Is A Delaware Series LLC A Good Idea?

A Delaware Series LLC can safeguard businesses, corporations and real estate under one business entity or a single name.  With this entity, a company can own property or do business in another state as long as the series LLC is registered in Delaware.  This means there can be separate units of the same company operating under the same LLC no matter where they are located.  One of the benefits of this entity is that when one unit has a liability, it does not affect any of the other units.

However, it is still important that companies have the right kind of liability insurance in case something should go wrong with any unit under the LLC.  Most businesses are usually required to have general liability insurance.  If a client or customer is injured or has his or her property damaged on a commercial property, he or she may sue for damages.  Only the one unit of the LLC will have to deal with the potential legal defense fees and possible payout for damages awarded to a claimant.

Another factor business owners need to consider when looking into a Delaware Series LLC entity is how it can affect other liability insurance claims.  The units under the umbrella LLC may all have different names.  This can be a benefit if one is hit with a liability claim.  It is unlikely that the other units will be associated with the unit facing the liability claim, so they do not have to suffer loses that can likely affect the sister unit.  The larger entity can protect all its economical assets under one roof.

Even though these units are established in Delaware, it is still necessary to consider any local or state regulations for the units that are located outside of Delaware.  You want to be compliant with any laws regarding professional liability insurance, commercial auto insurance, surety bonds or any other kinds of liability that may be required for a business operating within the state.  You also still need to know any information relevant to issues such as interstate commerce if it is related to your particular business.

There are many benefits to having Delaware Series LLC protection.  You can file all income tax returns and pay the filing fees only once for all units under the entity.  You also do not have to create, file or maintain several different LLC’s, which makes it less expensive to maintain your business.  If you are unsure about how to go about creating this entity, you may want to speak with an expert in corporate law or insurance.  With the right help, you can successfully protect all your business units no matter where they are located at a lower rate.

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