How Long Can an LLC Operate?

Limited liability companies are owned by individual parties called members. LLCs are operated under varying state laws. Generally, members determine the length of time an LLC exists and operates. LLCs may operate for a specific purpose that ends on a certain date, or they may operate indefinitely. All states set forth routine requirements for LLCs to operate in good standing.

Articles of organization must be filed in the state in which an LLC is formed. An LLC may be perpetual, meaning it continually exists without expiration. An LLC is generally presumed to be perpetual and may operate indefinitely unless members state otherwise in the articles.

LLC members may state expiration dates in articles of organization. For example, a company may be formed to undertake a specific task with a deadline, such as completing a building project. Therefore, members may wish for an LLC to discontinue operations and dissolve at a specific time. LLCs automatically cease to legally exist on an expiration date identified in articles of organization.

Members may have operating agreements to set rules and guidelines for LLCs. Operating agreements may identify events that trigger automatic dissolution, such as company losses, or members' retirements. Once an LLC is legally dissolved it generally lacks authority to operate, so events listed in operating agreements may end otherwise perpetual LLCs. Some states, such as New York and Missouri, legally require operating agreements. Other states, such as Arizona, do not require operating agreements.

Each state has its own requirements for creating and maintaining LLCs. For example, in most states resident agents, or in Arizona statutory agents, are named in articles of organization to receive an LLC's legal documents. An LLC's failure to maintain resident agents can result in its automatic dissolution. Many states, such as Michigan, require LLCs to submit yearly filings. LLCs that neglect to follow their state requirements may be automatically dissolved.