Question

your clients are forming a three member LLC each holding a 1/3 interest. One member is to serve as manager. In the operating agreement, the only other statutory default provisions to be overridden are:

(a) advise your clients not to have the tedious consent provisions since they are no longer required for tax classification purposes.

(b) check the provisions of the LLC statute to make sure they can be overridden and then prepare the operating agreement as instructed.

(c) obtain a ruling from the IRS on partnership tax treatment.

(d) suggest forming a sub S corporation where this type of problem should not occur

Answer 1

(a) advise your clients not to have the tedious consent provisions since they are no longer required for tax classification purposes.

LLC or partnership companies have  the requirement that the most important decisions require a unanimous vote. So, part (a) should be overriden because it goes against to the requirements to form a LLC.

The other options (b) (c), and (d) shouldn´t be overriden because they express important steps and advice for the clients.