Yes. In Illinois, it is possible to create a Series LLC. A Series LLC allows a business owner to create multiple LLC’s with separate liabilities without having to individually register and pay for each LLC.
Benefits of a Series LLC
There are many benefits to creating a Series LLC. A business owner who offers multiple services could divide each of the services into a separate series, with separate assets. For example, real estate developers often create Series LLC’s. They create the series with a holding company, and then file a separate certificate of designation for each property they own. This way, if there is a problem with one of the properties, the assets of the other properties are not at risk. In other words, the liabilities of the properties are separate. This can be done with multiple types of businesses where it is possible to split the different services they provide.
Another benefit to creating a Series LLC is the cost-savings. If it was not possible to create a Series LLC, a business owner would have to create a separate full-scale LLC for each business he or she wanted to create, with a separate $500 filing fee and a separate annual fee for each.
With a Series LLC, the upfront costs are a little higher, but the long-term savings are clear. It is $750 to register to designate a Series LLC, more than the normal $500 fee to register a normal LLC. However, once a Series LLC is created, the fee for filing Certificates of Designation to create a new series within the Series LLC is only $50. And there is only one annual filing fee for all of the LLC’s in the series each year.
After a forming a Series LLC, a business owner must be careful to keep each series separate. Separate books and records must be kept for each LLC in the series. Each series should have separate bank accounts. Any assets should be solely owned by one LLC in the series – two or more series should not co-own the same property. Transactions between the properties should be handled at arms-length.
If you own or manage multiple businesses, a Series LLC might be a good option to protect the liabilities and to save money.
Contact G & G Law, LLC today to for a free consultation on how to organize a Series LLC.