Florida Series LLC

Florida’s protected series LLC law (CS/SB 316), signed by Governor DeSantis on June 20, 2025, takes effect on July 1, 2026. The law allows a single parent LLC to create multiple internal divisions, each with its own assets, liabilities, members, and managers, while maintaining a statutory liability shield between them.

The protected series structure lets real estate investors and multi-venture business owners separate risk across properties or business lines without forming a separate LLC for each one. A lawsuit against one series generally cannot reach the assets of another series or the parent LLC, provided the statutory recordkeeping requirements are followed. The protection depends entirely on compliance, and questions about bankruptcy treatment and charging order enforcement remain open.

How Florida’s Protected Series LLC Law Works

Florida’s protected series LLC law is modeled on the Uniform Protected Series Act (UPSA), which the Uniform Law Commission adopted in 2021. The Florida Bar’s Drafting Committee studied series LLC statutes in Delaware (1996), Illinois (2005), Nevada (2005), Texas (2009), and several other states before recommending the UPSA model with Florida-specific modifications.

Formation begins when the parent LLC opts into the series structure through its articles filed with the Florida Division of Corporations. The parent LLC then establishes one or more protected series with the affirmative vote or consent of all members, unless the operating agreement provides for a lower approval threshold. Each series must be created through a protected series designation filed with the state.

Every series name must begin with the parent LLC’s name and include the phrase “Protected Series” or the abbreviation “P.S.” A series cannot create sub-series. Each series is treated as a separate “person” for liability purposes and under the Uniform Commercial Code, even though it is not a separate legal entity from the parent LLC.

Both newly formed LLCs and existing Florida LLCs can establish protected series after July 1, 2026. The delayed effective date was requested by the Florida Department of State, which needed time to build new forms and filing procedures. Florida will also recognize foreign series LLCs formed in other states that register to do business here.

Recordkeeping Requirements

The liability shield between series survives only if each series maintains strict, contemporaneous records that identify its assets and liabilities separately from every other series and from the parent LLC. The statute requires records detailed enough that a disinterested, reasonable person could identify each asset, distinguish it from assets held by other series and the parent, and determine when and how the series acquired it. If an asset came from the parent or another series, the records must also document the consideration paid.

These requirements go beyond standard LLC bookkeeping. Each series should maintain its own bank account, its own insurance policies, and its own contracts. Assets cannot be pooled across series or treated as interchangeable. Internal transfers between series must be documented with the same rigor as arm’s-length transactions between unrelated entities.

Failure to maintain these records can allow a creditor to pierce both the horizontal shield (between series) and the vertical shield (between the LLC and its members). The standard for piercing has not been tested in Florida courts, but the statute makes clear that proper recordkeeping is a condition of protection, not merely a best practice.

The Horizontal Liability Shield

A standard LLC provides a vertical liability shield: it protects individual members from the company’s business obligations. A protected series LLC adds a second, horizontal shield that insulates each series from the obligations of every other series and from the parent LLC itself.

The horizontal shield means that a creditor of one series generally cannot enforce its claim against assets held by a different series. A real estate investor holding ten properties in ten separate series keeps a slip-and-fall judgment at one property from threatening the other nine. The parent LLC’s own assets are similarly insulated from the obligations of any individual series.

The horizontal shield is statutory rather than structural. Separate LLCs achieve the same result through separate legal existence, and decades of case law confirm that one LLC’s creditors cannot reach another LLC’s assets. The series LLC achieves the same separation through a statute that has been on the books in some states since 1996 but has produced very little case law testing the shield’s limits. Florida has none.

Asset Protection Considerations

The interaction between the protected series structure and charging order protection is the biggest open question for asset protection planning. Florida’s charging order statute limits a creditor’s remedy against a member’s interest in a multi-member LLC to a lien on distributions. Whether a creditor of an individual member can reach the member’s interest in a specific series, or only the parent LLC, depends on how courts interpret the member’s “transferable interest” in the series context. The statute does not address this directly.

For single-member parent LLCs, the series structure does not fix the fundamental problem. Florida permits foreclosure on a sole member’s LLC interest when a charging order alone will not satisfy the judgment. If a creditor forecloses on the sole member’s interest in the parent LLC, the creditor potentially gains access to every series through the parent. A multi-member parent LLC with a properly drafted operating agreement remains the stronger foundation for creditor protection regardless of whether the series structure is used.

