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I've been doing some research online and reading over every relevant thread on this forum regarding having a holding company and operating company system in place for asset protection.

I already have my operating company that's an LLC in which I am the only member.

I would really appreciate it if you guys could clear somethings up for me since there's a lot of conflicting info on this and I want to make sure I can set it up properly:

1) When I create my holding company LLC, should I add multiple members (ie. myself and a family member) for any enhanced asset protection? Or does it not matter?

2) Once my holding company is created, should the holding company become a member of the operating company? Or should there be no obvious connection between the two other than the fact that the holding company will control all assets.

3) Should both companies have insurance or if the operating companies member is the holding company... then insurance for the operating company is enough?

I'm seeing a bunch of people saying that the operating company should be a single member LLC in which the holding company is that member... and then another side which says that it's okay if I'm the sole owner of both LLC's aslong as the holding company owns the assets.

Really confusing and just trying to clear things up since I imagine incorrectly setting this up would do the same as just having the operating company.

Thanks so much for your time!

  • You should edit your question and add a country tag, as laws vary by jurisdiction. – Chris W. Rea Feb 16 '18 at 22:20

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