What Happens to a Florida LLC Interest When a Member Dies?

Section 605.0603(1) explains the effect of dissociation. The person's right to participate as a member in the management and conduct of the company's activities and affairs terminates, and any transferable interest the person owned is owned solely as a transferee.

A transferee has limited rights. Under section 605.0502, a transferee may receive the distributions the member would have received, but may not participate in management and generally has no access to company records.

Section 605.0504 gives the member's legal representative, such as a personal representative, power to exercise all of the member's rights to settle the estate. That includes any power the member had to give a transferee the right to become a member.

An heir or other transferee becomes a full member only in one of the ways listed in section 605.0401(3), such as under the operating agreement or with the consent of all the members.

A single member company raises another issue. Under section 605.0701(3), a company with no members for 90 consecutive days is dissolved, unless transferees owning the rights to a majority of distributions consent to admit at least one specified person as a member and that person becomes a member. Succession planning for company interests is discussed in LLC agreements and probate avoidance.