LLCs and Business account

[Eve Oliver]

Hello- I have created 2 LLCs for my 2 rentals that mean I have to have 2 different bank accounts? or I can have just one bank account that can hold all the LLCs. Any suggestions?  

[Mike S.]

Originally posted by @Eve Oliver:

@Account Closed what you mean is" it defeats the purpose of the LLC if I have all the LLCs in 1 Business account instead of creating one for each of them? I will remove all the liability protection if I have all the LLCs in one BA correct?

By using the same account for different LLC, your opposing party will argue to the court that by putting their money together both LLC should only be seen as one, so defeating the insulation that you were supposed to get by creating two different entities. It does not mean that your opposing party will prevail in its motion, but by doing so, you weakened your asset protection as it is one of the elements that would be looked at when trying to breach the company veil.

You could use the same account and keep very good books accounting for each company money, but it will be difficult to argue that they have no relation with each other. In the case of series LLC, some people will keep one account for all the series. Again, it is not an automatic failure of the company veil, but it is a point of weakness in your defense.