How To Have Multiple Businesses Under One LLC

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When it involves businesses, not even the sky is that the limit—you can have as many business entities as you would like. But if you’ve got several businesses going, it is often difficult to manage all of them effectively. A method to simplify your businesses is by organizing all of them under one LLC. Done right, this will simplify your legal and financial paperwork, so you’ll specialize in actually running your businesses—but the set-up process can get a touch tricky. Here, we’ve compiled answers to a number of your commonest questions on operating multiple businesses under one LLC roof.

Table of Contents

Use One LLC to Run Both Businesses

One common approach involves having one LLC (usually named for the original/primary business)and then fixing a DBA or multiple DBAs (“Doing Business As,” also referred to as “fictitious name”) for the new venture(s).

As a hypothetical example:

Jonah has an LLC for his auto fix-it shop , “Jonah’s Vehicle Repair and Restoration, LLC.” He now wants to diversify and sell antique car parts online. He might prefer to keep both business lines under his existing business entity but differentiate the new venture by filing the DBA “Back in Time Antique Car Parts and Accessories.”

Can one LLC own other LLCs?

Yes, the most LLC acts as a company for the opposite LLCs.
When you fill out the paperwork to make your LLC, you’d list your main LLC because the sole member of the new LLC. This makes the most LLC the parent, or company , and therefore the new LLC the subsidiary. Technically, you’ll have as many subsidiary LLCs as you would like .

  • With this structure, your main LLC typically doesn’t do any “business” of its own, aside from managing and organizing the opposite LLCs. this is often why it’s referred to as a holding company—it merely holds the others. you would possibly also hear it called an “umbrella company,” because all of the opposite businesses exist under the “umbrella” of the most LLC.
  • An LLC also can be a partner in another LLC, although this gets a touch more complicated. for instance , if you and your brother wanted to open a restaurant and you already owned a restaurant through an LLC, you would possibly make that LLC a partner together with your brother within the other LLC that operates the new restaurant.

Does each LLC need its own tax number?

Maybe, counting on the tax classification you select .

LLCs are created under state law, so you’ll choose whether you would like to possess your LLC treated as an organization for federal tax purposes. If you select to treat your LLC as a “disregarded entity,” meaning that it is not treated as an entity break away its owner, it’d not need an EIN for federal tax purposes. However, your state might require one otherwise you might want to urge one for financial purposes.

  • You’ll still need an EIN if your LLC has employees, albeit it’s treated as a disregarded entity for tax purposes.
  • Any of your LLCs that you simply elect to possess treated as an organization for tax purposes must have their own EIN.

Tips

  • Check registration requirements for each state and county where you use your business. If you use in multiple states, it is a good idea to rent a business attorney to form sure you’re registered everywhere you would like to be.
  • If you are not sure what structure would work for your businesses, ask an accountant. They will run through the financial and tax implications of various structures, so you’ll choose the one that most accurately fits your needs.

Warnings

This text applies to LLCs within the US only. If your LLC is organized during a different country, different regulations might apply. Consult an attorney who focuses on business.

How To Have Multiple Businesses Under One LLC

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