Review your LLC’s Operating Agreement for transfer protocols, prepare and sign a membership‐interest assignment and amend the Operating Agreement accordingly. Delaware does not require a state‐level filing for member transfers unless you choose to amend your Certificate of Formation.
How to transfer LLC ownership in Florida
Draft and sign the necessary transfer documents (e.g., Operating Agreement amendment, purchase agreement), then file Articles of Amendment with the Florida Division of Corporations and, if applicable, submit a “Resignation or Dissociation of Member or Manager” form. Finally, update your Operating Agreement and internal records.
How to transfer LLC ownership in Georgia
Obtain consent of all members, amend your Operating Agreement to reflect the change, and update your internal records. Georgia does not list members in public filings, so no state‐level filing is required for ownership transfers.
How to transfer LLC ownership in Hawaii
Amend your Operating Agreement to record the incoming member’s interest, then file Form LLC-3 (Amendment to Articles of Organization) with the Hawaii DCCA Business Registration Division (fee $25). Finally, notify the IRS of any change in your LLC’s responsible party using Form 8822-B.
How to transfer LLC ownership in Idaho
Execute and document the transfer in your Operating Agreement, then file an Amendment to Certificate of Organization (Form LLC Amend) with the Idaho SOS (base fee $30 + $20 manual processing). If the LLC’s responsible party changes, file IRS Form 8822-B to update federal records.
How to transfer LLC ownership in Illinois
Membership transfers are governed solely by your Operating Agreement—no Illinois SOS filing is required. Simply execute a membership‐interest assignment, amend the Operating Agreement to reflect the change, and update your internal and IRS records as needed.
How to transfer LLC ownership in Indiana
Amend your Operating Agreement to reflect the new member interests, then file Articles of Amendment with the Indiana Secretary of State via INBiz to update your formation documents. Don’t forget to notify the IRS of any change in your LLC’s responsible party (Form 8822-B).
How to transfer LLC ownership in Iowa
Follow your Operating Agreement’s transfer provisions to document the change in membership interest—if there’s no OA or transfer clause, Iowa law applies. Iowa does not require any Certificate amendment or SOS filing for member transfers; simply amend the OA, update your internal records, and notify the IRS only if you change your tax classification or responsible party.
How to transfer LLC ownership in Kansas
First, amend your Operating Agreement to reflect the new member’s percentage interest. Then file a Certificate of Amendment (Form BEA) with the Kansas Secretary of State (fee varies by filing method) to update your Articles of Organization. Finally, if the “responsible party” changes, file IRS Form 8822-B to update your federal records.
How to transfer LLC ownership in Kentucky
Review and follow your Kentucky LLC’s Operating Agreement transfer provisions (or default state law if none). After member consent, file an Articles of Amendment with the Kentucky Secretary of State (online via Business.CT.gov) and pay the $120 filing fee. Don’t forget to update your tax information with the Kentucky Department of Revenue and, if needed, file IRS Form 8822-B.
How to transfer LLC ownership in Louisiana
Execute the membership‐interest assignment and amend your Operating Agreement accordingly. Then submit the Change of Member(s) and/or Manager(s) form (Form 983A) to the Louisiana Secretary of State (no public member list required) and pay the standard amendment fee. Finally, file IRS Form 8822-B within 60 days if your LLC’s responsible party changes.
How to transfer LLC ownership in Maine
Amend your Operating Agreement to document the transfer. If the change affects your LLC’s name, registered agent, or structure, file a Certificate of Amendment with the Maine Secretary of State (fee $30); for full transfers requiring dissolution, file a Certificate of Cancellation (Form MLLC-7). Update IRS records via Form 8822-B if needed.
How to transfer LLC ownership in Maryland
First, amend your Operating Agreement per Maryland law or your OA’s terms. Then file Articles of Amendment through Maryland Business Express (SDAT) to update your Charter—no special member‐listing requirement—and pay the $100 filing fee. If you dissolve for a full transfer, also file Articles of Dissolution and Articles of Cancellation. Finally, notify the IRS of any change in your responsible party with Form 8822-B.
How to transfer LLC ownership in Massachusetts
Document the membership‐interest assignment and amend your LLC’s Operating Agreement per its transfer provisions. Massachusetts does not require a state‐level filing for internal membership changes unless you also wish to amend your Certificate of Organization—in that case, file a Certificate of Amendment online via the Secretary of the Commonwealth’s e Corp system (fee varies) and update your IRS records if your responsible party changes.
