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LLC Owners – What’s in a Title?

LLC owners may not think twice about what title they use for their business, but there are actually a few different titles available to choose from.

Checkout this video:

Overview

Introduction

In business, your title is how you are identified within the company and to the outside world. For example, the president of a corporation is typically known as the “CEO” (chief executive officer), while the owner of a small business might simply be called the “president.” The title you hold within your limited liability company (LLC) can have an impact on how others perceive your role in the business and may affect your ability to raise capital or sell the company down the road.

As the owner of an LLC, you can choose any title you want, as long as it doesn’t imply that you are something you’re not. For example, you can’t call yourself a “licensed professional” if your license has lapsed or if you’re not licensed in that state. In addition, titles that imply control over others in the company, such as “president,” may require that you actually have some employees working for you.

While there are no wrong answers when it comes to what title to use, there are some that may be more advantageous than others. The following is a brief overview of common titles used by LLC owners and what they mean.

Owner/Founder
This is perhaps the simplest and most accurate description of your role in the company. If you are the only member of your LLC, then you are also its sole owner. You can use this title whether or not you have any employees working for you.

Manager
If your LLC is managed by one or more managers (either appointed by the members or elected), then those managers handle the day-to-day operations of the business. As a result, members are not actively involved in running the business and are therefore said to be “passive.” Members may still make high-level decisions about the direction of the company, but they do not handle day-to-day tasks.

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Member
All LLCs have at least one member, which can be an individual person or another business entity. If you are the sole owner of your LLC, then you are also its only member. Members can be actively involved in running the business (in which case they are referred to as “managers”), or they can be passive investors who leave day-to-day tasks to others.

President/CEO/CFO
These titles imply a higher level of responsibility and authority than simply being a member or manager. As a result, they may carry more weight when it comes time to negotiate with partners, investors, or potential buyers. That said, these titles also come with more paperwork and regulatory requirements; for example, companies that use these titles must file annual reports with their state governments detailing their financial performance.

What is an LLC?

An LLC is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation. An LLC is not a corporation, so it does not issue stock or pay corporate taxes. Instead, all profits and losses “pass through” the business to the LLC owners — called members — who report them on their personal income tax returns.

The Importance of Titles

When you create an LLC, you will need to choose a name for your business. This name will appear on all of your official documents, and it will be the name that customers and clients use to identify your company. In addition to selecting a business name, you will also need to choose titles for the LLC’s owners.

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The title that you choose for yourself will appear on the LLC’s Articles of Organization, and it will be the title that you use when conducting business on behalf of the LLC. The title that you choose should reflect your role within the LLC, and it should be a title that you are comfortable using in public.

There are no strict rules about what titles can be used for LLC owners, but there are some general guidelines that you should follow. First, all owners should have a title that reflects their ownership stake in the LLC. For example, if you own 50% of the LLC, your title could be “Managing Member” or “Managing Partner.” If you own 20% of the LLC, your title could be “Member” or “Partner.”

In addition to reflecting your ownership stake, your title should also reflect your role within the LLC. If you are actively involved in running the LLC on a day-to-day basis, your title could be “Manager” or “CEO.” If you are not as involved in the day-to-day operations of the LLC, your title could be “Consultant” or “Advisor.”

Finally, remember that titles are not set in stone. You can change your title at any time, and you can have multiple owners with different titles. The important thing is to choose a title that accurately reflects your role within the LLC and makes you feel comfortable when conducting business on behalf of the company.

How to Choose a Title

No matter what business you are in, choosing the right title is important. The title you choose for your LLC will be seen by potential customers, clients, and vendors, and will be a key part of your brand. It’s important to choose a title that is both descriptive of your business and catchy enough to be memorable.

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Here are some tips for choosing the perfect title for your LLC:

1. Keep it simple: A title that is easy to remember and spells out what you do is best. Avoid acronyms or abbreviations that might not be clear to everyone.

2. Be descriptive: A title that accurately describes what your LLC does is valuable in terms of search engine optimization and helping potential customers find you.

3. Be unique: A title that sets you apart from the competition can be helpful in driving traffic to your website or storefront.

4. Think about the future: A title that can grow with your company as it expands into new markets or product lines is ideal. Avoid titles that are too specific to one product or service.

5. Ask for help: If you’re struggling to come up with the perfect title for your LLC, ask friends, family, or even potential customers for suggestions.

Conclusion

In conclusion, the title of LLC owner is not as simple as it may seem at first. There are many different titles that can be given to an owner, and the decision of which title to use should be made based on the specific goals and objectives of the LLC. When in doubt, it is always best to consult with an experienced attorney to ensure that the proper title is being used.

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*This applies to Virginia residents too!

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