How to Transfer LLC Ownership in Georgia: 2025 Updates


Steve Bennett
Steve Bennett
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Transfer LLC ownership in Georgia

If you have an LLC in Georgia and you wish to discontinue it, you don’t always have to dissolve it. You can transfer the ownership, and it will keep running the way it was. Transferring ownership of a Limited Liability Company (LLC) in Georgia is a relatively simple and straightforward process involving minimal paperwork. It can be partially or fully transferred to another owner.

LLCBuddy editors shared a step-by-step guide on how to transfer ownership of an LLC in Georgia. The steps might seem easy and doable. However, these are general steps and might need special attention for specific cities or regions in Georgia. Hence, it is recommended to consult an attorney or legal expert before taking the steps.

How an LLC Ownership Structure Works in Georgia

By now, you must know that a limited liability company is one of the simplest forms of business structure. The ownership and transferring it to others is even simpler. For an LLC in Georgia or any other state in the United States, the company is considered an independent entity that is separated from its owners, which means the owners are not personally liable for the company’s debts or legal obligations.

The ownership structure of an LLC in Georgia is determined by the percentage of ownership interests held by each member. These ownership interests can be distributed however the members see fit and are typically outlined in the Operating Agreement drafted in Georgia.

There is no maximum limit on the number of members an LLC in Georgia can have, and the members can be individuals, other LLCs, corporations, or even foreign entities. This flexibility allows for a wide range of business structures, from single-member LLCs in Georgia to large, multi-member LLCs with complex ownership arrangements.

What is Georgia LLC Buy-Sell Agreement in Ownership Transfer?

In Georgia, the buy-sell agreement is a part of your operating agreement. It explains the instructions for buying and selling the LLC ownership. For example, who can be the member of Georgia LLC, how will buy out and sell of the LLC be determined, whether the members of the LLC in Georgia will buy the shares of the leaving owner, and how – these are the points you have in the buy-sell agreement. 

Buy Out Georgia LLC or Partial Transfer: In this case, the members of the LLC generally buy the shares of the owner who is leaving. As the LLC buys the owner’s interests, the shares get divided equally among the remaining Georgia LLC members. LLC members must approve the transfer, and then the Operating Agreement (OA) will be updated to exclude the departed owner.

If your LLC operating agreement does not specify these terms beforehand, you must follow Georgia state LLC law. In some states, ownership transfer does not simply take place. Instead, they have to dissolve the LLC to continue with the process. So, while you’re forming an Georgia LLC, make sure to create a buy-sell agreement beforehand.

Sell a Georgia LLC Or Fully Transfer: Selling an LLC or Fully Transferring the ownership is a bit more complicated than the buy-out process. In this condition, owners have the independent legal right to sell the interest to any third party. They do not need other members’ approval for this. The negotiation between the buyer and the seller involves complexities if there is no operating agreement in the first place. As an owner, you must find a buyer, write the change of ownership letter, set out other formalities, and voila! Your ownership transfer is done. The parties will settle the sale contract, including the LLC price, following Georgia state laws.

How to Transfer Georgia LLC Ownership

When an LLC member decides to step down from the owner’s position, they must transfer the ownership to someone else. It can be other existing members of the LLC or a third party. Transferring LLC ownership in Georgia is a common yet complex deed. LLC owners who want to transfer their ownership must follow some steps to do the task. Here are the following steps-

Step 1: Review Your Georgia LLC Operating Agreement

An operating agreement is a kind of non-mandatory document in many states. In Georgia, it is not mandatory to draft one. If you have one at the time of LLC formation in Georgia, then it would be easier for the owners to transfer the name. If not, then it should be filed at the time of transferring ownership. The operating agreement for the LLC in Georgia must be reviewed for the ownership transfer conditions and other legal requirements regarding the buy-out and sale of the LLC.

