Can You Have Multiple Businesses Under One LLC?

Running multiple businesses is an exciting opportunity for entrepreneurs looking to diversify and grow their income streams. But can you legally operate these ventures under a single LLC? The answer is yes—if structured properly. Whether you’re expanding into a new market, launching a side hustle, or creating a series of related businesses, consolidating them under one LLC could simplify management and reduce costs.

However, this approach comes with unique risks, from liability exposure to operational complexity. In this guide, we’ll explore how to effectively structure your businesses, weigh the pros and cons, and navigate legal and financial considerations to ensure your ventures thrive.

Can You Have Multiple Businesses Under One LLC?

The short answer is yes—you can operate multiple businesses under one LLC. This approach can simplify management, save costs, and provide a unified legal structure. However, it’s essential to understand the nuances and potential risks before proceeding.

The structure you choose should align with your business goals, risk tolerance, and operational needs.

Whether you’re using a DBA (Doing Business As) name to brand each business separately or exploring alternatives like a Series LLC or holding company, the right setup can protect your assets and streamline your efforts.

Key Structures for Operating Multiple Businesses Under One LLC

1. Using DBAs (Doing Business As)

DBAs, also known as fictitious names, allow you to operate multiple businesses under one LLC while branding them differently. This is particularly useful if your ventures target different audiences or offer unrelated products.

How to Set Up a DBA:

Name Search: Check your state’s database to ensure the desired name is available.
Register the DBA: File the necessary paperwork with your state’s Division of Corporations.
Publication Requirements: Some states require public notice in a local newspaper.
Renewal: Most states require DBA renewal every few years.

Advantages of DBAs:

Low-cost setup and maintenance.
Simplifies operations under a single LLC.
Allows for unique branding for each business.

Disadvantages of DBAs:

Shared liability across all ventures under the LLC.
Doesn’t offer separate legal protections for individual businesses.

2. Series LLCs

A Series LLC allows for separate “series” or divisions within a single LLC, each with its own assets, liabilities, and members. While not available in every state, this structure is an attractive option for managing multiple ventures with liability protection.

Benefits of Series LLCs:

Individual liability protection for each series.
Consolidated management and tax filings.
Efficient for real estate investors or businesses with distinct projects.

Drawbacks of Series LLCs:

Limited availability (not all states permit Series LLCs).
Additional complexity in setup and ongoing management.

3. Holding Companies

A holding company structure involves creating a parent LLC that owns multiple subsidiary LLCs. This setup is ideal for businesses that require robust liability protection and scalability.

How It Works:

The primary LLC (holding company) doesn’t manage day-to-day operations.
Each subsidiary LLC operates independently, safeguarding assets and liabilities.

Advantages of Holding Companies:

Maximum liability protection.
Centralized ownership for strategic control.
Tax benefits through consolidated filings.

Drawbacks of Holding Companies:

Higher administrative costs.
Requires meticulous management of separate entities.

Pros and Cons of Operating Multiple Businesses Under One LLC

Advantages:

Simplified Management: Operating under one LLC reduces administrative tasks like tax filings and compliance.
Cost Savings: Setting up and maintaining a single LLC is cheaper than creating multiple entities.
Brand Flexibility: DBAs allow for diverse branding without creating separate legal structures.

Disadvantages:

Liability Risks: All ventures under the LLC share liability. A lawsuit against one business could affect the entire LLC.
Operational Complexity: Managing finances, taxes, and operations for distinct businesses under one umbrella can become cumbersome.
Investor Concerns: Some investors may hesitate to fund ventures that share liabilities with unrelated businesses.

How to Minimize Risks While Managing Multiple Businesses in One LLC?

Maintain Financial Separation:
Open separate bank accounts for each business to track income and expenses clearly.

Draft a Comprehensive Operating Agreement:
Clearly outline the responsibilities, roles, and financial arrangements for each business within the LLC.

Secure Insurance:
Purchase liability insurance tailored to the risks of each business venture.

Seek Legal and Tax Advice:
Consult professionals to ensure compliance with state laws and optimize tax benefits.

Comparison of Alternatives

When deciding how to structure your businesses, it’s helpful to compare the most common options. Below is a breakdown of key factors to consider:

Structure	Cost	Liability Protection	Management Complexity	Scalability
Single LLC with DBAs	Low	Shared across ventures	Simplified	Moderate
Series LLC	Moderate to High	Separate for each series	Moderate	High
Holding Company	High	Separate for subsidiaries	High	Very High
Independent LLCs	Very High	Separate for each entity	Complex	Very High

Expert Insights and Recommendations

Business attorney Trevor Brewer suggests that the decision to structure multiple businesses under one LLC hinges on two key factors: the similarity of business lines and the increased risks and costs associated with managing multiple companies.

For instance, a real estate investor may benefit from a holding company set up, while a small business owner launching a new product line might find a DBA more practical.

Conclusion

Operating multiple businesses under one LLC is a viable option for many entrepreneurs, but it requires careful planning to balance the benefits with the potential risks. Whether you choose to use DBAs, establish a Series LLC, or create a holding company, understanding the legal and financial implications is essential to your success.

Before making any decisions, consult with a business attorney or tax professional to ensure your structure aligns with your goals and safeguards your assets. With the right approach, you can efficiently manage multiple ventures and set the stage for long-term growth.

Frequently Asked Questions

Q 1. Do I Need to Update My Operating Agreement When Adding New Businesses?

Ans: Yes, updating your LLC’s operating agreement is crucial to clarify the roles, responsibilities, and financial structure of the new business under the LLC.

Q 2. Do I Need Separate Tax IDs for Each Business Under One LLC?

Ans: No, a single LLC typically operates under one EIN (Employer Identification Number). However, consult a tax professional to ensure compliance if your businesses have distinct operations.

Q 3. Can I Protect My Intellectual Property With Multiple Businesses Under One LLC?

Ans: Yes, but it’s recommended to register trademarks and copyrights separately for each business to safeguard their unique identities.

Q 4. Do I Need Separate Bank Accounts for Each Business Under One LLC?

Ans: While not legally required, maintaining separate bank accounts is highly advisable for tracking income and expenses for each business.

Q 5. Can One Business’s Debt Affect the Others Under the Same LLC?

Ans: Yes, since all businesses operate under the same legal entity, creditors can pursue assets across all ventures within the LLC.