1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Holding LLC/SubLLC Question PLEASE ANSWER

Discussion in 'Business & Tax Advice' started by Euphorix, Nov 25, 2015.

  1. Euphorix

    Euphorix Supreme Member

    Joined:
    Feb 20, 2015
    Messages:
    1,330
    Likes Received:
    798
    Location:
    Mountain View, CA
    Hi there

    I'm wondering if I have a structure like this

    HOLDING LLC

    LLC A/ LLC B/ LLC C/ LLC D/ LLC E/ LLC F/ and so on

    If LLC(A) fails will the other LLCs be reliable? Will the holding LLC be affected? Or can we just fold LLC(A) and everything else in the structure remains untouched


    I'm asking because I'd like to be able to create a holding LLC, and then use that to create LLCs underneath it for non US clients. I personally will not be running those businesses and I want to make sure that if a client fails the other clients and myself will not be affected. Has to be entirely legal and white hat

    Cheers
     
  2. The Curator

    The Curator Jr. VIP Jr. VIP

    Joined:
    Dec 27, 2013
    Messages:
    991
    Likes Received:
    380
    You can have an LLC, sell it to a foreign person, they just have to make sure they reapply for the business when they own the llc. Taking a look online, every lawyer HIGHLY recommends getting a lawyer to draft up the paperwork so that ALL ties between the old owner and the llc are severed. If one LLC fails, it isn't possible legally for the other ones to be culpable unless they participated (which they haven't) in the same illegality.
    Have a concern that your lawyer didn't sever the tie enough, if risk is what you are trying to remediate, than I suggest looking into an umbrella policy, but if you are just worried about getting your llc banned on ebay it won't happen imo, unless it was registered with ebay first while creating it, THEN ebay might throw a wrench in the system.

    If I was going to spawn off llc's, I would expect my main business to be an S corp
     
  3. JimBean04

    JimBean04 Junior Member

    Joined:
    Mar 13, 2015
    Messages:
    156
    Likes Received:
    49
    No it won't be affected since it's subsidiary
     
  4. bugmaster

    bugmaster BANNED BANNED

    Joined:
    Jun 26, 2014
    Messages:
    109
    Likes Received:
    11
    There should be no issues with this, although as @jbilyj42 Stated you would probably be better off with an umbrella policy, and having the holding company an S Corporation. But the best thing to do would be speak with an attorney that deals with business' and can help you to be sure you are protected.
     
  5. dietsbest

    dietsbest Registered Member

    Joined:
    Dec 3, 2015
    Messages:
    66
    Likes Received:
    9
    Google: Company Trust
    What happens you register a Trust entity and it doesnt have a nominee director under its umbrella you can setup as many companies you want so if one goes bankrupt the trust will not be held responsible. I was looking to set up this kind of Corporation in Panama/Belize but the charges have gone above $5k-8k so just google it and you will get your answer.

    cheers
     
  6. burnett4congress

    burnett4congress Regular Member

    Joined:
    Nov 17, 2011
    Messages:
    401
    Likes Received:
    163
    Depends on what you mean by "fail" and the issues involved. If they are series LLCs then yes the whole thing may be considered a controlled group. There are lots of complexities involved depending on exactly what you're doing.

    Also, if you insist on using LLCs, make sure to file an 8832 to have them treated as c-corps. Unless the foreigner has an ITIN, there is no taxpayer to receive the pass-through. Big tax no-no. But again, this depends on how you are setting things up.