Our content is reader-supported. We may earn a commission if you make a purchase through one of our links.
An anonymous limited liability company (LLC) is an excellent choice for those in Wisconsin looking to manage their business affairs without revealing their personal information. It’s particularly beneficial for real estate investors and business owners involved in high-risk activities who prioritize confidentiality.
The formation of an anonymous LLC in Wisconsin involves a series of crucial steps. This guide will detail the necessary procedures to set up an anonymous LLC in the state, highlighting the advantages and key considerations of opting for this business entity.
What is an Anonymous LLC?
An anonymous LLC, also known as a blind LLC or double LLC, is a limited liability company in Wisconsin that doesn’t disclose the identities of its members, managers, or owners to the public. This type of LLC provides a heightened level of privacy for its members, making it an excellent choice for those who wish to invest in real estate or start a business while maintaining anonymity.
In addition, anonymous LLCs can also be utilized to hold assets that individuals or groups prefer not to be publicly associated with, such as investments or patents.
It is important to note that anonymous LLCs are legitimate legal entities. However, they have been used in the past for illicit activities such as tax evasion and money laundering. Moreover, some countries prohibit the establishment of anonymous LLCs. Nonetheless, if the business activities and revenue generated are lawful, anonymous LLCs can provide liability protection and privacy for their members.
Before creating an anonymous LLC in Wisconsin, it is crucial to seek guidance from a tax advisor and an attorney to ensure that all laws and regulations are being followed. Additionally, make sure that anonymous LLCs are permitted in your jurisdiction.
Is it Possible to Create an Anonymous LLC in Wisconsin?
Creating an anonymous LLC in Wisconsin is technically feasible, although it requires additional steps compared to forming an LLC in a state that explicitly permits anonymous LLCs.
A common tactic employed to start an anonymous LLC in Wisconsin is the “double LLC” structure, which involves setting up a secondary, anonymous LLC as a member of the primary LLC.
In this arrangement, the first LLC is publicly identified as the asset owner or conducts the business operations. Meanwhile, the second LLC, which remains anonymous, is listed as a member of the first LLC.
Wisconsin does not explicitly allow the formation of anonymous LLCs, and the state mandates that the names and addresses of all members (or “managers” for manager-managed LLCs) be included in the articles of an organization during LLC formation. However, using a double LLC structure can help maintain a degree of anonymity for the beneficial owners of an LLC.
This double LLC approach involves creating one LLC (referred to as the “inner LLC”) owned by another LLC (referred to as the “outer LLC”). The members of the outer LLC are not publicly disclosed, as they do not appear in the articles of the organization. An outer LLC is an anonymous LLC formed in a state that allows anonymous LLCs.
Only the inner LLC is publicly visible, and the names of its members (which may include other LLCs or trusts) are listed in the articles of organization. In this manner, the inner LLC’s beneficial owners remain undisclosed, offering a level of anonymity.
It is important to consult with an attorney or financial advisor to understand the legalities and the most appropriate course of action for your specific situation. This is because regulations on LLCs vary among states and can have different implications based on the nature of the business and your unique circumstances.
How to Form an Anonymous LLC in Wisconsin
Outlined below is a step-by-step guide for utilizing the double LLC strategy. This guide demonstrates how to use an anonymous LLC as a holding company to own a standard LLC for private business ownership in Wisconsin.
Step 1 – Choose a State to Form Your Anonymous LLC
Wisconsin does not have any specific laws that permit anonymous LLCs. However, if privacy is a priority, you can establish your anonymous LLC in states that allow it, such as Delaware, New Mexico, Wyoming, and Nevada.
Read more about the best anonymous LLC states:
- How to Form an Anonymous LLC in Delaware
- How to Form an Anonymous LLC in New Mexico
- How to Form an Anonymous LLC in Wyoming
- How to Form an Anonymous LLC in Nevada
Read about how to form an anonymous LLC in any US state:
Step 2 – Form Your Anonymous LLC
To establish your anonymous LLC, you are required to submit the articles of organization to the state of your choice and remit the corresponding filing charges. You must also appoint a registered agent to handle legal paperwork for the LLC. For enhanced privacy, think about employing a nominee service to act as your registered agent.
Step 3 – Form Your Wisconsin LLC
After forming your anonymous LLC, you can proceed to create your standard LLC in Wisconsin. For this step, file articles of organization with the state of Wisconsin and pay the required filing fees. You’ll also need to choose a registered agent for the regular LLC.
Step 4 – Have the Anonymous LLC Own the Wisconsin LLC
Once both the anonymous LLC and the regular LLC are established, designate the anonymous LLC as the owner of the Wisconsin LLC. To do this, list the anonymous LLC as the owner of the regular LLC on the regular LLC’s articles of organization.
Keep in mind that this process may vary depending on the state where you are forming your LLCs. There may also be additional requirements and steps involved. It’s always a good idea to seek professional advice to ensure compliance with state laws.
Wisconsin LLC Regulations
Here are some of the key rules and regulations concerning LLCs in Wisconsin:
LLCs in Wisconsin are formed by filing Articles of Organization with the Wisconsin Department of Financial Institutions, along with a filing fee.
The name of the LLC must include the words “Limited Liability Company” or the abbreviation “LLC” or “L.L.C.” The name must also be distinguishable from the names of other entities registered in Wisconsin.