Step 2: Amend the Georgia Articles of Organization

Changing/transferring ownership might lead to structural change at the managerial level. In that case, the LLCs must comply with the Georgia Secretary of State. To do so, one must file the Georgia Articles of Organization amendment. Specifically in Texas, LLCs must submit a Public Information Report annually to the Texas Comptroller of Public Accounts. The managerial changes will be explained there.

As soon as the ownership transfer negotiation is done and the agreement is made with the updated change of ownership, file it with the Secretary of State. For that, you must amend the Articles of Organization and get the Articles of Amendment. Make the changes to the existing Articles of Organization, get the amendment form, and submit it to the Georgia SOS along with other documents and the filing fee. Read how to amend Georgia Articles of Organization in a simple way.

Step 3: Spread the News

Once the legal formalities are done, and the ownership of your LLC is transferred officially in Georgia, you must spread the word to the clients, partners, and other concerned people. Also, banks and other financial institutions should be notified about the ownership change. Business entities, vendors, and other officials you work with should also be notified. 

Step 4: Obtain a New EIN (optional)

You might need to apply for a new EIN based on the LLC ownership transfer. After officially transferring ownership, you must check with the IRS whether you need a new EIN. There is a formal form to notify the IRS about the LLC ownership transfer. Get the form from their website, enter the details, and submit it. You will get notified whether you need to apply for a new EIN. 

Why Transfer LLC Ownership in Georgia

There can be several reasons why the transfer of LLC ownership in Georgia takes place in any organization. Some of the most common reasons include the following-

  1. Death of the LLC owner
  2. Separation or Divorce of the LLC Owners
  3. LLC owners do not wish to continue their association with the organization
  4. LLC owners want to appoint a new member (owner)
  5. LLC owners want to sell the business off to someone else

These are some of the common reasons why an LLC ownership gets transferred in Georgia. Transferring LLC ownership requires a comprehensive LLC operating agreement in Georgia. This is an internal document every LLC should have at the time of formation. 

The Role of Georgia Operating Agreement in LLC Ownership Transfer

Creating an Operating Agreement in Georgia is one of the major steps in forming a limited liability company (LLC). However, many states do not require an Operating Agreement. California, New York, Delaware, Maine, Nebraska, and Missouri are the states where an LLC operating agreement is mandatory. 

Even when your state does not necessarily need you to file the operating agreement, it is recommended that you should have it to avoid any internal disagreements or issues in the future.

LLCBuddy Editorial Team

An operating agreement is an internal document explaining all the procedures, including ownership transfer, dissolution, LLC operation, members, and other LLC-related processes. Operations, such as dissolution and ownership transfer, occur based on those written regulations. 

If there is no Georgia Operating Agreement or it does not have clear ownership transfer or buy-sell agreement provisions, the transfer takes place based on Georgia state law. 

What to Include in Georgia Operating Agreement

This official document outlines the company’s structure, the members’ details, the dissolution process, and a lot more. Hence, it is always wise to have one to avoid any confusion in the future, whether your state needs it or not. The LLC operating agreement should have the following points-

  • Whether LLC members are related to each other and what type of relationships they share
  • Managers’ rights and responsibilities
  • Operating Agreement Amendment conditions
  • Members’ profit and loss shares
  • Georgia LLC Tax structures
  • Transfer of ownership rules and procedure
  • Dissolution of Georgia LLC

If your operating agreement explains all the above points, you must follow it for the ownership transfer. 

Reasons to Transfer Georgia LLC Ownership

There can be many issues that lead to ownership transfer. One of the most common issues is the death of the owner. There can be other issues where transfer of ownership occurs. Here are some issues to consider, 

Divorce Or End of Marriage:  In some cases, according to the divorce decree, the ownership transfers to the spouse. If the LLC in Georgia has an operating agreement and the ownership transfer condition is specified, then the LLC must follow the Georgia operating agreement to proceed. 

