What is a Single-Member LLC (SMLLC)?

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A Single-Member LLC, abbreviated SMLLC, is an LLC with just 1 owner. An LLC owner is referred to as a Member, hence the name “single member” LLC. The purpose of forming an LLC is to protect the personal liability of the owners. Forming an LLC separates your personal assets from that of the business.

All 50 states allow for Single-Member LLCs and this is the most popular type of LLCs formed in the United States.

A Single-Member LLC can be owned by an individual person, or it can be owned by an existing company, such as another LLC, a Corporation, or any other legal entity.

A Single-Member LLC can also be owned by a non-US citizen or non-US resident. There are no residency or citizenship requirements for the ownership of LLCs, whether the LLC’s are Single-Member LLC or Multi-Member LLCs.

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Taxes & Single-Member LLCs

By default, a Single-Member LLC is treated as a “disregarded entity” by the IRS for federal tax purposes.

This means you will pay taxes the same way as a Sole Proprietorship does. The LLC will report its income or losses on a schedule C, which will become a part of your personal 1040 income tax return. If your income is earned by other means, you may also have to attach additional schedules to your personal income return.

Please keep in mind we said “pays taxes the same way as“. A lot of people get confused by this and think that their LLC is a Sole Proprietorship. At the state level, your LLC is simply an LLC; a legal entity formed by state statute. However, the IRS does not have a tax classification for LLCs, so the IRS just taxes the LLC according to the number of Members the LLC has.

Sole Proprietorship taxation is the default tax classification for LLCs with 1 owner. Alternatively, if you’d like your Single-Member LLC to be taxed as an S-Corp, you can do so via IRS Form 2553, or if you’d like your Single-Member LLC to be taxed as a C-Corp, you can do so via IRS Form 8832. If you are thinking about electing either form of “corporate taxation” for your LLC, we strongly advise you speak with multiple accounts in your state. Just ring a few up back to back to get a few different opinions. Often times, these types of taxation are not as simple as some articles lead you to believe.

How to pay yourself in a Single-Member LLC?

If you leave your Single-Member LLC in its default tax status as a Sole Proprietorship with the IRS, you will not be taking a salary from the company, but instead you will be taking distributions (which are subject to self-employment taxes).

If your Single-Member LLC elects to be taxed as an S-Corp with the IRS, then you will have to take a reasonable salary, pay payroll taxes, and file a corporate 1120S tax return every year.

In order to put money into the LLC you will make what are called Capital Contributions. And in order to take money out of the LLC, you will take what are called Capital Distributions.

Can I get an EIN for a Single-Member LLC?

Yes, you can obtain an EIN – also known as a Federal Tax ID Number – from the IRS for your Single-Member LLC. You will use your EIN to open your business bank account, obtaining financing, file certain taxes, and for some business licenses and permits.

How to Form a Single-Member LLC?

You will form a Single-Member LLC the same way you would form any LLC; you will file Articles of Organization (or similar form; like Certificate of Organization or Certificate of Formation) with the Secretary of State in the state where you’re forming your LLC. For example, if you’re forming a Single-Member LLC in California, you will file an Articles of Organization with the California Secretary of State.

There are no states which have a different Articles of Organization for Single-Member LLCs, however some states’ Articles of Organization will have a checkbox where you will designate whether or not your LLC is Single-Member.

To form your Single-Member LLC, you can follow our free LLC formation guides, which we have provided for all 50 states. To learn more about LLCs, check out our LLC Learning Center.

Matt Horwitz
Founder & Educator, LLC University®
Forming an LLC shouldn't be so complicated. Our step-by-step guide will make the process a breeze – and no complex legal jargon! LLC University® teaches people how to form an LLC for free in all 50 states. We hope you find our free guides and resources helpful in your business journey.
Leave a Comment (22) ↓
Disclaimer: Nothing on this page shall be interpreted as legal or tax advice. Rules and regulations vary by location. They also change over time and are specific to your situation. Furthermore, this comment section is provided so people can share their thoughts and experience. Please consult a licensed professional if you have legal or tax questions.


