DDA LLC Ownership Style
Answer by John Burnett, BOL Guru
Question: Can an LLC have more than a sole owner or member?
When opening a new LLC account, could you use a corporate resolution or should you always use an LLC resolution?
Should the resolution read, "Jones Properties, LLC -- John Jones, Sole Member"?
Answer: LLCs can have one or more members. If you have a sole member without employees, the LLC is permitted by the IRS to use the sole member's SSN for tax purposes.
An LLC is not a corporation, so you should not use a corporate resolution form for obtaining authorizations from the LLC. Use an LLC form.
If you are dealing with an LLC that is using its sole member's SSN, you should include the sole member's name in your account setup. Just be certain that your procedures don't allow legal process against the individual to reach the assets of the LLC (or vice versa). Banks often use the TIN on record to determine these questions. This practice should be squelched to prevent problems with attachments and other legal process.
First published on BankersOnline.com 11/29/04