One would convert from a traditional LLC to a Series LLC if you would like to take advantage of the benefits a Series LLC offers. When you set up your LLC, you will do so in one state, but it's possible to move your LLC to another state should you need to. The Articles of Organization is the legal document that officially creates your Illinois Limited Liability Company. With a Series LLC, your primary LLC will be taxed and as all other are its subsidiaries, you wonât have to pay separate taxes for each one of them. Currently, fourteen states and two non-state jurisdictions have laws governing the formation of Series LLCs, but the Series LLC business model continues to grow in popularity and will likely expand to additional states in the years to ⦠We are unapologetic in our dedication to informing the public and unafraid to call out those who are more focused on profits than peopleâs safety. It is not enough to merely file the amendment to the articles of organization with the Secretary of State. She is a tech junkie and divides her time between travel and writing. Address for Service of Process:_____ _____ 9. The personal assets of its members are protected. Corporation vs. LLC. However, it is not common and I have never done it. Moreover, you will … To convert your Illinois LLC to an Illinois corporation via a statutory merger, you need to: create a new corporation prepare a plan of merger obtain LLC member approval of … This makes it more difficult for a creditor to deny the existence of the series LLC. 7736 or ⦠The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law. Further, Delaware defines a "limited liability company" and a "domestic limited liability company" as "a limited liability company … The process varies by state, depending on whether the jurisdiction recognizes series LLCs. Make checks payable to the Illinois Secretary of State. Over the last few weeks I have converted three Texas limited liability companies to Texas series limited liability companies and I am currently in the process of converting another.. At the June 2013 University of Texas Continuing Legal Education conference on LLCs, LPs, and Partnerships we discussed series … The Series LLC Guide Do Business the Right Way. Another reason to get the Series LLC is to avoid excessive taxation on all of your LLC companies. It will take a few more businesses to make the Series LLC more cost-effective on Secretary of State filing fees alone. a remodeling business that wants to expand into property management); or Reasons to Move Your LLC. 101.601. Rather, it simply is invested with all the legal advantages of being treated as if it were a separate legal entity. To convert, you will need two documents – the Articles of Organization and the Operating Agreement. If you create a Series LLC, you can break your LLC up into smaller units each having their own purpose, members, and liability. If you wish to convert your LLC to a series LLC, a number of legal steps must be taken. After all, a Series LLC … However, there are more differences between the two entities than the way their names are styled. $100 per corporation; $250 per LLC; $250 per Series LLC plus $50 per cell As you can see, if you have 2 businesses the Series LLC … The kinds of activities that would make a Series LLC enticing are: Expanding from one service area to two or more (i.e. The content is not legal advice. For the unfamiliar, a series limited liability company is an LLC that, in essence, has a âmasterâ LLC and one or more individual âseriesâ. California has the highest charges for registering an LLC at $800. In that ruling, the agency addressed the issue of whether an S corporation can convert to an LLC, file an election to retain its tax treatment as a corporation, and also hold onto its S status. Converting Your LLC to Series LLC Even if you operate as an ordinary LLC in one of the states mentioned above, you canât just convert into a series LLC. Illinois is one of only eight states where businesses can establish Series under limited liability companies (âLLCsâ). Again, the requirements vary depending on the jurisdiction. Different states may have slightly different terminology, requirements or fees. You should note that converting your LLC to a Series LLC is not possible if: If that is the case, you can always liquidate your LLC and create a new Series LLC from scratch. Code §18-209(a). $250 per LLC; $250 per Series LLC plus $50 per cell âAs you can see, if you have 2 businesses the Series LLC is already more cost-effective from a Secretary of State perspective than filing 2 LLCs. Legal Reader is devoted to protecting consumers. If your series LLC is to handle real-estate, you may be liable only to pay a single tax for all the units in the series LLC. Here are a list of forms that are available. A series limited liability company, commonly known as a series LLC and sometimes abbreviated as SLLC, is a form of a limited liability company that provides liability protection across multiple "series" each of which is theoretically protected from liabilities arising from the other series. During one of the sessions the speaker ⦠Since the Texas Series LLC was authorized by the 81st Texas Legislature in 2009, subsequent amendments were made to further enhance Texasâs reputation as a state that is amenable to business and recognizes ⦠An LLC, which is recognized as a business entity in every state, provides its owners personal liability protection from business debts and judgments. Answer: As long as your LLC was formed in a state that has Series LLC law (Delaware, Iowa, Illinois… A Series LLC is subject to all of the provisions of the LLC law as a traditional LLC except for those that specifically apply to Series LLCs—such as the recordkeeping and liability limitation provisions. This Act allows Illinois corporation s and unincorporated entities to convert into other entity forms and to domesticate to another state in a simple one-step transaction. In addition, I have converted several limited liability companies to series limited liability companies. This gives Illinois businesses an interesting option. Similarly, in Illinois, the fees for registering an LLC is $500. RESTRICTIONS Distinguishable:The Illinois Limited Liability Company Act provides that you may choose a name so long as it is distinguishable upon the records of the Secretary of Statefrom any domestic or foreign limited liability company name or assumed LLC name, any domestic or foreign corporate name or ⦠Please note the following abbreviations: DE = Delaware, Non-DE = non-Delaware entity, LP = Limited Partnership, LLC = Limited Liability Company, LLP = Limited Liability Partnership, Corp = Corporation… Further, an Illinois series LLC with ten series would save $1,750 in annual filing fees ($750 for series LLC versus $2,500 for separate LLCs), and a series LLC with twenty series would save $3,750 in annual filing fees ($1,250 for series LLC versus $5,000 for separate LLCs). A Series LLC Illinois is an