Death of a Member: This is the most common issue in LLCs. In Georgia, if a member dies, the ownership, by default, transfers to the legal heirs of the deceased person. However, in this case, the legal heirs (wife/husband/kids) do not get any managerial power or authority. They continue enjoying the benefits, such as a share of the profit and others. But they won’t get any other power in the company. In such situations, other members of the Georgia LLC often buy out the deceased’s interests. 

Dissolution of Georgia LLC: If any member/owner plans to leave the company, the LLC gets dissolved and reformed with the new policy and operating agreement. The members and managers make this sort of decision at the time of the creation of the operating agreement. 

FAQs

How do I transfer ownership of a Georgia LLC?
To transfer ownership of a Georgia LLC, you typically need to amend the LLC operating agreement and file a transfer of membership interest with the Georgia Secretary of State.
Can the ownership of a Georgia LLC be transferred to someone outside of the state?
Yes, ownership of a Georgia LLC can be transferred to someone outside of the state, as long as the transfer is in accordance with the LLC operating agreement and Georgia state laws.
Is there a fee for transferring ownership of a Georgia LLC?
In Georgia, there is typically a filing fee associated with transferring ownership of an LLC. The exact amount of the fee may vary.
Do I need to notify the Georgia Secretary of State when transferring ownership of a Georgia LLC?
Yes, you are required to notify the Georgia Secretary of State when transferring ownership of a Georgia LLC by filing the necessary paperwork.
Can ownership of a Georgia LLC be transferred to a minor?
In Georgia, ownership of an LLC cannot be transferred to a minor. Any transfer of ownership involving a minor would need to comply with Georgia laws regarding minors and ownership of assets.
How long does it take to transfer ownership of a Georgia LLC?
The time it takes to transfer ownership of a Georgia LLC can vary, but typically it involves amending the operating agreement and filing the necessary paperwork with the Georgia Secretary of State.
Are there any tax implications to consider when transferring ownership of a Georgia LLC?
Yes, there may be tax implications to consider when transferring ownership of a Georgia LLC, such as capital gains tax or gift tax. It is recommended to consult with a tax professional for guidance.
Can a Georgia LLC be transferred without the consent of all members?
Usually, the operating agreement of a Georgia LLC will specify the process for transferring ownership, which may require the consent of all members. It is essential to adhere to the terms of the operating agreement.
Can a member of a Georgia LLC transfer their ownership interest to someone else?
Yes, a member of a Georgia LLC can transfer their ownership interest to someone else, subject to the provisions of the operating agreement and Georgia state law.
What documents are required to transfer ownership of a Georgia LLC?
Some essential documents needed to transfer ownership of a Georgia LLC include a bill of sale, an assignment of membership interest, and any necessary amendments to the operating agreement.
Can ownership of a Georgia LLC be transferred through a will or trust?
Yes, ownership of a Georgia LLC can be transferred through a will or trust, provided that the necessary legal documents designate the transfer of membership interest in the LLC.
What happens if the ownership of a Georgia LLC is transferred without following the proper procedures?
If ownership of a Georgia LLC is transferred without following the proper procedures outlined in the operating agreement and Georgia state laws, the transfer may be deemed invalid, and legal consequences could ensue.
How does a person become the owner of a Georgia LLC?
A person can become the owner of a Georgia LLC by acquiring membership interest from an existing member, either through purchase, gift, or other lawful means, as stipulated in the operating agreement.
Does the Georgia Secretary of State require any specific forms to be filed for LLC ownership transfer?
Yes, the Georgia Secretary of State typically requires specific forms to be filed for LLC ownership transfer, such as a transfer of membership interest form along with any relevant amendments to the operating agreement.
Can ownership of a Georgia LLC be transferred partially, or does it need to be a full transfer?
Ownership of a Georgia LLC can be transferred partially or in part, meaning that a member can transfer a specific percentage or portion of their ownership interest to another person.
Are there any restrictions on who can own a Georgia LLC?
In Georgia, there are generally no restrictions on who can own a Georgia LLC, except for minors and certain disqualified individuals as outlined in state law.
