Can You Have Multiple Businesses Under One LLC?

6 min read | Posted on: December 23, 2024

LLC Limited Liability Company text on wooden blocks. on a calculator on a blue background

Juggling multiple businesses doesn’t mean you have to juggle multiple limited liability companies (LLCs). Many business owners find that one LLC works better than two (or three or four). But like any business decision, the best way to structure your ventures depends entirely on your specific situation and goals.

So, can you have multiple businesses under one LLC? The short answer is yes. Now, let’s investigate the long answer.

How Do You Put Multiple Businesses Under One LLC? 5 Steps

If you’re an owner of multiple businesses, managing them under a single LLC might be easier than you think. Here’s how to do it:

1. Get Your LLC Up and Running

If you haven’t already set up an LLC, you need to make it official with your state. To form your LLC, you’ll file articles of organization. It might sound fancy, but articles of organization are just documents that contain basic information about your ventures, like business names and addresses. You can usually find these on your state’s website.

Need different business names for each of your ventures? No problem. That’s where “doing business as” names, also known as DBAs, save the day. With DBAs, you can be “Sunset Tree Web Design” and “Sunset Tree Social” while operating under one LLC.

2. Create an Operating Agreement

If your state requires it, you need to create an operating agreement. An operating agreement is like the rulebook for your team of businesses. It spells out how you’ll juggle your different businesses. Make it crystal clear by explaining:

How you’ll split up the money between businesses
Which employees are in charge of which responsibilities
How you’ll add new services or products
How you’ll keep the businesses separate
What happens when you want to expand

3. Get Your Employer Identification Number (EIN)

If you have employees, the IRS wants to know who you are. That means you have to apply for an EIN, which you use for tax returns and business bank accounts.

The application process is straightforward, and one EIN covers all your businesses. Running a copywriting service and a content marketing agency? Just use the same EIN.

4. Keep Everything Organized

While all your businesses will be under one LLC, it’s crucial to treat each one like a distinct business entity. Opening different bank accounts is a vital first step. You don’t want to mix up your course creation money with your coaching fees.

You’ll also want to separate things like:

Marketing materials
Client lists
Supplier contacts

5. Play by the Rules

Keep your LLC in good standing by following all state rules and regulations. This means you should:

File your annual paperwork on time
Get the right licenses for each business
Follow rules specific to each type of business you run
Keep your insurance for each business up to date

How Many DBAs Can an LLC Have?

If you’ve got a lot of ideas and big business ambitions, you may be wondering if your LLC can handle all of them. The good news is that it probably can.

Most states don’t limit how many DBAs an LLC can have. You could run a web design studio, social media agency, and online course platform all under one LLC. Each has its own DBA, similar to a holding company.

But each DBA requires its own registration and filing fee. Some states also have specific conditions. For example, Florida requires you to renew every 5 years, while New York doesn’t require the DBA at all.

To open business bank accounts, most banks will want to see your DBA registration documents. While you can use DBAs for marketing and accepting payments, always use your official LLC name for contracts and legal papers.

Pros of Running Multiple Businesses Under One LLC

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Operating multiple businesses under an LLC can save you time, money, and headaches. Let’s look at what makes this business structure such a draw:

Tax Benefits

LLCs are pass-through business entities, which means you report all business income on a single tax return. You can balance profits from your thriving web design business against startup costs from your new consulting business. Plus, you save money on tax preparation because you file one return instead of several.

Cost Savings

Starting with one LLC means paying one set of formation fees. You have one registered agent fee, one annual report filing fee, and one set of maintenance costs. You can also share software subscriptions, office space, and other resources between both businesses.

Simplified Administration

With one LLC, you’re looking at less paperwork and easier management. A single EIN covers all your businesses, and you can have one primary banking setup. Need to shift resources between your content writing and social media services? That’s much easier when everything’s under one roof.

Easy Pivoting

When you want to test a new business idea, forming an LLC makes it easier. A graphic designer can test the waters by offering UI/UX services without forming a new business entity. You can pivot quickly as opportunities arise. If something doesn’t work out, closing one new business line is straightforward.

Startup Advantages

Launching new businesses becomes faster and cheaper. You can leverage your LLC’s existing reputation and relationships. A successful web developer might find it easier to launch a design course because they already have business credibility. Plus, you face fewer compliance requirements than starting from scratch.

Cons of Running Multiple Businesses Under One LLC

Before you decide to run multiple businesses under a single LLC, there are some potential drawbacks to think about first:

Liability Risk

This is the biggest potential pitfall. As a pass-through entity, your LLC protects your personal assets, but not your other businesses under the same umbrella.

When you operate several businesses under one LLC, they share risk. If your web design business faces a lawsuit, your thriving online course revenue could be in jeopardy too.

Tax and Legal Complications

Tracking separate business income can be tricky with one LLC. The IRS wants clear records showing which business earned what. Mixing funds can jeopardize your liability protection. You might need specialized accounting help to file accurate tax returns.

Growth Limitations

Want to sell just your social media marketing business? That’s tough when it’s tied to your mobile app development shop under one LLC. Plus, if one business grows much faster than the other, untangling them later can get messy.

FROM ONE OF OUR PARTNERS — How To Separate Your Personal and Business Expenses

Is It Better to Have Multiple Businesses Under One LLC?

A document on different types of business formations being read by a small business owner while sitting in office desk

The answer to this question depends on your situation, goals, and businesses. Here’s how to decide.

First, look at how similar your businesses are. Multiple LLCs under one umbrella work best for related businesses. When businesses share similar risk levels and use some of the same resources, managing them is easier. But a writer running a content service and a food delivery business at the same time? Those might be better off as separate entities.

Next, think about risk. Tax classification and liability protection matter more for some businesses than others. For high-risk businesses, it’s usually better to use separate LLCs.

Other key factors about your business setup can help you make your final decision:

Best Scenarios for Multiple Businesses Under One LLC

Consider keeping businesses under one LLC when:

They offer complementary services (like SEO and content writing)
They share customers and resources
You’re testing new business ideas
They have similar risk levels
They’re all small-scale businesses

Best Scenarios for Separate LLCs

Think about separate entities when:

Your businesses have very different risk levels
You plan to sell one of the businesses down the line
State regulations require separation
You need different ownership structures

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3 Tips for Successfully Running More Than One Business

Whether you choose one LLC or several entities, running multiple businesses successfully takes thought and planning. Here’s how to keep everything running smoothly:

1. Plan Out Your Finances

Many business owners underestimate the resources needed to run multiple businesses. Before expanding, calculate how much time and energy you can devote to each business. Make sure you have enough funds to support each one. Create clear plans for staffing and resource allocation.

2. Keep Perfect Records

Good documentation helps with both IRS compliance and daily operations. Maintain separate books for each business, even if you’re operating as a single LLC. Create regular reports to track performance and monitor your tax returns and classifications carefully.

3. Protect Your Businesses

Even with a single LLC, treat each business as its own entity. Get appropriate insurance coverage for each business and review liability risks regularly. Stay current with all licenses and permits, and keep detailed documentation of all business relationships. This attention to detail protects both your personal assets and your business interests.

RELATED ARTICLE — What Is an Expense Report and How Do You Create One?

Streamline Your Workflow With Invoice Simple

Whether you’re running a one-business LLC or one with a whole fleet, getting paid should be the easiest part of managing it.

With Invoice Simple, you can give your customers flexible online payment options. Send digital invoices via email, SMS, or by manually sharing a link. You can also make it easy for your clients to pay you instantly from a paper invoice by turning on the Invoice Simple Payments QR Code. Your clients can scan the QR Code with their phones and pay online.

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