option for new business entities in the state as of 2005, creating a limited liability company that serves as an umbrella for separate companies formed within the Series LLC. under this major LLC are other LLC business structures called series. To form an Illinois LLC you will need to file the Articles of Organization with the Illinois Secretary of State, which costs $150.You can apply online or by mail. A Series LLC files a single annual report and pays a single annual fee. $750 per Series LLC plus $50 per cell Secretary of State Cost for Annual Fees. Question: If I have an existing LLC, can I turn it into a Series LLC? In each of these states, you can file an amendment or other documentation to legally convert your regular LLC into a Series LLC. 1. Itâs not as simple as that. & Chicago’s Responsive Property Manager™ 219 E Irving Park Rd. A limited liability company (LLC) is a convenient way to structure your business, as it offers lots of flexibility and benefits. It’s a new corporate structure that allows entities to separate while remaining … Converting your existing LLC to a series LLC primarily depends on whether your state's LLC laws allow a series LLC. It all depends on the state in which you formed your LLC. Moreover, you will also need a state-issued form that requires the necessary information to complete the process.Â, Once all documents are available, you will have to submit them with the state government.Â. After the original Articles of Organization are filed, each individual LLC is formed using a Certificate of Designation for each LLC within the series. LLC Division at 217-524-8008 to be sure. If you are in any of the following states weâve mentioned above. Alycia Gordan is a freelance writer who loves to read and write articles on healthcare technology, fitness and lifestyle. That amendment states that the LLC is now a series LLC … Over the last few weeks I have converted three Texas limited liability companies to Texas series limited liability companies and I am currently in the process of converting another.. At the June 2013 University of Texas Continuing Legal Education conference on LLCs, LPs, and Partnerships we discussed series LLCs in Texas. If you have separate businesses, youâre ideally suited to convert to a Series LLC. Approximately 17 states in the U.S. allow for the creation of a series Limited Liability Company. This means the other businesses can flourish like they were before. Woods, Erickson, Whitaker and Maurice, LLP: Conversion to a Series LLC, Delaware Division of Corporations: Certificate of Amendment, WebLaws.org: Texas Business Organizations Code Sec. Regular LLCs protect their owners from being liable for actions made by the LLC. The right time to convert your LLC to S Corp From a tax perspective, it makes sense to convert an LLC into an S Corp, when the self-employment tax exceeds the tax burden faced by the S Corp. For some states like Delaware, there is one tax for all the LLCs within the Series LLC.Â. Delaware permits a "domestic limited liability company" to enter into a merger or conversion. More steps means more complications and more opportunities for a mistake to occur. Updated November 25, 2020: Series LLC. Illinois is one of only eight states where businesses can establish Series under limited liability companies (“LLCs”). The decision to convert your LLC into a Series LLC is a tough one.Â, All members of the LLC must make a rational decision after getting advice from legal experts.Â, Converting to a Series LLC is necessary if your business is expanding and offers new services that have their own suppliers and customer bases.Â, With Series LLC registration, all LLCs will have their separate allocation of assets and liabilities and the creation of separate books and accounts.Â. This gives Illinois businesses an interesting option. So, you can form a Series LLC in Texas and then operate it in California as a âForeign LLC.âÂ. However, all assets within the LLC are subject to liability. A series limited liability company, commonly known as a series LLC and sometimes abbreviated as SLLC, is a form of a limited liability company that provides liability protection across multiple "series" each of which is theoretically protected from liabilities arising from the other series. Privacy Policy. Illinois is one of the few states that allows you to form a special type of LLC, known as a "Series LLC." Conversion and Domestication Instead of only permitting the conversion of a partnership or limited partnership to a limited liability company, the Act now provides for the conversion of a general partnership, limited partnership, business trust or corporation into an Illinois LLC… In other states, the process can be much more arduous. Yes, an existing LLC can be converted to a series LLC. Terms of Use and This portion of the site is for informational purposes only. Forming an LLC in Illinois is easy. But when the LLC is divided into multiple LLCs, also known as Series LLC, the other divisions are not affected, and their profits go to the members of the LLC. © LegalZoom.com, Inc. All rights reserved. Illinois Series LLC. When it comes to converting your LLC to a Series LLC yourself, you may want to consult with an attorney or trusted resource to ask about your options. However, before you can create a series LLC, you must be familiar with the rules of the state where your business is based. Audit Proof Your Illinois Series LLC. However, depending on the yearly turnover, some Series LLCs will be required to pay additional tax. While still possible, the process is more complicated if your state does not recognize series LLCs. A Series LLC is subject to all of the provisions of the LLC law as a traditional LLC except for those that specifically apply to Series LLCsâsuch as the recordkeeping and liability limitation provisions. LLC. The state-issued form that must be used to amend an LLC… It also allows entities from other states to convert to Illinois entities and domesticate to Illinois. And finally, you’d have to reintroduce your newly converted Series LLC… A business that starts as an LLC may later need to convert to a C corporation.Although converting to a corporation subjects an LLC to double taxation, some startups must do so to attract investment from venture capital funds or other institutional investors.. Bootstrappers or other founders that are unsure about funding may take the wait-and-see approach to business ⦠Our network attorneys have an average customer rating of 4.8 out of 5 stars. If you want to learn more about the basics of series LLCs, check out our What Is a Series LLC page.. In general, with around $40,000 net income you should consider converting to S Corp. Creating your LLC into a Series LLC is easy. Similarly, the fees for registering an LLC may be formed to own manage. Just a … Updated November 25, 2020: series LLC formation is!, youâre ideally suited to convert to the assets of the way a. 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