can an llc own another company [No Fluff]

Last updated : Sept 20, 2022
Written by : Charley Orscheln
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can an llc own another company

Can I create another business under my LLC?

The answer is yes--it is possible and permissible to operate multiple businesses under one LLC. Many entrepreneurs who opt to do this use what is called a "Fictitious Name Statement" or a "DBA" (also known as a "Doing Business As") to operate an additional business under a different name.

How do I own multiple businesses under one LLC?

Another way to structure multiple businesses under one LLC is to set up a holding company. Under this option, you would create separate LLCs for each new business venture and “hold” them under your primary LLC. This arrangement is also referred to as an umbrella company or parent company.

Can a company own another company?

Can a company own a company? Yes, a subsidiary is created when a company owns another company. Creating a subsidiary can be a complicated process that varies depending on the location of the parent company.

Can a LLC have subsidiaries?

An LLC subsidiary can be an excellent way to organize your business. The subsidiary provides a way for your LLC to expand and grow while still maintaining the same organization as the parent company.

Can I use the same EIN number for 2 businesses?

Each one will require a separate, unique EIN. You cannot use the same EIN for multiple businesses, even if they are owned by the same person. EINs are not limited, so you may apply for as many as you need. You are dividing your business into separate entities.

What is it called when you own multiple businesses?

Key Takeaways. A conglomerate is a corporation made up of several different, independent businesses. In a conglomerate, one company owns a controlling stake in smaller companies that each conduct business operations separately. Conglomerates can be created in several ways, including mergers or acquisitions.

Is it better to have multiple LLC or DBA?

Having multiples DBAs will not protect the assets and income of each DBA from the other DBAs. If one of your DBAs gets sued, all other DBAs under the LLC name will be liable. For liability protection purposes, it is better to have multiple LLCs for each of your businesses.

How do I file taxes if I have two businesses?

If you have two businesses, you'll need to file multiple Schedule Cs — one for each business. But, you can include all the forms and calculations with your personal income tax return under your TIN, which distinguishes your sole proprietorship.

Can I have 2 company names?

Can Two Companies Have the Same Name? Yes, however, certain requirements must be met in order for it to not constitutes trademark infringement and to determine which party is the rightful owner of the name. These requirements include: Are the businesses in the same industry or geographic location?

What is it called when a company owns another company?

What Is a Subsidiary? In the corporate world, a subsidiary is a company that belongs to another company, which is usually referred to as the parent company or the holding company. The parent holds a controlling interest in the subsidiary company, meaning it has or controls more than half of its stock.

Can a company own 50% of another company?

A minority stake is ownership or interest of less than 50% of a company. As a majority shareholder, the parent company owns enough of the subsidiary to exercise majority control over it, making decisions such as appointing the board of directors or other important business decisions.

Why is it called a sister company?

Sister companies are subsidiaries that are related to one another by virtue of the fact that they share a common parent entity. Each sister company operates independently from the others, and in most cases, they produce unrelated product lines.

How many LLCs can you have?

Making multiple LLCs, in fact, is perfectly legal; there is no limit to the number of LLCs one person can register. On the other hand, it's more paperwork than you might otherwise need to do. Taxes become individual taxes for each LLC, rather than one larger aggregate whole.

How do I make my LLC a subsidiary?

  1. Choose a name for the LLC subsidiary.
  2. Create the subsidiary's Articles of Organization.
  3. Write a subsidiary Operating Agreement.
  4. Register the subsidiary with the appropriate government agency.

How do you own multiple businesses?

  1. Create Separate LLCs or Corporations. You can create separate LLCs or corporations for each of your businesses, because there's no limit to how many a person can form.
  2. Create Multiple DBAs Under One LLC or Corporation.
  3. Create Businesses Under a Holding Company.

Do I need a new EIN if I start another business?

Generally, businesses need a new EIN when their ownership or structure has changed. Although changing the name of your business does not require you to obtain a new EIN, you may wish to visit the Business Name Change page to find out what actions are required if you change the name of your business.

Can you have multiple DBA under one LLC?

Yes, it is possible for an LLC to operate under more than one DBA at a time. DBAs allow an LLC to use more than one business name without having to form multiple, separate legal entities.

Does a EIN expire?

EINs do not expire. Once an EIN has been issued to an entity, it will not be reissued. An EIN may be applied for: Online—Click on the Employer ID Numbers (EINs) link at

Can you be CEO of 2 companies?

