Types Of LLC Structures And Their Uses (2026)

What an LLC Is

What is an LLC? An LLC is an entity with one or more members who operate the business together. The LLC protects the members’ personal assets from business liabilities and debts.

Single-Member vs. Multi-Member LLCs

Single-member LLCs have only one member. Single-member LLCs have the benefit of sole control by one member. Additionally, the member does not share profits with anyone else.

Multi-member LLCs have two or more members. Ideally, multi-member LLCs distribute labor and risk, so neither falls on one person.

Member-Managed vs. Manager-Managed

Members handle the day-to-day decisions in a member-managed LLC. A manager-managed LLC entrusts a manager to run the business’s day-to-day operations. Often, the manager is not a co-owner.

Note that management is not the same as control. The manager handles operational matters, executing the members’ directives. The members still control the business through member votes.

Domestic and Foreign LLCs

Domestic LLCs operate in the state where they were organized. Foreign LLCs operate in a state different from the state where they were organized.

Requirements for when you need a foreign LLC and how to start an LLC differ by state. Most states will not require you to file a foreign LLC if you occasionally sell products or services in the jurisdiction. Conversely, many states require you to file a foreign LLC if you own or lease property, hire employees or conduct business regularly in the state.

To register a foreign LLC, you submit a form with your LLC’s information and a local registered agent. You also pay a registration fee. For example, Virginia charges $100 for foreign LLC registration.

Professional and Series LLCs

Professional LLCs (PLLCs) are for professionals, such as lawyers and engineers. PLLCs limit personal liability for company liabilities. However, PLLCs do not protect the personal assets of a member from malpractice or professional negligence claims against them.

What is a series LLC, and how is it used? Series LLCs have a master LLC and subsidiary cells for individual businesses. For example, a developer might have a master LLC for the overall business and a separate series LLC for each building project.

Nonprofit, L3C, and Anonymous LLCs

Nonprofit LLCs receive tax-exempt status from the IRS so they can receive tax-deductible donations. However, this type is rare because each member of a nonprofit LLC must be a tax-exempt nonprofit.

L3C LLCs can earn a profit, but only secondary to a charitable purpose. L3C organizations meet the requirements for receiving program-related investments from charitable foundations.

Anonymous LLCs shield members’ identities. In privacy-friendly states, LLCs only publicly disclose the resident agent and the organizer.

Choosing the Right LLC Type

Each LLC type has specific requirements and uses. The right LLC type for your business depends on your unique needs. A lawyer advises business owners about the options available and the benefits of each.