A South Dakota single-member LLC operating agreement is a crucial legal document employed by sole proprietors to establish essential policies and procedures for their business operations. Although optional for operating a business within the state, the absence of this document may lead to severe consequences if faced with adverse legal claims against the Company.

By opting to utilize this document, the owner declares a separation between their financial interests and those of the Company, thereby legally safeguarding their personal and financial assets. Completing and filing this form also offers tax benefits that would be unavailable without it.

Step 1: Company Name 

One of the critical aspects of this process is entering the company name into the operating agreement. Providing the full, legal name of the LLC as registered with the South Dakota Secretary of State is vital to ensure consistency with official records and maintain the LLC’s limited liability protection.

For example, if you are starting an online retail store specializing in eco-friendly products, you could name your LLC “EcoFriendly Market, LLC.” When entering this information in the operating agreement, make sure to use the exact name as it appears on your LLC’s registration with the South Dakota Secretary of State.

Step 2: Agreement Date

First, filling in the blank with the date the operating agreement is being executed establishes the effective date of the contract. This is crucial for creating a clear timeline for the LLC and its operations. The effective date helps to determine the timeline for any future amendments to the operating agreement or legal disputes that may arise. 

For example, if the operating agreement is executed on July 15, 2023, this date would be recorded as the agreement’s effective date.

Step 3: Company and Member Information

Next, enter the full name of the LLC and the full legal name of the sole Member, who is also the managing member of the LLC. This identifies the individual with the legal authority to make decisions on behalf of the Company and solidifies the legal relationship between the Member and the LLC.

For example, if Rachel Doe is the sole Member of “EcoFriendly Market, LLC,” you would write “EcoFriendly Market, LLC” as the Company and “Rachel Doe” as the Member.

Step 4: Formation Date

Insert the full name of your LLC and the date the Articles of Organization were filed with the South Dakota Secretary of State. Including these details in the operating agreement is vital for several reasons. This ensures that the LLC is recognized as a separate legal entity from its owner, which is crucial in maintaining the limited liability protection provided by the LLC structure. This protection minimizes the risk of personal liability for the owner in case of legal disputes or financial issues.

For example, if you have established a business called “EcoFriendly Market, LLC,” and the Articles of Organization were filed with the South Dakota Secretary of State on August 1, 2023, you would insert “EcoFriendly Market, LLC” as the company name and “August 1, 2023” as the filing date in the operating agreement.

Step 5:  Purpose of the Company

Specify the LLC’s core business objective(s) in this blank field. The purpose clarifies the extent of the Company’s activities and aids in avoiding confusion regarding the business’s goals.

The owner of EcoFriendly Market, LLC could describe the purpose of their Company as follows: EcoFriendly Market, LLC is a company dedicated to providing customers with diverse eco-friendly products and services, promoting sustainable and environmentally responsible living. Our mission is to positively impact the environment by offering high-quality, innovative, and eco-conscious products that encourage customers to adopt a more sustainable lifestyle.

Step 6: Authority

In this section, provide the full legal name of the sole Member with the authority to act for or on behalf of the Company. This helps to confirm who is responsible for making decisions and working on the LLC’s behalf.

To continue with our example write Rachel Doe in here.

Step 7: LLC Name

Write the name you chose for your LLC once again here once again. Stating the LLC name again formally connects the business entity to the operating agreement’s terms and conditions. This clearly links the established rules to the named LLC.

Enter EcoFriendly Market, LLC here one more time.

Step 8: Member Signature

At the end of the document, the managing Member should sign and print their name to acknowledge their agreement to the terms outlined within. This helps establish the operating agreement’s legal validity and confirm the Member’s commitment to fulfilling their obligations as outlined.

Rachel Doe signs and prints here name here.



Completing a single member operating agreement is vital for legally forming your South Dakota LLC. Follow the steps above to accurately fill in each blank field, separating your assets from the business, clarifying your authority, and binding yourself to the terms. With a tailored agreement in place, you can operate your LLC with confidence, knowing you have taken key steps to establish policies, limit liability, and set up your business for success.