In addition to the standard LLC, Delaware allows businesses to form a “Series LLC.”

A Series LLC has a built in “parent-subsidiary.” structure. When a parent company forms a subsidiary company, the subsidiary company is treated as an entity in its own right. Generally, the subsidiary is responsible for its own acts, and the parent company and other subsidiaries are usually shielded from such acts.

While the “parent-subsidiary” structure can be beneficial, every subsidiary needs to be formed and maintained separately. This means keeping track of different filing dates, filing fees, and other formalities that if not kept may cause the parent-subsidiary structure to fall apart. The Delaware Series LLC addresses this problem by allowing members or managers form internal “series” which are similar to subsidiaries without any further formalities at the state level. This means one filing fee and one filing date, greatly increasing the efficiency of managing a business that may have multiple concerns.

Just like a subsidiary, generally, an LLC is protected from the acts of its series, and each series is protected from the acts of the LLC and other series.

James Hsui, PLLC can assist you in deciding whether forming a Delaware Series LLC is right for you. If so, we can also help you form one.