Delaware doesn’t require you to file an operating agreement with the state. That’s the rule — and it leads a lot of new LLC owners to skip it entirely.
That’s a mistake. Here’s what an operating agreement actually is, what happens when you don’t have one, and what yours needs to cover.
This is part of our complete Delaware LLC formation guide →
What Is a Delaware LLC Operating Agreement?
An operating agreement is a private legal document that defines how your LLC is owned and operated. It’s an internal document — you don’t file it with Delaware or any other government agency. You keep it with your company records.
Think of it as the rulebook for your LLC. It answers questions like:
- Who owns the company and what percentage does each owner hold?
- How are profits and losses distributed?
- Who has the authority to make decisions on behalf of the company?
- What happens if an owner wants to leave or sell their share?
- What happens if the company needs to be dissolved?
Without an operating agreement, Delaware’s default LLC statutes answer those questions for you — and those defaults were written to cover every possible situation, not your specific one.
Do You Actually Need One?
Yes. Here’s why.
Most banks will request it. Many banks — particularly traditional banks like Chase or Bank of America — will ask for your operating agreement when you open a business account. Some online banking platforms may not require it at account opening, but you’re likely to need it as your business relationship grows, when adding signatories, or when the bank reviews your account.
Investors and partners expect it. If you bring on a co-founder, take on an investor, or sign a significant contract, the other party will want to see your operating agreement before proceeding. It demonstrates that your company has a defined ownership and governance structure.
It protects your limited liability. One of the main reasons to form an LLC is to separate your personal assets from your business liabilities. Courts look at whether your LLC is genuinely operating as a separate legal entity. Having an operating agreement — and following it — strengthens that separation. Not having one is a factor that can work against you if your liability protection is ever challenged.
It prevents disputes. With co-founders or multiple members, the operating agreement is the document you reference when there’s a disagreement about who owns what or who gets to make a decision. Without it, disputes get resolved by Delaware’s default rules or, worse, in court.
What Delaware’s Default Rules Say (And Why They May Not Work for You)
If you don’t have an operating agreement, Delaware’s LLC Act fills in the gaps. Some defaults are reasonable. Others may surprise you.
A few examples of what Delaware defaults to without an operating agreement:
Profit distribution is equal regardless of contribution. If two members put in different amounts of capital or work, Delaware’s default splits profits 50/50 anyway — unless your operating agreement says otherwise.
Any member can bind the company. Without defined authority in an operating agreement, any member can legally enter into contracts or agreements on behalf of the LLC.
Dissolution can be triggered by a single member. Under Delaware’s default rules, a member leaving the company can create dissolution rights. An operating agreement can override this.
These defaults aren’t wrong — they’re just generic. Your operating agreement is where you replace generic with specific.
Single-Member vs. Multi-Member Operating Agreements
The structure of your operating agreement depends on how many people own the LLC.
Single-member LLC (one owner)
If you’re the sole owner, the operating agreement is simpler. It primarily establishes that you are the sole member, defines your management authority, and confirms the separation between you and the business entity.
Even with one owner, you still need it. Most banks will request it. And if your liability protection is ever challenged, the operating agreement is evidence that you’re treating the LLC as a real, separate entity.
Multi-member LLC (two or more owners)
With multiple members, the operating agreement becomes much more important. It needs to cover:
- Each member’s ownership percentage
- Capital contributions (how much each member put in)
- Profit and loss allocation
- Voting rights and decision-making authority
- What happens when a member wants to exit
- How new members can be admitted
- Buy-sell provisions (what happens if a member dies or becomes incapacitated)
Leaving any of these undefined in a multi-member LLC is how business partnerships fall apart badly.
What Your Operating Agreement Should Cover
Whether you have one member or several, a solid operating agreement includes these sections:
Company information — legal name, state of formation, principal place of business, effective date.
Members and ownership — names of all members and their percentage interests. This is the section banks and investors look at first.
Capital contributions — what each member contributed to start the company (cash, property, services).
