If my business partners and I are about to start an LLC for a restaurant but we also have a couple other businesses, do we have to start an LLC for each one of them?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
If my business partners and I are about to start an LLC for a restaurant but we also have a couple other businesses, do we have to start an LLC for each one of them?
Or is there a way we can have all or most of our business under one LLC?
Asked on January 12, 2016 under Business Law, Minnesota
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
Legally, you may run multiple businesses under one LLC; you also can separate them into different LLCs. It is your choice. There are pros and cons to each option:
ONE LLC, PROS--less cost to set up; ability to flexibly redeploy money, assets, equipment, and personnel from one business to another.
ONE LLC, CONS--if one business incurs substantial liability (e.g. from a loan or lawsuit), *all* the businesses will be affected--much more vulnerable. More complicated to spin off a business if, for example, you want to sell one of the several businesses to someone else.
DIFFERENT LLCS, PROS--much more liability protection; easier to track the expenses and income of each business separately, since they are separate; easier to sell or shut down one business.
DIFFERENT LLCS, CONS--can't use funds, equipment, staff, etc. from one business for another, at least not without more complexity, especially accounting complexity; initially more effort and cost to set up; have to be sure to keep all the different accounts straight.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.