Ohio Single-Member LLC Operating Agreement
Create an Ohio single-member LLC operating agreement with state-specific guidance on the Revised LLC Act, default rules, and asset protection.
Introduction
A single-member LLC operating agreement is the internal document where you, as the sole owner of an Ohio LLC, set the rules for how your business runs and what happens if you bring on a partner or close the business later. Ohio's Revised Limited Liability Company Act (Ohio Revised Code Chapter 1706, effective 2022) treats this document differently for a one-owner company: the statute defines a sole member's operating agreement as a written declaration, not an optional formality you can leave unwritten. Putting your rules in writing is also the clearest evidence, if a court or the IRS ever asks, that you are running a real business rather than using the LLC as a personal wallet.
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Key Things to Know
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Ohio law defines a single-member LLC's operating agreement as a written declaration of the sole member, not an oral or implied agreement, unlike the rule for multi-member LLCs (Ohio Rev. Code Section 1706.01(R)).
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Without an operating agreement, Ohio law splits distributions equally among members rather than in proportion to each member's capital contribution (Ohio Rev. Code Section 1706.29).
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A charging order is the sole and exclusive remedy against a member's LLC interest in Ohio, and the statute extends this protection to single-member LLCs by its plain text, closing a gap Florida's Olmstead ruling once exposed (Ohio Rev. Code Section 1706.342).
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Ohio LLCs owe no annual report and no franchise tax. The only ongoing state tax most LLCs could face is the Commercial Activity Tax, which applies only above $6 million in annual Ohio gross receipts.
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A written operating agreement can expand, narrow, or eliminate a member's or manager's fiduciary duties entirely, but it can never eliminate the implied covenant of good faith and fair dealing (Ohio Rev. Code Section 1706.08).
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The operating agreement itself is not filed with the state. You form the LLC by filing Articles of Organization with the Ohio Secretary of State for a $99 fee.
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Ohio's entire LLC statute changed in 2022: the Ohio Revised Limited Liability Company Act (Chapter 1706) replaced the old Chapter 1705 for every Ohio LLC, regardless of when it was formed, so older guidance citing Chapter 1705 is out of date.
Key decisions before you file
Before you file a LLC Operating Agreement in Ohio, a few decisions shape the document: which option to choose and what each one means. The LLC Operating Agreement guide walks through them.
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Ohio Requirements for LLC Operating Agreement
Formation and Governing Law (Ohio Revised Code Chapter 1706)
The LLC is formed under and governed by the Ohio Revised Limited Liability Company Act, Ohio Revised Code Chapter 1706, effective February 11, 2022, which replaced the former Chapter 1705 for every Ohio LLC regardless of when it was formed. Ohio law does not require the Operating Agreement itself to recite compliance with the Act.
Member-Managed vs. Manager-Managed Structure (Ohio Revised Code Section 1706.30)
An Ohio LLC is member-managed by default: its activities and affairs are under the direction and oversight of its members unless the Operating Agreement designates managers. In a member-managed LLC, ordinary-course matters are decided by a majority of the members, while amending the Operating Agreement or acting outside the ordinary course requires unanimous consent (Ohio Rev. Code Section 1706.30).
Allocation of Profits, Losses, and Distributions (Ohio Revised Code Section 1706.29)
Absent a contrary Operating Agreement provision, Ohio law splits distributions equally among members, regardless of each member's capital contribution or ownership percentage. The Operating Agreement can set a different split (Ohio Rev. Code Section 1706.29).
Voting Rights and Decision-Making (Ohio Revised Code Section 1706.30)
In a member-managed Ohio LLC, a matter in the ordinary course of the LLC's activities may be decided by a majority of the members. An act outside the ordinary course, including amending the Operating Agreement, requires the consent of all members (Ohio Rev. Code Section 1706.30).
Fiduciary Duties (Ohio Revised Code Section 1706.08)
Members and managers owe the LLC and each other a duty of loyalty and a duty of care. Unlike many states, Ohio permits a written Operating Agreement to expand, restrict, or eliminate these duties entirely; the one fixed limit is that the Operating Agreement can never eliminate the implied covenant of good faith and fair dealing, or liability for a bad-faith violation of it (Ohio Rev. Code Section 1706.08).
Indemnification and Liability Limitations (Ohio Revised Code Section 1706.32)
Ohio law broadly authorizes the LLC to indemnify a member, manager, or other person, advance or reimburse their expenses, and maintain insurance on their behalf (Ohio Rev. Code Section 1706.32). The statute does not enumerate specific exceptions to indemnification the way some states do, so the Operating Agreement itself should define any limits the members want to impose.