LLC Structure options

by inx
3 replies

I have questions about forming an structure with LLC like parent company and child company, what are my options as far as structures subsidiaries etc. since the parent companies would have other brands.
#llc #options #structure
  • Profile picture of the author Green Moon
    You have a couple of choices of structure.

    One LLC can be the sole member of one or more other LLCs. This is a typical parent/subsidiary structure. Unless the LLCs elect to be treated as corporations, the single member LLCs owned by the parent will all be disregarded entities for Federal income tax purposes but will be separate entities for state corporate law purposes. Each LLC will need to be set up separately and will have its own initial filing fees and annual fees.

    Another choice is to organize the LLCs in a state that permits series LLCs. Depending on the state, that may mean you don't have to file separately for each LLC that is designated as a series LLC or, if additional filing is required it is at a reduced cost both initially and annually thereafter.

    You really need a business attorney to explain the pros and cons of the available structures in your specific situation.
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  • Profile picture of the author scottncp
    I would want to find out more about why you feel you need multiple layers. Not always a bad idea. If you have a main company that will gross $2 million per year with a partner and you know the LLC has the "charging order" protection but you want more protection. You may want you and your partner to have your own LLC as the owner of the operating company to make it more difficult for someone to get after the ownership of the operating company. That is one example. More details would be helpful.

    **Note that this response is purely my opinion and should not be construed as legal advice.**
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  • Profile picture of the author Marketing Fool
    Yeah what he said...a single LLC or corporation can contain all the different brands you don't need to start a whole new legal entity for each brand or project you create...

    And if you did, this wouldn't be the place to get advice about doing to a professional. Either a lawyer who specializes in tax structure or an entreprenurial minded CPA.
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