Bankruptcy treatment is equally uncertain. Federal bankruptcy jurisdiction preempts state law, and bankruptcy trustees have broad avoidance powers. Whether a bankruptcy filing by the parent LLC would sweep in the assets of individual series, or whether each series would be treated as a separate debtor, has not been resolved. The UPSA’s drafters acknowledged this concern, but federal courts will make the final determination.

Series LLC vs. Separate LLCs

The primary advantage of a protected series LLC over multiple separate LLCs is administrative efficiency. Forming ten separate Florida LLCs requires ten formation filings at $125 each, ten annual reports at $138.75 each, and potentially ten registered agent arrangements. A single series LLC with ten protected series requires one formation filing, one annual report, and one registered agent, with additional filing fees only for the series designations.

The primary disadvantage is untested case law. Separate LLCs have decades of judicial precedent confirming that one entity’s liabilities cannot reach another entity’s assets. The series LLC’s horizontal shield is statutory but has minimal case law anywhere and no Florida case law at all. Courts have not addressed how the shield interacts with fraudulent transfer claims, how bankruptcy trustees will treat series assets, or whether certain creditors (particularly governmental agencies and tort claimants) can reach across series boundaries.

The cost savings also narrow in practice. Each series must maintain its own bank account, its own insurance coverage, and its own accounting records. Banks may not yet have procedures for opening accounts in the name of a protected series. Insurers may require separate policies per series. The administrative burden of maintaining compliance across ten series is comparable to maintaining ten separate LLCs, even if the state filing fees are lower.

	Protected Series LLC	Separate LLCs
Formation cost	1 filing + series designations	Separate filing per LLC ($125 each)
Annual reports	1 report ($138.75)	1 report per LLC ($138.75 each)
Liability shield	Statutory, untested in FL courts	Decades of case law
Bankruptcy treatment	Uncertain	Well-established
Recordkeeping	High (per-series separation required)	Standard (per-entity)
Banking/insurance	Institutions may not recognize series	Standard entity accounts

For asset protection purposes, the certainty of separate LLCs outweighs the cost savings of the series structure when the portfolio involves high-value assets. The cost difference is most meaningful for portfolios with many lower-value assets where the filing and maintenance fees for separate LLCs would be disproportionate to the value protected.

Why Florida Waited Until 2026

Florida’s decision to adopt series LLC legislation in 2025, nearly three decades after Delaware first introduced the concept in 1996, was deliberate. When the Florida legislature overhauled the entire LLC act in 2013, the drafting committee considered and rejected a series LLC provision.

Jon Alper talked to an attorney who served on the Florida Bar committee that drafted the 2013 LLC law. The committee recognized that a series LLC statute would attract some out-of-state businesses to Florida. The concern was that small business owners would not realize how complicated operating a series LLC is. Each series must maintain distinct books and records and follow its own operational formalities. Committee members felt that small businesses using the structure incorrectly would expose themselves to veil-piercing claims without understanding the risk.

The 2025 legislation addresses that concern by adopting the UPSA model, which imposes strict recordkeeping requirements and makes the consequences of noncompliance explicit in the statute. The year-long delayed effective date (July 1, 2026) gives the Department of State time to build new filing procedures and gives business owners time to evaluate the structure before forming one.

Who Should Consider a Protected Series LLC

The protected series LLC is best suited for businesses managing multiple similar assets with recurring liability exposure and moderate individual value. Real estate investors holding numerous rental properties, franchise operators with multiple locations, and investment funds managing separate asset pools are the typical use cases.

The structure is less appropriate for a single high-value asset, where the cost savings are minimal and the untested case law creates unnecessary risk. It is also less appropriate as a stand-alone creditor protection strategy. The horizontal shield protects assets from cross-contamination between ventures, but it does not strengthen the debtor’s position against a personal creditor pursuing a charging order or foreclosure against the member’s parent LLC interest.

A full protection strategy typically starts with entity structure at the LLC level, adds statutory protections like tenants by the entirety ownership and homestead, and where appropriate includes offshore structures for assets exceeding domestic protection thresholds. The series LLC fits within the entity layer as a cost-efficiency tool for compartmentalizing business risk. It is not a substitute for the foundational creditor protections that proper LLC membership structure and operating agreement drafting provide.