A parent LLC is a traditional LLC that owns or oversees one, or several other companies. It’s not an entity type, but a term that can be used by multifaceted businesses. Here are some ways to establish a parent LLC:
Create an LLC owned by another LLC
It may sound strange, but you can actually form an LLC owned by another LLC. There are very few restrictions when it comes to LLC ownership. So when you’re filling out your LLC Articles of Organization, and you get to the section that asks you to list an LLC member (or owner), you can list the name of your existing LLC. Your existing LLC, in this case, would be the parent LLC.
Form a Series LLC
Some states offer what’s known as a Series LLC. In such states, you can create one main LLC with several other LLCs attached to it. Your business would functions much the same way it would if you were to form several LLCs owned by one parent LLC. However, the series LLC business model allows you to form the parent LLC and its LLC offspring all at the same time, under the same state filing.
Though there’s often a modest fee for each LLC you add, that cost is usually much cheaper than filing brand new formation papers for each company.
Obtain a DBA for Your LLC
A DBA (Doing Business As) Name isn’t an entity type, but rather a name or brand your company can use instead of its legal name. Some LLCs use DBAs for different branches of their company. For example, if you own a bakery (let’s call it Bakery LLC) and you want to open a bagel shop under another name (say, Bagel Cafe), your company’s legal name would be Bakery LLC and your DBA would be Bagel Cafe.
In this example, all state filings would go through Bakery LLC, so Bakery LLC would be the de facto “parent LLC” of your company.