How to transfer LLC ownership in Michigan
Execute the membership‐interest assignment, amend your Operating Agreement, then file a Certificate of Amendment (Form CSCL/CD-715) with the Michigan LARA (fee as published) to update your Articles of Organization. Finally, notify the IRS of any change in your LLC’s responsible party using Form 8822-B.
How to transfer LLC ownership in Minnesota
Record the transfer in your Operating Agreement, then file an Amendment to Articles of Organization through the Minnesota Secretary of State’s Business Filings Online portal (or by mail) to update public records. If your responsible party changes, file IRS Form 8822-B.
How to transfer LLC ownership in Mississippi
Log in at the Mississippi SOS Business Services site, choose File an Amendment on an Existing Business, select the appropriate amendment (e.g. “Change of Members”), provide your LLC’s ID number, pay the standard $25 fee, and submit. Also amend your Operating Agreement and update IRS records as needed.
How to transfer LLC ownership in Missouri
Amend your Operating Agreement to reflect the new member, then file Articles of Amendment on Form LLC-12 with the Missouri Secretary of State (fee $25) to amend your Articles of Organization. Finally, if your responsible party changes, notify the IRS via Form 8822-B.
How to transfer LLC ownership in Montana
Amend your LLC’s Operating Agreement to reflect the new member’s interest, then file an Articles of Organization Amendment with the Montana Secretary of State (online or by mail) to update your public record. Finally, notify the IRS of any change in your LLC’s responsible party via Form 8822-B.
How to transfer LLC ownership in Nebraska
Execute a membership‐interest assignment and amend your Operating Agreement, then file an Amended Certificate of Organization with the Nebraska Secretary of State (fee $30 in-office/$25 online) to officially record the change. Update federal records with IRS Form 8822-B if the responsible party changes.
How to transfer LLC ownership in Nevada
First consult and amend your Operating Agreement per its transfer provisions. Next, file an Amendment to Articles of Organization under NRS 86.221 through SilverFlume (Nevada SOS online portal)—most filings are same-day with no extra fee. Finally, update IRS records via Form 8822-B as needed.
How to transfer LLC ownership in New Hampshire
Document the membership‐interest assignment in your Operating Agreement, then file a Certificate of Amendment to your Certificate of Formation online via the NH SOS eCorp system. After state approval, notify the IRS of any responsible-party change with Form 8822-B.
How to transfer LLC ownership in New Jersey
Amend your Operating Agreement to record the transfer, then complete and submit a Certificate of Amendment (Form DOC11) to the NJ Division of Revenue and Enterprise Services with the $100 filing fee. Finally, file IRS Form 8822-B if the LLC’s responsible party changes.
How to transfer LLC ownership in New Mexico
Amend your Operating Agreement to document the approved member‐interest assignment, then file an Amendment to Articles of Organization with the New Mexico Secretary of State (using the standard amendment form) and pay the current state fee. Finally, if your LLC’s responsible party changes, notify the IRS via Form 8822-B.
How to transfer LLC ownership in New York
First, update your LLC’s Operating Agreement per its transfer provisions. Then file a Certificate of Amendment to your Articles of Organization with the New York Department of State (fee $60) to record the change. If the responsible party on file changes, submit IRS Form 8822-B.
How to transfer LLC ownership in North Carolina
Review and amend your Operating Agreement to reflect the new member interests, then file Articles of Amendment (Form L-17) with the North Carolina Secretary of State (online or by mail) and pay the $50 filing fee. Finally, update IRS records if the responsible party has changed (Form 8822-B).
How to transfer LLC ownership in North Dakota
Amend your Operating Agreement to document the member‐interest transfer, then file Articles of Amendment with the North Dakota Secretary of State (fee $50) to update your Articles of Organization. Notify the IRS via Form 8822-B if your responsible party changes.
How to transfer LLC ownership in Ohio
Amend your Operating Agreement to reflect the transfer, then file a Certificate of Amendment (Form 543A) with the Ohio Secretary of State within 30 days of the change (fee $50). Finally, if your LLC’s responsible party changes, file IRS Form 8822-B.
