How to Fund Your LLC the Right Way — 4 Methods Explained

In this video I explain: (i) how to fund your LLC properly, (ii) when, why and how to use each of the 4 methods to fund an LLC; (iii) how to document and record each time you put money into your LLC, and (iv) which LLC funding methods are protected from creditors. I will cover in detail the pros and cons of each funding method for your LLC, along with practical tips so you do it correctly to avoid issues with the IRS and creditors. If you’ve been searching “how to fund my LLC” or wondering whether money going into your LLC should be treated as an initial capital contribution, additional capital contribution, member loan, business loan, or some combination of these, this video is for you. Most LLC owners simply transfer money into the LLC bank account without thinking about how the transfer should be classified. That mistake can affect your books, your ownership percentages, your creditor priority, and even how protected your money is if the LLC is ever sued. In this video, I explain the four main ways to fund your LLC the right way: 1. Initial capital contributions 2. Additional capital contributions 3. Member loans 4. Third-party loans, business credit cards, and lines of credit This is (in my somewhat biased opinion) the clearest and most comprehensive YouTube video tutorial on the topic of funding methods for your LLC. With that said, please let me know if you have any questions or comments! 🔗 Links Mentioned in This Video Operating Agreement / Promissory Note / Next Steps Guide Templates: ✅ https://www.LegalTemplateStore.com Preferred LLC / Business Funding Resource: (ad) ✅ https://go.thellcguide.com/funding Minimum IRS Interest Rates: ✅ https://www.irs.gov/applicable-federa... ✅ Additional LLC Resources My Favorite Business Bank Account for LLCs: ✅ https://www.bluevine.com/partner/thel... How to Pay Yourself from Your LLC: ✅    • How to Pay Yourself as an LLC in 2026 (to ...   Holding Company Structures Explained: ✅    • Why & How to Create LLC Holding Company St...   How to Put Existing LLC Under a Holding Company: ✅    • How to Put an Existing LLC Under a Holding...   Should You Elect S Corp Status? ✅    • S Corp Election Benefits: Save Taxes and M...   📌 Topics Covered: 00:00 How to fund your LLC 00:39 4 ways to put money into an LLC 00:57 Initial capital contributions to fund your LLC 08:03 Additional capital contributions to fund an LLC 13:05 Member loans to your LLC to fund your LLC 17:13 Lending money to your LLC from another LLC 17:55 Securing a member loan with collateral 19:08 Third-party loans, credit cards, and lines of credit to fund an LLC 21:24 Personal guarantees and how to avoid them 22:29 Merchant cash advance warning 24:38 Building LLC business credit 25:07 Who gets paid first if the LLC is sued? 26:18 Capital contributions vs member loans If you found this video helpful, please like the video, subscribe, and leave your LLC questions in the comments. Thanks! If you’d like all my videos properly organized and other useful information about LLC formation, structures and operations all in one place, please visit my website: 🌐 https://www.TheLLCGuide.com If you want to work directly with me to form or structure your LLC(s) or draft contracts, you can contact me through my law firm site at: ➡️ https://www.ChrisJacksonLaw.com Thank you! Best regards, Chris Jackson @TheLLCGuide https://www.thellcguide.com Bio: I have over 30 years of experience as a business attorney with experience as outside counsel, inside counsel and COO. I'm also an entrepreneur who has owned, managed and sold at a significant profit multiple businesses. I created this channel to provide insights that will hopefully help you make money, save money and avoid pitfalls! Legal Disclaimer: Nothing in this video is intended to create an attorney-client relationship. This video, the description above, my answers to questions, and my channel are for general information and entertainment purposes only and should not be construed or relied upon as legal, investment or tax advice. You should not act or rely on any of the information contained herein. For legal or tax advice, please get advice from an attorney and/or CPA authorized to practice in your state. Affiliate Notice: Some of the links in the description, video and/or comments may be affiliate/ad links. If you select those links and purchase something, my LLC may earn a commission at no extra cost to you. I only recommend companies or services I use myself. Any commissions received by my LLC support my channel, and for that I thank you — it is much appreciated! #llc #fundllc #loans #contributions #llcfunding