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Establishing a Wyoming LLC to do business primarily in Maryland

Asked by: Charmaine - 22 August, 2011 I am thinking of setting up Wyoming LLC as the parent company under which a number of other businesses in different fields (services and sales) would operate, mostly in Maryland. What would be the best way to go about this? A series LLC, in which case I'd have to consider a state other than WY, or can an LLC own several DBAs? I have little or no start-up capital for any of the businesses but wanted to keep them separate for liability reasons (services include health counseling and massage; sales are of personal care products). Would it be better to form a single entity at first then split up as the business grows?
Answered by: Robert Kowalski - 29 August, 2011 Dear Charmaine,

I see a few problems with your plan that I would like to point out:

1. If the businesses are going to be located in Maryland you should register the entities in Maryland. You could still form a Wyoming LLC and then register it in Maryland as Foreign Entity, however in my opinion its pretty redundant.

2. Maryland has no Series LLC laws, so this is not an option to consider in your case.

3. You could run all businesses under one Maryland LLC for some time, and then "split" them away one by one as they mature. To do that you could register DBAs for this LLC, and then when the time comes cancel the DBA and form an LLC with that name. The problem with that plan is liability protection - you want to make sure that one unlucky business would not hurt another, more successful one.

Bottom line, you should evaluate the risk of having all businesses held in one LLC for a time being until they grow. Of course the solution of one LLC with several DBAs is more economical than registering several LLCs at once.


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