Hi, I'm Katherine Taylor, the lawyer for business owners. I frequently get asked this question by business owners: Can I use AI to draft an operating agreement for my LLC?

The answer is yes. But then I ask the next question: Should you?

And my answer is no.

Here's why.

AI can be a fantastic tool for business owners. It can help you understand what is required under state law, whether an operating agreement is required at all, what provisions should be included in an operating agreement, and what certain provisions mean. However, AI is not yet advanced enough to think like a lawyer. It cannot fully understand the nuances between state law and the specific goals and needs of the LLC members.

For example, AI may not recognize that the members want a particular process for handling ownership interests if one member dies or becomes incapacitated. It may not understand that management authority needs to be limited, shared, or allocated among different members in a specific way. These are important considerations that can have significant consequences for your business.

In a nutshell, AI tools are great resources. But at this point in time, I do not recommend using AI to draft an operating agreement that you intend to sign and rely upon. If  you want to protect your business, and if you want an operating agreement that truly serves as the constitution for how your business will be governed, it is worth investing the extra time and money to hire an attorney. A lawyer can ensure the agreement is properly drafted, tailored to your business, and aligned with your specific needs and objectives.