Texas Series LLC: Risks and Potential Benefits

United States, Corporate/Company Law, The Texas Series LLC: Sophisticated Planning Tool Or Trap For The Unwary? - Giordani, Swanger, Ripp & Phillips, LLP - 24/11/2009, Company Formation, Corporate/Company Law.

Benefits of Series LLCs The main benefit in using the series LLC is the ability to segregate the LLC's assets—whether for purposes of profit sharing, management, liability protection, etc.—without the complexity or expense of setting up multiple entities to achieve the same function. One circumstance in which this benefit can be exploited is the typical structuring implemented in a real estate holding company with multiple properties...
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Uncertainties and Potential Pitfalls The series LLC is a new breed of entity and has only been on the scene since 1996, when Delaware became the first state to adopt series LLC legislation.¹⁴ Illinois, Iowa, Nevada, Oklahoma, Tennessee, and Utah have subsequently adopted their own series LLC legislation. Although the concept has been blessed by the legislatures of these states, there is some risk involved in using the series LLC. For example...