Profit and loss allocation — how profits and distributions are divided. This can mirror ownership percentages or be structured differently if your situation warrants it.
Management structure — is the LLC member-managed (owners run it directly) or manager-managed (a designated manager runs day-to-day operations)? Most small LLCs are member-managed.
Voting and decision-making — what decisions require a unanimous vote versus a majority? What decisions can any member make independently?
Transfer restrictions — can a member sell or transfer their ownership interest freely, or does the company have the right of first refusal?
Exit and dissolution — what happens when a member leaves or the company winds down?
How to Get One
You have a few options, depending on your situation.
Templates — for a single-member LLC with straightforward ownership, a solid template works. Delaware-specific operating agreement templates are widely available. The important thing is that it’s specific to Delaware and covers the sections listed above.
Formation services — most formation services include a basic operating agreement as part of their package, or offer it as an add-on. The advantage is that it’s already tailored to your specific formation details.
A lawyer — if you have multiple members, complex ownership structures, outside investors, or any situation that’s outside the ordinary, working with a business attorney to draft the operating agreement is worth the cost. Getting it right at the start is considerably cheaper than fixing it later.
At IncReg, operating agreement preparation is available as part of our formation process — drafted to match your specific LLC structure and ready when you need it. Learn more about what’s included →
After You Have One: Keep It Updated
An operating agreement isn’t a one-time document. It needs to stay current.
Update it when:
- Ownership percentages change
- A new member joins
- A member leaves
- The management structure changes
- The company’s purpose or name changes significantly
An outdated operating agreement can create the same problems as not having one — if it says one person owns 50% and they now own 30%, the document is misleading rather than helpful.
Forming from Outside the US?
Non-US founders need an operating agreement for exactly the same reasons as US founders — most banks will request it, partners expect it, and it protects your liability shield.
One additional consideration: if you’re a non-US member of a Delaware LLC with US tax obligations, your operating agreement may need to address how the LLC is treated for tax purposes (as a disregarded entity vs. a partnership). This is worth confirming with a cross-border tax advisor, particularly if there are multiple members.
For a full overview of the costs involved in forming a Delaware LLC as a non-resident, see our Delaware LLC cost breakdown →
Frequently Asked Questions
Is a Delaware LLC operating agreement legally required?
No. Delaware does not require LLCs to file an operating agreement with the state. However, you need one in practice — for banking, investor relationships, liability protection, and dispute resolution.
What happens if my Delaware LLC doesn’t have an operating agreement?
Delaware’s default LLC rules govern your company. These defaults may not reflect your actual ownership structure or intentions — particularly around profit distribution, member authority, and dissolution rights.
Can I use a template for my Delaware LLC operating agreement?
Yes, for a single-member LLC with straightforward ownership, a Delaware-specific template is sufficient. For multi-member LLCs or complex ownership structures, an attorney is recommended.
Does a single-member LLC need an operating agreement?
Yes. Even as the sole owner, you need one for banking purposes, to establish liability separation, and to document that the LLC is operating as a genuine separate entity.
When should I update my operating agreement?
Any time ownership changes, a member joins or leaves, the management structure changes, or the company’s purpose changes significantly. An outdated operating agreement can be as problematic as not having one.
Bottom Line
Delaware doesn’t make you file an operating agreement. You need one anyway.
Without it, many banks will decline to open an account, you can’t bring on partners cleanly, and you’re relying on Delaware’s generic defaults to govern a company that isn’t generic.
It doesn’t have to be complicated. A clear, accurate document that reflects your actual ownership and management structure is what matters.
If you’re forming your Delaware LLC and want the operating agreement handled as part of the process — so you’re ready for the bank on day one — that’s something we take care of at IncReg →
Questions about your Delaware LLC’s operating agreement? [Reach out directly](https://increg.com/contact/) — you’ll hear back from someone who handles this every day.
This article is for informational purposes only and does not constitute legal or tax advice. Consult a qualified attorney or tax professional for advice specific to your situation.