Jake Lawson here. I can’t tell you how many confused calls I get about LLC titles. “Am I a manager or a managing member? Can I call myself CEO? What’s the difference between a member and a manager?” After helping over 1,200 entrepreneurs navigate these distinctions, I can tell you it’s simpler than it sounds—once you understand the basic framework. Let me break it all down in plain English.
The Bottom Line Up Front
LLC titles depend on two things: whether you own the company (member) and whether you run it (manager). Your official title for legal documents, bank accounts, and state filings must be accurate, but you can use whatever title you want on business cards and marketing materials.
Here’s the quick reference:
- Member: You own part of the LLC
- Manager: You run the LLC (may or may not own it)
- Managing Member: You both own and run the LLC
Most small business LLCs use “Managing Member” as their official title.
Understanding the Three Core LLC Titles
LLC Member (The Owner)
Simple definition: An LLC Member is an owner of the company.
Think of it like owning stock in a corporation, except instead of shares, you own “membership interests” in the LLC. You might own 100%, 50%, 25%, or any percentage of the company.
What members typically can do:
- Receive distributions (profits)
- Vote on major company decisions
- Review company financial records
- Transfer or sell their ownership interest
What members can’t necessarily do:
- Sign contracts on behalf of the LLC
- Make day-to-day business decisions
- Bind the LLC to agreements
- Handle banking transactions
LLC Manager (The Person in Charge)
Simple definition: An LLC Manager runs the day-to-day operations and has authority to bind the LLC in business dealings.
Managers come in two flavors:
- Internal Manager: Someone who both owns and manages the LLC
- External Manager: Someone hired to manage the LLC who doesn’t own it
What managers can do:
- Sign contracts for the LLC
- Make business decisions
- Open bank accounts
- Hire and fire employees
- Represent the LLC in business dealings
Managing Member (The Owner-Operator)
Simple definition: A Managing Member both owns the LLC and manages its operations.
This is the most common title for small business owners because most entrepreneurs want both ownership and control of their companies.
Why this title matters: It clearly communicates that you have both ownership rights (as a member) and operational authority (as a manager).
Member-Managed vs Manager-Managed: The Key Distinction
This is where people get confused, so let me make it crystal clear:
Member-Managed LLC (Most Common)
- All owners participate in running the business
- Every member can sign contracts and make decisions
- No separate management layer
- Most appropriate title: Managing Member
Example: You and your business partner both own 50% and both work in the business day-to-day. You’re both Managing Members.
Manager-Managed LLC (Less Common)
- Designated managers run the business
- Some owners may be passive investors
- Clear separation between ownership and management
- Titles vary based on role
Example: You own 70%, your silent investor partner owns 30%, and you’re the only one running operations. You’re the Manager, your partner is a Member.
Which Title Should You Use? My Decision Framework
Based on my experience with hundreds of LLCs, here’s how to choose your official title:
Single-Member LLC (You Own 100%)
Recommended title: Managing Member
Why: You’re the only owner and you run the business. This covers all bases.
50/50 Partnership (Both Partners Active)
Recommended title: Managing Member (for both)
Management structure: Member-managed
Why: Both partners own and operate the business.
Active Partner + Silent Investor
Active partner title: Manager
Silent investor title: Member
Management structure: Manager-managed
Why: Clear distinction between who runs things and who just invests.
Professional Management Company
Owner titles: Member
Professional manager title: Manager
Management structure: Manager-managed
Why: Owners hire professional management to run operations.
The Banking and Legal Reality
Here’s what most formation guides don’t tell you: banks and legal documents care about your official LLC title.
For Bank Accounts
Banks want to know who has authority to:
- Open accounts
- Sign checks
- Access online banking
- Apply for business credit
Pro tip: Bring your operating agreement to the bank. It should clearly state who has banking authority.
For Contracts and Legal Documents
When you sign contracts, use your official LLC title. This ensures:
- Legal validity of your signature
- Proper authority to bind the LLC
- Liability protection for the LLC structure
For State Filings
Some states require you to list managers or members on:
- Annual reports
- Amendment forms
- Official correspondence
Use your correct legal title on all state documents.
Marketing Titles vs Legal Titles: What You Can Get Away With
Here’s the part most lawyers won’t tell you: you can use almost any title for marketing purposes.
For Business Cards, Websites, and Marketing:
- CEO
- President
- Founder
- Director
- Principal
For Legal Documents, Banking, and State Filings:
- Member
- Manager
- Managing Member
My approach: Use your legal title for official business, creative titles for marketing.
Example: You’re officially a “Managing Member” but your business card says “Founder & CEO.”
