Rental Property Investor · Toledo, OH · Member since 2023 · 39 posts · 14 votes
I have been doing a lot of research online while trying to figure out how I am going to restructure my rental business and one thing that has recently been introduced to me is the series LLC. I was going down the path of the hub and spoke model when I found a solution that would essentially solve the biggest issue I was facing. Having so many bank accounts and other administrative extra work.
I am in Ohio where Series LLCs are allowed and this sounds like a really good solution for me. However, the one bank account thing was what many have warned me about. I have read that this is a big no-no in trying to get asset protection. They basically have said this equals an easy piercing of the veil. I am just curious if someone could give a little insight on the series LLCs.
Do you use one?
Are there any major drawbacks compared to setting up multiple individual LLCs?
Do you know of any attorneys who could help me set one up properly?
Attorney · Member since 2022 · 160 posts · 186 votes
3y
Hi Corey,
I cannot speak in detail as to how a Series LLC works in Ohio. The list of States that are allowing the creation of Series LLCs has grown since the entity was first established in Delaware. I am familiar with the Series LLC in some other States, and my guess would be that Ohio has probably followed a similar structure. That said, a common advantage of a Series LLC is that it will have less maintenance than a Hub and spoke structure. The maintenance can be limited to just the Parent Series LLC in some circumstances, meaning that you have multiple Child Series LLCs with only a single registered agent and maintenance that belongs to the Parent Series LLC. I have seen investors successfully use a single bank account under the Parent Series LLC for multiple Child Series LLCs. The separation of the Child Series LLCs occurs in this situation by careful book keeping for each entity.