A Series LLC is a business structure and that, of course, means that the right choice for you will depend on your circumstances. That all said, the Series LLC provides a much cheaper solution and a lot of flexibility. It might just be that the Series LLC will be the last business structure you ever need.

There are currently eight states that have Series LLC law (Delaware, Illinois, Iowa, Oklahoma, Nevada, Tennessee, Texas and Utah). If you’re in one of these states, it’s pretty clear what a Series can do for you, and what it can’t do. But if you don’t live in that state, it’s still possible that you might want to use this structure.

So, enough preamble. What really is a Series LLC? It’s a type of Limited Liability Company that takes advantage of some very specific state statutes that allow the LLC to set up an unlimited number of subsidiaries. The subsidiaries can be part of the original business of the original Series LLC, or could be something completely different. When they are set up and run properly, these subsidiaries are considered stand-alone companies that have legal liability protection from the other cells.

The LLC can elect how it wants to be taxed, which makes it the chameleon on the tax world. So, add that with the limitless possibility of a Series LLC, and you’ve got a lot of options.

Do you have a number of investments that you’d like to keep safe? Set each investment up in its own cell. You can roll up the cells into the main Series LLC come tax time and there’s only one return, but otherwise the cells act as their own individual asset protection vehicle.

Need an entity fast? You can set up a cell yourself and be completely operational in less than 2 hours.

Want a lot of privacy? With the exception of Illinois, you don’t have to register the cells of a Series LLC.

Want to cut your entity costs? No registration means no state fees.

Tomorrow I’ll talk about some specifics of the Series LLC for real state investors.