Using One LLC for Multiple Businesses: Smart or Risky?
Running multiple businesses is a sign you're doing something right—but managing them all under one legal entity might not be. While using a single LLC for everything can seem efficient, it can also create serious risks and complications, especially when liability or taxes are involved. In this post, we’ll walk through how it works, where it breaks down, and what alternatives make sense—like forming a holding company to oversee your various ventures.
Track Town Law helps small business owners across Oregon and Idaho navigate these exact decisions. Whether you’re launching a new venture or scaling a multi-entity operation, we can help you build a legal structure that matches your ambition.
So—can you run multiple businesses under one LLC?
Yes, legally you can. There’s no law that says an LLC can only run one business. In fact, many small business owners start this way. You might form “Maple & Pine, LLC” to run a woodworking shop in Bend. A year later, you start selling furniture restoration kits online. Rather than forming a second LLC, you just operate both under the same entity.
You might even file a DBA (also called an “assumed business name”) for the second brand, so it has a separate name but still operates under the same LLC umbrella. This works fine—until it doesn’t.
Here’s the problem: liability is shared across all activities inside a single LLC. If your e-commerce side hustle gets sued for a defective product, your woodworking shop’s assets are on the line. They’re not treated as separate businesses in the eyes of the law. Same goes for debts. If one line of business tanks financially, the others can get dragged down with it.
There’s also the issue of confusing financials. Running multiple business models out of one bank account and bookkeeping system can make it difficult to track profitability, manage tax deductions accurately, or pitch one of the businesses to a potential investor or lender. Your business might look less professional, or just too messy to deal with.
Here are a few common examples where this setup becomes a problem:
A real estate investor runs short-term Airbnb rentals and long-term residential rentals under the same LLC. A guest is injured during a vacation rental stay. Now all properties—including the long-term ones—are at risk in a lawsuit.
A consulting business also sells digital products online. The e-commerce platform faces a data breach. The professional consulting revenue is exposed to claims and liability even though the businesses have nothing to do with each other.
A small bakery adds a coffee roasting arm and a mobile food truck. All three activities generate income—but one faulty food handler’s permit could jeopardize the entire operation if it’s all under one LLC.
If you're still small and just testing new ventures, this kind of shared structure might be fine for a while. But once money, risk, or visibility start to grow, it's time to rethink.
So what are the alternatives?
The first is to form a separate LLC for each business. This is straightforward: each LLC has its own EIN, bank account, bookkeeping, and liability shield. If one gets sued, the others are protected. You can still operate all of them under your name or branding umbrella, but legally and financially, they’re firewalled.
But what if you want to keep things organized and still show that these businesses are all part of one larger operation?
That’s where a holding company structure comes in.
A holding company is a parent LLC (or corporation) that owns other LLCs as subsidiaries. You might have “Hight Ventures, LLC” as the parent, and it owns 100% of:
“Northwest Vacation Rentals, LLC”
“Pine Street Ecom, LLC”
“Track Roast Coffee, LLC”
Each child LLC operates independently, with its own liability shield, business account, and tax reporting. The parent company doesn’t run the day-to-day operations—it just holds ownership.
There are several benefits here:
Liability Protection: A lawsuit against one business doesn’t threaten the others. Each is legally distinct.
Tax Planning: With good bookkeeping, you can centralize profits, losses, and strategies under the parent. In some cases, you can also streamline expenses or take advantage of pass-through taxation across entities.
Professionalism: Investors and lenders often take you more seriously when your businesses are properly segmented and professionally managed.
Succession Planning: It’s easier to sell, transfer, or shut down one piece of your business when it's legally separate.
Branding Flexibility: You can run very different brands—without needing to explain to the world why your dog walking business and your fintech app are both run under “JH Enterprises, LLC.”
So when does it make sense to move to a holding company structure?
You’re generating revenue from more than one business model, and each has distinct liability risks.
You plan to expand or franchise one of your businesses.
You’re bringing on a partner in one business but not the others.
You want to clean up messy financials before tax season or a potential sale.
That said, it’s not always necessary to go full holding company mode right away. There are costs: each LLC may have its own state filing fees, renewal deadlines, bookkeeping, and potential tax filings. But those costs are often small compared to the risk of running multiple ventures through one shared legal entity.
Bottom line? If your businesses are small, related, and low-risk, you might be fine with one LLC and multiple DBAs—at least for now. But if your ventures are growing, diverging, or carrying real risk, you should strongly consider separate LLCs or a holding company structure. The extra work is worth the protection.
Ready to clean up your structure—or set up a smart one from the start?
Book a consultation with Track Town Law to get clear, practical advice tailored to your business and your state. We’ll help you decide what’s right for your goals, and we can handle the filings and compliance work from there.
