1.- What is a Limited Liability Company with Subsidiaries?
By its initials in English this type of company is called LLC (Limited Liability Company) and in this case it is a Series LLC. In 2009, Texas became the eighth state to allow the formation of these types of companies. The “Series LLC” is a company divided into several (subsidiaries), each with its own assets, members, administrators and obligations.
2.- How can a “Series LLC” help your business and investments?
The purpose of having a company of this nature is to have separate protection for each subsidiary. In other words, each subsidiary is only responsible for its assets without affecting the other and thus have better protection for its business and investments.
3.- How is a “Series LLC” formed in Texas?
A “Series LLC” is formed by sending a “Certificate of Formation” with the Texas Secretary of State, as is the case with any other type of company, the difference is that for a Series certain provisions are specified that in other companies Are not necessary. To create the subsidiary companies, a “Name Certificate” is sent to the Texas Secretary of State and the county in which the business / investment is located.
4.- How is a “LLC Series” taxed ?
At the state level for the purpose of Texas franchise tax, the “LLC Series” and its subsidiaries are declared as a single entity. At the federal level with the IRS, you have the option of filing as a single entity or each independent subsidiary with its own EIN.
5.- What other benefits can a “Series LLC ” offer me?
In Texas, a “Series LLC” will save you time and money. Because instead of having to form each independent business, they all have them on the same umbrella with the flexibility of adding more or closing one without affecting the other. In this way, each subsidiary has its own benefits and responsibilities.