Common Title Scenarios from My Client Experience
Scenario 1: Husband and Wife LLC
Situation: Married couple owns consulting business together
Structure: Member-managed LLC
Titles: Both are Managing Members
Banking: Both have signing authority
Scenario 2: Three-Person Partnership
Situation: Three partners, all active in business
Structure: Member-managed LLC
Titles: All three are Managing Members
Decision-making: Majority vote on major decisions
Scenario 3: Investor + Operator
Situation: One person provides capital, another runs operations
Structure: Manager-managed LLC
Titles: Investor is Member, operator is Manager
Authority: Only manager can bind LLC
Scenario 4: Family Business with Passive Members
Situation: Dad runs business, kids own percentage but aren’t involved
Structure: Manager-managed LLC
Titles: Dad is Manager, kids are Members
Operations: Dad has full operational control
State-Specific Considerations
States That Require Management Disclosure
Some states ask about management structure on formation documents:
- California: Lists managers on Articles of Organization
- New York: Requires management structure disclosure
- Texas: Manager information on Certificate of Formation
States That Don’t Require Disclosure
Other states let you handle this internally:
- Delaware: No management disclosure required
- Wyoming: Handled in operating agreement
- Nevada: Internal management structure
My recommendation: Always create an operating agreement that clearly defines titles and authority, regardless of state requirements.
Changing Titles and Management Structure
Good news: you’re not locked into your initial choice.
How to Change Management Structure:
- Member vote to approve change
- Amend operating agreement to reflect new structure
- Update state filings if required
- Notify banks and update signature cards
Common Reasons for Changes:
- Bringing in passive investors
- Hiring professional management
- Partner leaving the business
- Simplifying complex structures
Tax Implications: Do Titles Matter?
Short answer: No. Your LLC title doesn’t affect tax treatment.
For Tax Purposes:
- Single-member LLC: Taxed as sole proprietorship regardless of title
- Multi-member LLC: Taxed as partnership regardless of management structure
- Corporate election: Available regardless of member vs manager structure
When talking to the IRS: Use “owner” or “partner” rather than LLC-specific titles.
Common Mistakes I See (And How to Avoid Them)
Mistake 1: Using Corporate Titles on Legal Documents
Wrong: Signing contracts as “CEO” when you’re actually a Managing Member
Right: Use your official LLC title for all legal documents
Mistake 2: Unclear Authority in Operating Agreements
Problem: Operating agreement doesn’t specify who can sign contracts
Solution: Clearly define each person’s authority and limitations
Mistake 3: Inconsistent Titles Across Documents
Problem: Different titles on state filings, bank documents, and contracts
Solution: Pick official titles and use them consistently
Mistake 4: No Operating Agreement
Problem: Relying on state default rules for management structure
Solution: Create operating agreement that defines roles and titles clearly
Professional Services: When You Need Help
Hire an Attorney When:
- Complex ownership structures with multiple classes of members
- Professional management arrangements with extensive authority
- Dispute resolution mechanisms needed in operating agreement
- Estate planning considerations for member interests
Work with an Accountant When:
- Tax elections might change based on management structure
- Multi-state operations with varying compliance requirements
- Payroll considerations for manager vs member compensation
Frequently Asked Questions
“Can I be both a member and a manager?”
Absolutely. This is called a Managing Member, and it’s the most common arrangement for small business LLCs.
“What if I want to use ‘CEO’ as my title?”
Use it for marketing, but stick to LLC titles for legal documents. You can be “Managing Member” on state filings and “CEO” on your business cards.
“Do I need different titles if I have multiple LLCs?”
Each LLC is separate. You might be Managing Member of one LLC and just Member of another, depending on your role in each.
“Can a corporation be a member of an LLC?”
Yes. Corporations, other LLCs, partnerships, and trusts can all be LLC members. The managing entity would be the Manager.
“What if members disagree on who should be manager?”
Your operating agreement should address this. Common solutions include majority vote, unanimous consent requirements, or pre-designated management terms.
“Can I change my title without other members’ approval?”
No. Title changes that affect authority require member approval according to your operating agreement.
The Bottom Line: Keep It Simple and Legal
For most small business LLCs, the choice is straightforward:
Single-member LLC: You’re the Managing Member
Active partnership: Everyone’s a Managing Member
Passive investors involved: Use Manager-managed structure
My general rule: Start with member-managed and Managing Member titles unless you have specific reasons for complexity. You can always change later as your business evolves.
The key is understanding that your official LLC title affects your legal authority and responsibilities. Get this right in your operating agreement, use correct titles on official documents, and then feel free to be creative with marketing titles.
Remember: LLC titles might seem like just paperwork, but they determine who can legally bind your company and make important business decisions. Take the time to get this right from the beginning—it’ll save you headaches and legal complications down the road.
Need help determining the right management structure and titles for your specific LLC situation? I’ve guided over 1,200 entrepreneurs through these decisions, and every business has unique considerations. The goal is choosing titles and structures that fit your operational needs and growth plans, not just copying what others do. Get the foundation right, and everything else becomes much easier.