My answer to How do we structure a company with two founders/partners living in two different states?
Answer by Ken Larson:
Between the two states in which you live. choose the state in which the largest number of potential clients are potentially located which may require face to face contact. Register an LLC in that state and establish the home office there.
In the event it becomes necessary to set up an office with a physical presence in the state in which the business is not registered, register as a foreign (out of state entity).
Many of my clients do business in multiple states without having to register there because they do not have physical presence in those states and work remote or in customer facilities.
I strongly recommend an operating agreement between the two of you. An operating agreement is a separate document, not controlled or required by the state or the federal government but very important to your company.
It should be a simple, straightforward document you and you and your prospective partner(s) can draft yourselves. It should cover such matters as % of ownership, how revenue will be distributed and other general matters, as well as who can commit the company in the form of credit cards, who signs checks on the company account and other administrative matters.
Buying out a partner should also be covered.I have seen many enterprises fail or go through terrifically hard times due to lack of an operating agreement. The parties should sign it after a review by a lawyer.
It should then be notarized and made an official part of the company file.A free sample operating agreement with instructions is at the References file in the Box in the left margin of the following site: