Series LLC
A Delaware LLC structure that creates internal cells with separate liability protection under 6 Del. C. § 18-215.
Definition
A Delaware Series LLC creates internal series (cells) that have separate assets, members, and liability protection from each other and from the master LLC. Codified at 6 Del. C. § 18-215.
Context
Series LLCs are popular for real estate investors holding multiple properties (one series per property). Use is more limited for service businesses.
Example
A real estate investor holds 5 rental properties in a Delaware Series LLC. Each property is in its own series; a tenant lawsuit against one property cannot reach assets in another series.
Common pitfalls
- Not all US states recognize Series LLC liability separation; risk in foreign-qualification states.
- Federal tax treatment of series is unsettled in some scenarios.
- More complex than standard LLC; requires careful Operating Agreement drafting.