C-suite executives often serve on the board of multiple corporations. Even within a corporation, they may be involved in multiple companies.

How many companies can you own?

First, there's no limit to how many corporations or LLCs one person can form. Many entrepreneurs opt to file a new LLC or corporation for each of their startup ventures. For example, you can form an LLC for your landscaping business and another LLC for the golf course you purchased.

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can an llc own another company

Comment by Humberto Puffinberger

hey everyone Taylor Mathis here the key law girl marketing director in legal assistant at Kate law today I'm going to talk to you guys about a topic that we get asked about a lot and that's about if a parent LLC should own a subsidiary LLC we're gonna go over all of that so be sure to keep watching but before we get into things throw this video a thumbs up be sure to comment with any questions that you guys have and hit that subscribe button or right now we upload new content every week to assist with your legal needs so the question stands should you form a parent LLC to own one or more subsidiary LLC's well honestly it all depends on your risk tolerance and what you're willing to do a parent subsidy entity structure exists when one LLC also known as the parent LLC owns one or more other LLC's the subsidiary LLC's most people understand that maximum asset protection requires that you put one real estate property or one business in an LLC that owns no other property or operates no other businesses everyone knows what happens if you put all your eggs into one basket and then drop the basket you end up losing all your eggs the primary reason to put real estate properties in businesses and separate limited liability companies is so that if a financial problem arises with one property it doesn't affect the value of other properties or businesses there are several disadvantages with owning multiple entities they're obviously expensive to create and operate the administrative burdens such as bookkeeping and tax returns are multiplied and you need separate bank accounts for each entity and multiple entities are more work and cost more than a single entity some people create parent subsidy entity structures to reduce the burdens of owning and operating multiple limited liability companies the parent subsidiary structure exists when multiple these or subsidiaries are owned by a single entity otherwise known as the parent many accountants recommend the parent subsidiary structure to reduce administrative burdens and costs some people create this structure when they own a lot of LLC's that have rental real estate properties and they want to parent LLC that is going to be the property management company the problem with the parent subsidiary structure is that you are taking work carefully and expensively created separate entities that you've formed to maximize asset protection and putting them all in one basket if a creditor Sue's the parent and gets a judgment against the parent the creditor can reach all of the parents non LLC assets the subsidiary LLC's are Arizona LLC's the creditor can only serve a charging order on every subsidiary entity the charging order would require the subsidiary LLC's to make all future distributions of money or property to the creditor instead of the parent LLC you may think that having the risk of a claim brought against the parent is low but it may also not be so let's talk about a real life example here's writing to me a prospective tenant who wants to rent a home owned by LLC 1 and you run a red light and kill computer somebody's you and the parent LLC number 1 will be sued and you and the two LLC's will be liable if the judgment exceeds the parents insurance coverage the creditor will take everything that the parent owns until the judgment is satisfied you're contemplating the parent subsidiary entity structure you will have to decide which is more important to you either maximizing asset protection or minimizing administrative burdens or expenses it really is all up to you and how big of a risk that you are willing to take Oh in one more tip if you do have a parent subsidiary structure make sure that the insurance coverage is adequate the parent and the subsidiary LLC's must all have adequate insurance for their activities so there you have it you now know what a parent-subsidiary entity structure is and you have an idea of if it's a smart move for you to make so go ahead and give this video a like write your comments and questions below and subscribe to our channel for more videos

Thanks for your comment Humberto Puffinberger, have a nice day.
- Charley Orscheln, Staff Member

