Quick answer
Generally no — in Mississippi, a last will and testament cannot unilaterally override the terms of an LLC operating agreement. A will can attempt to transfer what the decedent owned, but state LLC law and the operating agreement control whether the transferee actually receives full membership rights, only economic rights, or must sell the interest. Always check the LLC’s operating agreement and follow the LLC’s transfer rules; speak with a probate or business attorney for next steps.
Detailed answer: how membership interests, operating agreements, and wills interact in Mississippi
Two different legal regimes can affect a business interest when an owner dies: (1) the LLC’s governing documents and statutory LLC law, and (2) probate law that governs distribution of the decedent’s property under a will. Where they conflict, the LLC’s governing rules typically limit what the will can do.
1. What an “LLC interest” usually means
An LLC interest commonly splits into at least two parts:
- Economic rights — rights to receive distributions, profits, or proceeds.
- Management/membership rights — rights to vote, manage, or be admitted as a member.
Mississippi law and most operating agreements treat these as separable: an assignee (for example the person your will names) often can inherit economic rights but cannot automatically step into management or membership status without following the operating agreement’s admission process.
2. Operating agreements commonly control transfers
Most operating agreements in Mississippi contain transfer restrictions such as:
- no transfer without the consent of other members;
- rights of first refusal or buy‑sell provisions that give the LLC or remaining members the option to buy the interest on defined terms;
- special procedures on death (for example, the decedent’s estate may receive only distributions but not voting rights); and
- valuation formulas or timelines for completing a purchase after a death.
When an operating agreement has these provisions, a will cannot override them. The will can try to pass whatever the decedent legally owned, but the transferee takes subject to the LLC’s transfer rules.
3. What usually happens when a member dies
Common outcomes include:
- The decedent’s beneficiary receives the decedent’s economic interest (right to distributions) but is not admitted as a member and cannot vote or participate in management unless the remaining members consent.
- The operating agreement or state law triggers a buy‑out: the LLC or other members buy the interest from the estate under the agreement’s valuation method.
- If the operating agreement is silent, Mississippi LLC statutes and default rules may apply. If other members must consent to admission, the beneficiary may be limited to an assignable economic interest until consent is given.
4. Where to look in Mississippi law
Mississippi’s statutes and the LLC’s operating agreement together determine the result. For statutory language and to locate the LLC provisions that apply to transfers and rights on death, search the Mississippi Code through the Mississippi Legislature website: https://www.legislature.ms.gov/. For practical business filing and entity information, see the Mississippi Secretary of State: https://www.sos.ms.gov/.
5. Examples (hypothetical)
Example A — Operating agreement contains an explicit buy‑sell at death: Owner’s will leaves LLC interest to son. The operating agreement gives remaining members a right to buy at a set formula within 90 days. Result: son receives payment if members exercise the buy‑sell; son does not become a voting member unless the agreement allows it.
Example B — Operating agreement is silent about death and permits transfer with consent: Owner’s will gives interest to son. The LLC requires current members’ unanimous consent to admit new members. Result: son inherits economic rights but must get member consent to be admitted; otherwise he remains an assignee with only distribution rights.
Practical steps to take if you want your business interest to go to your child
- Obtain a copy of the LLC operating agreement and the LLC’s articles/certificate of formation. Read transfer and death provisions carefully.
- Check for buy‑sell, right of first refusal, valuation methods, and admission rules for new members.
- Talk to the LLC’s manager or other members to learn whether they will consent to your son becoming a member.
- Have an estate or probate attorney advise the executor on how the will interacts with the operating agreement and on necessary notices and timing.
- If you want your son to have managerial rights, consider executing or amending the operating agreement now (with the other members’ consent) to permit a transfer or to pre‑approve admission on death.
- Consider funding mechanisms (life insurance or a designated buy‑out fund) so the family can buy an interest if the operating agreement triggers a mandatory buyout.
- Make sure your will (and any buy‑sell agreement) is coordinated with company documents to avoid post‑death disputes.
Helpful hints
- Do not assume a will automatically makes someone a member. Admission often requires consent under the operating agreement.
- If the operating agreement allows only “assignees,” the beneficiary may be limited to cash distributions and not allowed to vote.
- Act early: amending the operating agreement with consent while you’re alive is the cleanest way to guarantee transfer terms.
- Ask for an appraisal or valuation method in advance so beneficiaries know the likely buy‑out price.
- Keep business records, membership ledgers, and a clear copy of the operating agreement where your executor can find them quickly.
- Coordinate estate planning with business succession planning — separate documents should not conflict.
- Get both an estate/probate lawyer and a business lawyer involved: they play different roles but must work together to implement your wishes.