Should you have multiple LLCs? Here are the pros and cons:

27 Mar 2023 · 1 min

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If you own multiple properties or businesses under one LLC, a lawsuit against any one of them can threaten all your assets. The speaker uses three Airbnb rentals as an example: if a guest sues successfully at one property, the judgment could come after the other two. Form a separate LLC for each property to isolate the risk.

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Here is why you should not run multiple businesses under one LLC. If you have multiple businesses under one LLC and something happens to one of the businesses, then all of the other businesses within that LLC are at risk. For example, let's say you have 3 different properties and you rent all 3 of them on Airbnb. Now let's say one of the guests slips in one of the Airbnbs and wants to sue you. If that guest prevails in a lawsuit, then all of the assets that the LLC owns, including the 3 properties, are at risk. So while it is not necessarily required, it is a good idea to seperate each business or property into a separate LLC. And the main reason is to protect each business or property from the debts and liabilities of the other businesses. This is what most people do who want to minimize their liability and risk. Follow me for more business-related tips on how an LLC can protect you from lawsuits and liabilities.

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