Comment by Kurtis

are you interested in forming an LLC for your online businesses or business today I'm going to share with you four tips to know how and when you need to form an LLC as a holding company for your online businesses let's do it hi my name is Jim part and the founding attorney here at Hawthorn law and we help small businesses and online entrepreneurs to get their legal house in order so that they can do something that truly matters in the world and today I'm here to share with you four tips that you need to know about to determine when and how you should form an LLC as a holding company for your online businesses and I have to say I'm really excited about today's video because a lot of you in Prior videos have asked me about whether or not I could use a whiteboard you're in for a treat today because I am going to be using a whiteboard as well we're gonna test this out we're gonna see if it works I think it'll work but anyway we're gonna do that today and before we go any further just remember if you haven't already go ahead hit the subscribe button click the bell thingy and and like the video if you like what I'm talking about today's question comes actually from a viewer and today it's from Myles he says could you create a video discussing how to set up a holding company I have a few side hustles that generate income I want to expand what I'm doing so I'm interested in learning how I would approach that I've read that setting up holding company to house the other businesses is a good strategy in terms of legal protection and for filing taxes I've also read it is better it's a better idea to form the holding company prior to creating the other LLC's or whatever structure if possible I'm not sure what's legit and what's nonsense could you broach that topic in a video any guidance or common practices as a starting point would be appreciated Thank You Myles for the question I appreciate it and try and answer that as best I can I'm gonna start by first discussing what a an umbrella LLC also called a holding company LLC is then we're going to talk about the main benefits of forming an LLC as a holding company for your online businesses well touch a little bit on the downsides of forming multiple LLC's and and what can happen if you do that because it's it's not all it's not for everyone I'll be honest but we're gonna talk about that and then we're gonna finish up by talking about when is the best time to form an LLC as a holding company to house all your multiple businesses are you with me on that all right let's jump over to the whiteboard I'm gonna test this out let's do it okay so when we're talking about an LLC we're really talking about here is an umbrella LLC so I know a lot of you been asking for a whiteboard so we're just going to do this is this is LL I'm gonna get used to this here this is the first time we've ever done this the whiteboard so it's kind of cool so this is gonna be a low number number one this is going to be what we call the umbrella LLC and so the box are on that and this is going to be this this LLC right here is going to own all the other LLC's so let's say you've got two other brands that you want to own so this is going to be I'll see you two and this is going to be l.l.c number three okay so this this LLC is actually going to own this LLC and it's going to own this LLC and so what you're going to do is you'll form this LLC first and then you can form these LLC's next and that's basically what an umbrella LLC is so the the member of this LLC is going to be LLC number one and the member of this LLC is going to be LLC number one and there's all sorts of other complicated strategies that can be used but this is the basic idea when we're talking about what is an umbrella LLC all right now we're going to jump into number two which is the main benefits of forming an LLC as a holding company for or your online businesses and there's really two main benefits that we're going to talk about here today and those are liability protection and tax benefits so let's start with the first one liability protection the basic idea here is and a good example of this is if you own rental real estate and a lot of people if I've had clients that owned multiple rental properties and if you own more than one rental property then generally speaking you want to form a separate LLC and also these can be called series LLC's for each of the rental properties you own and the reason for that is let's say somebody gets injured or you know maybe you went to college students and they have a party and somebody gets hurt and that happens in one of your rental properties if you've got all the rental properties in the same LLC and somebody Sue's you for what happened with one rental property then all the other rental properties can be basically attached to a judgment so they can be they're not protected from liability there but if you if you put one rental property in one LLC and another rental property in another LLC and another rental property and another LLC and if somebody Sue's one of those LLC's because they got hurt in that rental property they can't get at the other two or three or four however many rental properties you have because there's a shield of protection in place there I mean we're assuming you're not doing anything to pierce the corporate veil we've talked about that in a prior video but as long as you're not doing that then you your liability is limited to what's in that LLC and the same is true for your online business so if you've got multiple businesses that you're operating under one single holding company you know that the example I like to use is Pat Flynn because he's got a number of businesses now that he's running under the smart passive income brand you know he's got this switch pod and he's got his smart podcast player and he's got his general affiliate and revenue that he makes so he and I don't know what his legal structure is because I'm not affiliated with him at all chances are I suspect he probably has a lawyer and and he probably has different LLC's maybe maybe not Pat if you're watching this you want to reach out I'm happy to help the idea being that you would have a different LLC for each of those unique businesses because if something were to happen with the switch pod player I don't maybe knock yourself over to heaven with your switch Bob player it's not a switch pop players the switch pot switch pot he's got the smart podcast player not to get those confused anyway if you were to like knock yourself over the head with the switch pod or maybe they it swings around and you Jam your knuckles or something I don't I don't know how you can get injured using that but if you did get injured using that then then nobody you can't sue him with the smart podcast player if that makes sense and so if you've got a business if you've got and so if you've got an online business and you have you know you've got you're making some affiliate revenue here and perhaps you've got some courses here and maybe you've got some other digital products here that you're selling or maybe you've got you know an e-commerce business over here

Thanks Kurtis your participation is very much appreciated
- Charley Orscheln

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