The LLC must have a registered agent in Wisconsin, who is responsible for receiving legal and tax documents on behalf of the LLC.
LLCs in Wisconsin are not required to have an operating agreement, but it is highly recommended. The operating agreement outlines the management structure, member responsibilities, and other important details of the LLC.
LLCs in Wisconsin can have one or more members, who can be individuals, corporations, or other LLCs.
LLCs in Wisconsin can choose to be taxed as either a sole proprietorship, partnership, S corporation, or C corporation. By default, LLCs with more than one member are taxed as partnerships, while LLCs with only one member are taxed as sole proprietorships.
LLCs in Wisconsin must file an annual report with the Wisconsin Department of Financial Institutions, along with a filing fee.
LLCs in Wisconsin offer limited liability protection to their members, meaning that the members are generally not personally liable for the debts and liabilities of the LLC.
LLCs in Wisconsin can be dissolved voluntarily by the members or involuntarily by a court order.
It’s important to note that these are just some of the basic rules and regulations regarding LLCs in Wisconsin, and there may be additional requirements depending on the nature of the LLC and its activities. It’s always a good idea to consult with a qualified attorney or accountant for guidance on forming and operating an LLC in Wisconsin.
Pros and Cons of Anonymous LLCs in Wisconsin
Here is a list of the pros and cons of creating anonymous LLCs in Wisconsin.
- Privacy: Anonymous LLCs can provide a level of privacy for the individuals involved in the company, as their names and personal information will not be publicly available in the LLC’s formation documents.
- Asset protection: Anonymous LLCs can help separate personal and business assets and individuals involved in the company in case of legal action or financial liability.
- Legal compliance: Anonymous LLCs can be used to comply with certain laws and regulations, such as privacy laws and regulations that apply to specific types of businesses or industries.
- Business Separation: Anonymous LLCs can help separate different business activities, allowing for a clear distinction between various businesses and their liabilities.
- Limited liability for members: Anonymous LLCs provide limited liability for members, meaning that members are not personally liable for the debts and liabilities of the LLC.
- Flexibility: Anonymous LLCs offer flexibility in management and ownership structure, as well as in tax treatment.
- Estate Planning: Anonymous LLCs can be used in estate planning and can help transfer ownership of the business to future generations.
- Anonymity can be beneficial for certain businesses: Anonymous LLCs can be beneficial for specific types of businesses, such as those in the real estate or cryptocurrency industries, where anonymity can provide an added layer of security and protection.
- Lack of complete anonymity: While anonymous LLCs can provide a level of privacy, they are not a guarantee of complete anonymity, and there may be other ways for someone to discover the identity of the members or managers of the LLC.
- Cost: Setting up an anonymous LLC may require additional legal and financial costs, such as the cost of setting up a separate legal entity or hiring a registered agent.
- Complexity: Anonymous LLCs can be complex to set up and maintain, requiring careful attention to legal and financial compliance.
- Limited to certain businesses: Some businesses may be restricted from forming an anonymous LLC.
- Can be viewed with suspicion: Anonymous LLCs may be viewed with suspicion by banks and other financial institutions, making it harder to open bank accounts or secure funding for the LLC.
- Complexity in Taxation: Anonymous LLCs can be complex to handle when it comes to taxation, as different layers of LLCs may have different tax implications.
- Difficulty in obtaining financing: Anonymous LLCs may have a harder time obtaining financing, as banks and other financial institutions may be hesitant to lend money to anonymous entities.
- Difficulty in building trust with customers: Anonymous LLCs may have a harder time building trust with customers, as the anonymity of the company may be viewed with suspicion.
- Difficulty in finding a business partner: Anonymous LLCs may have a harder time finding a business partner, as potential partners may be hesitant to work with an anonymous entity.
- Compliance with Anti-Money Laundering laws: Anonymous LLCs may have a harder time complying with anti-money laundering laws, as the anonymity of the company may make it harder to identify the beneficial owners of the LLC.
Creating an anonymous LLC in Wisconsin offers a strategy to protect both your privacy and assets in the business realm. Following the steps outlined in this article will help keep your identity private and ensure your LLC is in full compliance with state regulations.
Bear in mind that anonymity does not exempt you from legal responsibilities; hence, consulting with a legal expert prior to establishing an LLC is wise. It’s also vital to keep precise records and respect the purpose of anonymity by avoiding illegal business practices.
With careful attention to legal requirements and an understanding of the implications, you can enjoy the advantages of an anonymous business entity in Wisconsin while maintaining a legitimate and prosperous enterprise.
- How to Register a Business in Wisconsin
- Wisconsin LLC Cost
- How to Register a Business Name in Wisconsin
About the author
Dr. Alexander Sterling, Esq, a distinguished legal scholar with a business law degree and a Doctor of Juridical Science, is a leading expert in business registration and diverse business departments. Renowned for his academic excellence and practical insights, Dr. Sterling guides businesses through legal complexities, offering invaluable expertise in compliance, corporate governance, and registration processes.
As an accomplished author, his forthcoming book is anticipated to be a comprehensive guide for navigating the dynamic intersection of law and business, providing clarity and practical wisdom for entrepreneurs and legal professionals alike. With a commitment to legal excellence, Dr. Alexander Sterling, Esq, is a trusted authority dedicated to empowering businesses within the ever-evolving legal landscape.