Converting standard LLC to Series LLC in Texas

[sangeetmona]

1) Does anyone know the procedure to convert a standard LLC to Series LLC in Texas ?

Regards

Sangeet

[Carl]

This is more of a legal question and not a tax question. Not all states provide for a Series LLC (Texas does), and the laws on this can differ among states that do allow this. I would suggest you seek the services of a Business Attorney or other legal professional in Texas that is well versed in this.

[sangeetmona]

THANKS

[tagteam]

@sangeetmona 

See https://www.sos.state.tx.us/corp/formationfaqs.shtml#LLC2

You should be able to amend your LLC filing, but professional assistance is recommended.

[Rick19744]

I will add a couple of comments:

• I also agree that you get professional assistance so you understand the tax and legal implications.
• Make sure the operating agreement allows for the Series LLC
• There are numerous "less than clear" open questions in this area.  
• While the current federal treatment is filing a single "master" LLC tax return, make sure you have excellent separate books and records for each series to support the separate liability issue.
  • The single LLC tax return will reflect ALL income, expenses, assets and liabilities on a single return.
  • This is NOT like a consolidated C corporation tax return where each subsidiary is reflected separately and then consolidated at the parent level.
• Don't be penny wise and pound foolish in this venture.  Penalties, and legal issues, could certainly outweigh any professional fees.