Florida recently joined a growing number of states by adopting legislation that allows the formation of Series Limited Liability Companies, commonly called Series LLCs. While this concept has existed in other states for years, it is new to Florida and goes into effect on July 1 of this year under Sections 605.2101 through 605.2802 of the Florida Statutes.
At its core, a Series LLC is a single parent LLC that can establish multiple internal divisions, called “protected series” or simply “series.” A new series is generally created by establishing the series in the LLC’s operating agreement and filing a “protected series designation” with the Florida Department of State.
Once created, each series may hold its own assets and liabilities and can be operated, owned, and managed differently from the others while existing under the same parent entity. This new law provides additional flexibility for business owners and investors by offering a new way to organize and protect assets as long as the statutory requirements are followed.
HOW IT WORKS
A helpful way to think about a Series LLC is as a container with separate compartments inside. The parent LLC is the container and each series functions much like a stand-alone company. The primary appeal of this structure is liability separation. When properly formed and maintained, a claim involving one series should not reach the assets held in another.
Consider a real estate investor who owns several rental properties. Traditionally, that investor might form a separate LLC for each property to isolate risk. Under the new Florida law, however, the investor could form one Series LLC and create a separate series for each property. If a lawsuit arises from one property, the goal is to limit exposure to that specific series rather than the entire portfolio.
HOW IT DIFFERS
A traditional LLC protects its owners from personal liability but it does not separate risk among different assets owned by the same entity. If multiple properties or business operations are held in one LLC, a problem tied to one asset can potentially affect all other assets.
A Series LLC is designed to address that issue by allowing internal liability protection within a single LLC. This can reduce the need to form and maintain multiple LLCs, which may result in lower administrative costs and simpler management. That benefit only holds up, however, if each series is treated as truly separate. Separate records, separate bank accounts and clear operational boundaries are essential.
HOW TO CHOOSE
Forming multiple individual LLCs remains a familiar and reliable approach. Lenders, insurers, and title companies are comfortable with that structure and the legal framework is well established. Series LLCs are newer in Florida, which means some third parties may be less familiar with how they work.
For some, the certainty of multiple LLCs will still be the better choice. For others, especially those managing several related assets or projects, a Series LLC may offer a more efficient and streamlined alternative. The right structure depends on the nature of the assets and the practical realities of working with banks, business partners, and investors.
REAL-WORLD APPLICATIONS
Beyond real estate, Series LLCs can work well for businesses that operate multiple ventures under a single umbrella. One series might own equipment, another could operate a service business, and a third could hold intellectual property. Each series can be structured to limit exposure from the others, while still benefiting from centralized management. The key advantage is flexibility and simplification. Florida’s new law does not replace traditional LLCs. Instead, it adds another option for structuring ownership and managing risk.
PROCEED WITH CARE
Although Series LLCs offer potential benefits, they require planning and ongoing attention to ensure that separate records are maintained for each series. Additionally, because the law is relatively new in Florida, it may take some time for practical standards to develop as Series LLCs are put into use and slowly become more common.
Before choosing this structure, it would be best to discuss your unique circumstances and personal goals with an adviser who understands Florida’s new statute and how it fits within the broader legal landscape.
CONCLUSION
Florida’s Series LLC law provides business owners and investors with a new tool that can offer meaningful advantages in the right circumstances. When implemented and maintained properly, it can simplify ownership while still protecting valuable assets. As with any entity choice, the benefits depend on selecting the structure that best fits the situation and using it as intended. Understanding how it works, how it differs from other options, and how to maintain it properly can help ensure the structure delivers the benefits it promises.
ABOUT THE AUTHOR
Eric F. Werrenrath is a shareholder at Winderweedle, Haines, Ward & Woodman, P.A. practicing in the areas of corporate law, real estate, commercial lending and general commercial litigation.
He represents business owners and property owners in a wide range of corporate and real estate matters, including entity formation, restructuring, mergers and acquisitions, dispute resolution and litigation. In addition to his work with business owners, he has extensive experience representing lenders and borrowers in all aspects of commercial lending. He is an Orlando native, attended Wake Forest University for undergraduate studies, and earned his Juris Doctorate, cum laude, from Stetson University College of Law.
Eric F. Werrenrath, Esq.
PHONE: 407-423-4246
EMAIL: ewerrenrath@whww.com
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Founded in 1931, Winderweedle, Haines, Ward & Woodman, P.A. is the oldest law firm in Central Florida, as named by the Orlando Business Journal. The firm offers a full range of services, including legal representation in business law, litigation and appeals, bankruptcy, banking, insurance law, estates and trusts, government, property rights, and real estate, as well as other areas.