How can I ensure that the transfer of ownership of a Georgia LLC is legally binding?
To ensure that the transfer of ownership of a Georgia LLC is legally binding, it is crucial to follow the procedures outlined in the operating agreement, execute the necessary legal documents, and file the required paperwork with the Georgia Secretary of State.
Can ownership of a Georgia LLC be transferred to a corporation or other business entity?
Yes, ownership of a Georgia LLC can be transferred to a corporation or other business entity, as long as the transfer complies with the operating agreement, Georgia state laws, and any necessary filings are made with the Secretary of State.
What rights does a new owner of a Georgia LLC have?
A new owner of a Georgia LLC typically has the same rights and responsibilities as the previous owner, as outlined in the operating agreement and Georgia state laws governing LLC ownership.
Are there any consequences for not updating the ownership records of a Georgia LLC?
Failure to update the ownership records of a Georgia LLC can lead to legal disputes, challenges in decision-making, and potential liability issues. It is essential to maintain accurate ownership records at all times.
Can ownership of a Georgia LLC be transferred to a non-resident of the state?
Yes, ownership of a Georgia LLC can be transferred to a non-resident of the state, as long as the transfer complies with Georgia state laws and any specific requirements in the operating agreement.
What is the best way to document the transfer of ownership of a Georgia LLC?
The best way to document the transfer of ownership of a Georgia LLC is by drafting a written agreement that clearly outlines the terms of the transfer, obtaining signatures from all relevant parties, and filing the necessary paperwork with the Georgia Secretary of State.
Can a member of a Georgia LLC be forced to transfer their ownership interest?
In most cases, a member of a Georgia LLC cannot be forced to transfer their ownership interest unless otherwise stipulated in the operating agreement or by a court order.
What rights do minority owners have in a Georgia LLC?
Minority owners of a Georgia LLC typically have similar rights as majority owners, as outlined in the operating agreement or state laws. It is essential for all owners to understand their rights and obligations.
Can ownership of a Georgia LLC be transferred without the knowledge of other members?
Ownership of a Georgia LLC cannot usually be transferred without the knowledge of other members, as most operating agreements require notification and agreement from all owners before a transfer can occur.
Can ownership of a Georgia LLC be transferred through a verbal agreement?
It is not advisable to transfer ownership of a Georgia LLC through a verbal agreement. Any transfer of ownership should be documented in writing and executed in accordance with the operating agreement and state laws.
What is the process for transferring ownership of a Georgia LLC if the operating agreement is silent on the issue?
If the operating agreement of a Georgia LLC is silent on the issue of ownership transfer, it is advisable to consult with legal counsel to determine the proper steps to take in accordance with Georgia state laws.
How can I verify the ownership of a Georgia LLC before transferring ownership?
Before transferring ownership of a Georgia LLC, you should review the LLC’s operating agreement, membership certificates, and ownership records to verify the current ownership status and any restrictions on transfer.
Can I transfer ownership of my Georgia LLC?
Yes, ownership of a Georgia LLC can be transferred.
Do I have to notify the state of Georgia when transferring ownership of my LLC?
Yes, you need to update the ownership information with the state of Georgia.

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In Conclusion

As you all know, forming a limited liability company is much easier than forming a corporation, a partnership, or any other type of business. The ease of transferring ownership from one to another is one of the many reasons for entrepreneurs to start an LLC. In Georgia, transferring LLC ownership does not need a lot of paperwork or steps. You must update the formation papers with the new ownership information, file the amendment to the formation document, tell people about it, and comply with the state.

Though it seems easy to file documents while transferring ownership, it could be more complex than just these steps. Based on the local regulations, nature of business, or some other administrative rules, transferring ownership in Georgia might take more than what it looks like. It is recommended to consult a professional or attorney before you take such an important business decision.

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