Because the series LLC is still relatively new in some states, we get a lot of questions about what exactly the series LLC is, and how you can form one. That’s why we decided to write these articles, which break down how the series LLC formation process works in each state.
The series LLC is only available in certain states, including Wisconsin. A series LLC is a collection of LLCs that are grouped under one parent LLC. For the most part, this enables businesses to separate different parts of the company into separate LLCs, allowing them to isolate the liabilities of each segment from the others.
However, the laws in Wisconsin are a bit different, and they call into question whether each LLC is truly shielded from the liabilities of the others. We honestly don’t advise that our readers form series LLCs in Wisconsin due to this issue.
IMPORTANT Note: While the series LLC makes a lot of sense in theory, it certainly has its advantages and disadvantages. We recommend speaking with an attorney before setting up a series LLC in Wisconsin.
That said, if you’re looking for a time-tested way to protect yourself and personal assets as a business owner, the traditional LLC is the way to go. You can either form it yourself or through a free Wisconsin LLC service.
Let’s start by briefly covering what a series LLC actually is. In general, a series LLC is exactly what it sounds like ― it’s a collection of LLCs that operate under the umbrella of a master LLC. While each LLC in the series is part of the larger company, this business structure also keeps each LLC financially insulated from the others. In most states, this means that a lawsuit against one of the LLCs should have no effect on the others in the series.
Each LLC in a series has the same limited liability protections that a standard LLC has, meaning that if you’re sued, creditors can only come after your business assets rather than pursuing your personal possessions. While a series LLC does still protect your personal car, house, bank accounts, etc., it also protects the other LLCs in the series from the lawsuit. In other words, creditors can only pursue the assets of one LLC, rather than the entire series.
However, Wisconsin’s laws do not specifically allow for these liability shields between each individual LLC. While it’s not 100% clear how courts would treat lawsuits against one LLC in the series, it’s quite likely that your separate LLC segments will in fact share liability in this state.
To be perfectly honest, we never advise that our readers form series LLCs in Wisconsin. The way this state set up their laws for series LLCs entirely undermines the point of forming a series LLC in the first place. After all, if your separate LLC segments will have to share liability, there is no reason to form a series LLC.
If you don’t care about your separate LLCs sharing liability, then you can just form one traditional LLC. If you do want your LLCs to have isolated liability, then you should simply form several separate traditional LLCs.
If Wisconsin updates their series LLC laws to make this a more viable business type, we will update this article to reflect that, but for now, there is no good reason for anyone to consider forming a series LLC in Wisconsin.
Please note: At this time, ZenBusiness doesn’t do series LLC formations, but we do offer many other services to help you run and grow your series LLC. We can help you secure an EIN, get a registered agent, and stay compliant. Starting a business doesn’t have to feel like a massive undertaking. Here at ZenBusiness, we tackle the busywork so you can focus on what really matters: your business.
Disclaimer: The content on this page is for informational purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
Wisconsin Business Resources
How to Form a Series LLC
We break down the Series LLC formation process in each state that allows it. View our guides below.
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