How to transfer LLC ownership in Oklahoma
Amend your Operating Agreement to document the sale or assignment of membership interests, then file the “Change of Owner – Business Entity” form with the Oklahoma Secretary of State and pay the applicable fee. Finally, update your IRS records if the responsible party or tax classification changes.
How to transfer LLC ownership in Oregon
Execute the transfer per your Operating Agreement, then submit an Articles of Amendment form (available on the Oregon SOS Business Registration Forms page) along with the required fee to the Oregon Secretary of State. Notify any licensing agencies and file IRS Form 8822-B if your LLC’s responsible party changes.
How to transfer LLC ownership in Pennsylvania
Follow your Operating Agreement’s transfer provisions to draft and sign a membership‐interest assignment, then amend the Operating Agreement accordingly. No state‐level filing is required for internal ownership transfers unless you also wish to amend your Certificate of Organization. Update IRS records if needed.
How to transfer LLC ownership in Rhode Island
Carry out the transfer under your Operating Agreement’s buy/sell or assignment provisions and amend the Operating Agreement to reflect the change. Unless you choose to amend your Articles of Organization, no Rhode Island SOS filing is required for member transfers.
How to transfer LLC ownership in South Carolina
Amend your Operating Agreement to record the new member interests, then file Articles of Amendment with the South Carolina Secretary of State using the domestic LLC amendment form and pay the $110 fee. Finally, notify the IRS if your LLC’s responsible party changes.
How to transfer LLC ownership in South Dakota
Amend your Operating Agreement per its transfer provisions, then file Amended Articles of Organization with the South Dakota Secretary of State (online or by mail) to update member records (fees apply). Finally, file IRS Form 8822-B if your responsible party changes.
How to transfer LLC ownership in Tennessee
Follow your Operating Agreement’s transfer provisions, then file Articles of Amendment (Form SS-4451) with the Tennessee Secretary of State (fee $20) to update your Articles of Organization, and update IRS records via Form 8822-B if needed.
How to transfer LLC ownership in Texas
Amend your Operating Agreement to reflect the new member’s interest—Texas SOS does not require a filing for ownership changes—then update any changed registered agent or office information via Form 401 and file IRS Form 8822-B if the responsible party changes.
How to transfer LLC ownership in Utah
Amend your Operating Agreement to document the transfer, then file a Certificate of Organization Amendment ($37 fee) with the Utah Division of Corporations (in person, mail, fax, or email) specifying the LLC name and text of the amendment, and notify the IRS via Form 8822-B if necessary.
How to transfer LLC ownership in Vermont
Document the membership-interest assignment and amend your Operating Agreement, then optionally file a Certificate of Amendment with the Vermont Secretary of State to update your Certificate of Organization (fee applies), and update IRS records if your responsible party changes.
How to transfer LLC ownership in Virginia
Transfer your membership interest per your Operating Agreement and amend the internal records. You do not need to file anything with the Virginia SCC unless you’re changing publicly filed information (e.g., registered agent, principal address, management structure, or company name)—in those cases, file a Certificate of Amendment to your Articles of Organization. Don’t forget to update IRS records if your LLC’s “responsible party” changes.
How to transfer LLC ownership in Washington
Document the transfer in your Operating Agreement, obtain any required member approvals, then file a Certificate of Amendment with the Washington Secretary of State (online via the SOS portal) and pay the current filing fee. Finally, update IRS records (Form 8822-B) if the responsible party changes.
How to transfer LLC ownership in West Virginia
Amend your Operating Agreement to reflect the new member interest, then file the change of ownership amendment online through the West Virginia One Stop Business Portal (select “Change or Transfer of Ownership”) and pay the applicable fee. Notify the IRS via Form 8822-B if your LLC’s responsible party changes.
How to transfer LLC ownership in Wisconsin
Execute the membership‐interest assignment and amend your Operating Agreement per its transfer provisions. Wisconsin does not require any state filing for internal membership transfers—simply update your LLC’s internal records and file IRS Form 8822-B if needed.
How to transfer LLC ownership in Wyoming
Amend your Operating Agreement to record the transfer. Wyoming SOS does not list members in public filings, so no state‐level filing is required unless you’ve voluntarily filed member information—in that case, update it via the “Certificate of Transfer” form. Always notify the IRS of any change in responsible party using Form 8822-B within 60 days.