SEGREGATING ASSETS AND LIABILITY JAY BUTLER
If it looks like a duck, walks like a duck
and quacks like a duck, it’s not a goat. If
your Series LLC is to be respected as
such then your business formalities must
be in order. Take these action steps into
consideration when investigating the use
of a Series LLC.
– Each subsidiary is a separate and
distinct company from the master and
keeps their own respective books and
records.
– Separate EIN (Employer Identification Numbers) are obtained and maintained to segregate bank accounts of
each subsidiary.
–
All
contracts,
agreements,
deeds
and
notes, etc are signed in
the
name
respective
of
the
subsidiary
LLC.
– Each subsidiary name
should include the name
of the master in its title,
thus providing notice or
disclosure
to
the
subsidiary’s existence. i.e.
“Subsidiary, a Series of
(Name of Master) LLC”
– Each subsidiary is to be properly capitalized with no one subsidiary comingling funds or ownership interest in
another.
If each subsidiary is to be treated and respected as a company, with its own legal personality, then it must
behave accordingly.