How To Form An Llc Holding Company

Create and file articles of organization for each llc with the appropriate state agency.

How to form an llc holding company. This structure is created at the time a business files its articles of organization and allows for the unlimited separation of business interests assets and operations into independent series. Choose separate names for the holding and operating llcs. Starting a holding company as an llc or a corporation is a fairly painless task but you should get the help of an attorney to make sure you do it correctly. For more specific information on how a holding company is taxed be sure to consult a professional with any questions. To set up this business structure you must form two separate llcs within your state.

Form an initial investment strategy. As far as you run the holding and operating companies as different legal bodies the holding company won t be responsible for the debts of the operating company. You have to make each a separate entity but you can be the agent for both. A series llc essentially allows a business to create a holding company structure without having to create separate llcs for each subsidiary. You can start your own investment holding company by forming a strategy and filing the proper paperwork.

Fund the holding company and transfer any existing assets from the operating company to the holding company. You should form an llc to limit your liability. While you can file your llc in your state of residence you also have the option of filing a delaware llc or nevada llc. Forming an llc is relatively simple. The series llc was introduced in 1996 in the state of delaware.

If you need help with forming an llc holding company you can post your legal need on upcounsel s marketplace. If you have a business with a significant amount of assets then a holding company would have a true purpose and would be worth forming one to protect the assets. To fully utilize asset protection an entity can form two llcs one operating company and one holding company. Upcounsel accepts only the top 5 percent of. The member or members choose a name and then file articles of organization with their state of choice for a fee.

A series llc offers the benefits of a traditional llc with one significant difference. You could also create an llc company for each business though this would require you to maintain separate accounting systems and divide up the expenses between each company. As you set up your holding company you will need to find a board of directors to manage the holding company and oversee the subsidiaries. All holding company and operating company assets must be kept separate to ensure your limited liability protection remains intact. How to form your companies.