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Dividing profits in LLC

newCompanynewCompany subscriber Posts: 1
edited July 2009 in Business Planning
we are going to open an LLC. We are 4 people, but we were wondering if it`s possible to have only two owners of the LLC but still being able to equally divide up the profit between the 4 of us. Is this something that can get covered in the operating agreement? or where?
My understanding is that by default the profits are divided by the owners only, unless a salary structure is put in place. So, let`s assume each quarter we have revenue of $10,000, would it be possible to make quarterly payments to EACH of the 4 of us of $2,500, even if there are only 2 owners of the company? or is it possible to divide the profits between 4 people even if 2 are not owners?


  • robertjrobertj subscriber Posts: 0 Member
    In general, when forming a business with others, there are three things to consider:
    1. The ownership (equity) of the business
    2  Direction and control
    3. Distribution of the results.
    One of the advantages of an LLC is that each of the above can be  treated separately. However, to protect all parties and the entity itself- you should have professional assistance to set things up correctly.
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