What are the benefits of a Series LLC?
Benefits of Series LLC’s
- Reduced startup cost.
- Protection of Assets.
- Less Administration.
- Less Complex than Corporation/Subsidiary Structure.
- Lower Sales Tax.
- Only one state registration.
- Only one tax return.
How does a Series LLC work in Illinois?
A series LLC in Illinois is a special type of LLC that provides specific liability and tax benefits to its owners and members. The series LLC consists of a master LLC and one or more individual series that branch off from it.
What are the benefits of an LLC in Illinois?
LLCs have fewer compliance requirements than corporations. LLC earnings aren’t subject to double taxation in the way that C-corporation income is. LLCs can choose to be taxed as a pass-through entity or corporation. Illinois LLCs pay a lower personal property replacement tax than corporations.
Is a Series LLC better than an LLC?
A Series LLC gives you all the same benefits as a regular LLC, but it serves as a sort of “umbrella company” with additional flexibility and protections for multiple companies or lines of business within your overall operation.
Is a series LLC a holding company?
A holding company doesn’t actively operate businesses—it simply exists and owns. As a series LLC, the holding company would own all of the individual series beneath its umbrella. Real estate investors with multiple properties sometimes form series LLCs to isolate liability.
How are series LLCs taxed?
A series organization is not treated as the owner for federal tax purposes of a series or of the assets associated with a series merely because the series organization holds legal title to the assets associated with the series.
Does a Series LLC need its own EIN in Illinois?
Usually, only one tax return is filed for the LLC, to include the net income or loss from each series. However, each series must have its own EIN number and keep separate books and records.
What is the difference between a standard LLC and Series LLC in Illinois?
A Series LLC must first file Articles of Organization with the Illinois Secretary of State (Form LLC-5.5(S)) just as a standard LLC does. The only difference is the filing fee ($400 instead of $150) and an additional provision that must be added to the Series Articles of Organization.
Do LLC pay taxes in Illinois?
For typical LLCs (those not electing to be taxed as corporations) the tax is 1.5% of net income. The tax is payable to the Illinois Department of Revenue (IDOR). Use Form IL-1065 to pay the tax. In some cases, the owners of an LLC choose to have their business treated like a corporation for tax purposes.
What does it mean to establish series LLC?
A series LLC is a unique form of limited liability company (“LLC”) in which the articles of formation specifically allow for unlimited segregation of membership interests, assets, and operations into independent series.
Do series LLC file separate tax returns?
For now, the IRS regards the Series LLC as one big entity. This means, that each series within the structure is not considered a separate company and therefore does not require separate returns. Of course, you will have to declare any income you’ve gained from your Series LLC, and we’ll elaborate on that below.
Can you change an LLC to a Series LLC in Illinois?
In Illinois, a Series LLC needs to be authorize to establish a series. This is done by filing the appropriate Series LLC paperwork with the state. After that is completed, the Master LLC can file a Certificate of Designation. This document allows you to create separate Series LLCs under the Master LLC.
What is a series LLC in Illinois?
Illinois is one of more than a dozen states that allow for the formation of a Series LLC. A Series LLC is a special type of limited liability company consisting of a parent LLC and one or more divisions within itself, called “series,” that can have separate assets, finances, business purposes, and limited liability.
Does an Illinois series LLC need to file annual reports?
Illinois only requires the series LLC to file annual reports, but not all of its cells. In the state of Illinois, if your series or master LLC is in good standing, so are all of its cells.
Do I need an EIN for an Illinois series LLC?
Yes, getting a federal employer identification number (FEIN or EIN) is pretty much a must for any Illinois series LLC. You’ll need an EIN if you’re going to hire employees, take advantage of tax elections like the S corporation, or get Illinois business licenses.
How much does it cost to form an LLC in Illinois?
The state of Illinois, for example, charges $600 to form a regular LLC and $850 for a series LLC. But there is no additional cost for adding more LLCs in the series. 9