By Leah Kabuya
Owning a business is an amazing thing. But some people don’t stop at just one. A majority of the greatest business owners have more than one company. They keep track of all of them with a holding company.
A holding company’s purpose is to hold the controlling stock or membership interests in other companies. Unlike a parent company, a holding company doesn’t conduct any operations or offer any goods or services. Holding companies can be either a corporation or an LLC. People compare a holding company to a stay-at-home parent and a parent company to a working parent.
One of the benefits of having a holding company is the protection of assets. A holding company will hold and protect assets such as copyrights, trademarks, and patents. In case of a lawsuit, assets are better protected and therefore off-limits in some cases. Another reason for a holding company is that the owner can reap tax benefits. Owners of a holding company do not have to file different tax returns. Lastly, owners get more control of their companies. The capital is smaller even with controlling more businesses.
To start a holding company the first thing required is the evaluation of needs. What is the goal of the holding company? Next, register the company. To register the company with the state the following information is needed: the name of the business, the name of the business agent, and the articles of incorporation. The final step is the process of depositing assets. The profit will now be deposited in the holding company instead of the operating business.
At Fields Law, we can create a holding company. We will establish both companies (the LLC and holding company). We will also assist in transferring the ownership of existing companies to the holding company. Remember, Fields Law is more than just legal professionals, it’s a partner in your future.