  1. Bob April 16, 2018

    Hi Matt,

    Is a Manager-Managed Single-Member LLC with 2 manager’s but only one member, still considered a disregarded entity? That was my intention when filing.


    • Matt Horwitz April 17, 2018

      Hey Bob, it’s all about the LLC Members. So yes, an LLC with 1 Member (regardless of management or number of Managers) is still a disregarded entity. Hope that helps!

  2. Kiran Borkar June 12, 2018

    We (my wife and I) live in Illinois and has a living trust(joint with my wife and I and my home in Illinois is part of my living trust. Recently, I bought an investment property in Tracy, CA. The investment property is owned jointly by my wife and I. I am interested in forming LLC and have the living trust be member of LLC. What is the best way to add my investment property to my living trust(is that like a sub trust) and be member of LLC. what will be my liability against lawsuits for my investment property in California – is my primary residence in Illinois available for lawsuit. For taxes, is it still filing taxes for my LLC using my personal taxes

    • Matt Horwitz June 18, 2018

      Hi Kiran, we do not work with trusts, so don’t know the answers to your questions. I recommend speaking with a few real estate attorneys for assistance. Thank you for your understanding.

  3. Ana Resto July 20, 2018


    I currently have an office together with a friend. We both have an LLC (each) with only one member but we share an office. Our advertising includes both LLC names and also the registration in the city shares both names.

    I ask…
    Is it okay for two LLCs to share the same office and the same registry in the city?

    or each LLC must be registered separately? I think for local tax purposes it could affect us.

    Thank you!

    • Matt Horwitz August 12, 2018

      Hi Ana, both LLCs can use the same address. I’m not sure what you mean by “share the same registry”. Hope that helps.

  4. LIna October 27, 2018


    I am trying to see what the best option is to keep the sole proprietor entity when i want to add my partner. For legal reason, i need him on the LLC. What do you recommend me to do? Should i create a partnership instead? is so, do you know the process to close and reopen it? is there another option? maybe to add him as a member? Please let me know.

    Thank you

    • Matt Horwitz November 22, 2018

      Hi Lina, I don’t fully understand your question as there’s some ambiguity. If you have an existing LLC that is owned by you, then it’s an LLC taxed as a Sole Proprietorship (I wouldn’t use the term “sole proprietor entity”). If you want to add a Member to your LLC, then the LLC would therefore by taxed as a Partnership. You’d need to file IRS Form 8832 to make that election and you’ll also need to apply for a new EIN. Hope that helps.

  5. Jack December 21, 2018


    I’ve become cross-eyed from searching the interwebs and I’m coming up with conflicted or incomplete information. My question for you is: Can an SMLLC (disregarded) be the sole owner of another SMLLC (disregarded)?

    For example: Me -> SMLLC 1 -> SMLLC (owned solely by SMLLC 1, which is solely owned by me).

    • Matt Horwitz January 6, 2019

      Hi Jack, yes an LLC can own another LLC. In your example, yes, you can form LLC A and be its owner, then you form LLC B and LLC B is owned by LLC A. And yes, both LLCs are disregarded LLCs. Hope that helps.

  6. Bruce Bussell February 18, 2019

    I own a small sole proprietorship company right now that I want to make a single LLC, with me as the sole owner. My questions are: Do I make it manager or member governed? Is there a reason to be one or the other as a single owner?

    Am I the governing authority?

    Do I enter into an arrangement with a registered agent prior to filing?

    Do I cancel my current EIN as soon as a new one is issued for the LLC?

    On the operating agreement, it asks about capital provisions. If I am still using all of the assets I purchased for the sole proprietorship and the money that is currently in its business checking account, do I figure up all of that and put that as my capital contribution?

    I saw something asking who the organizer is. Is that me?

    Thank you so much for answering these questions.

    Bruce Bussell

    • Matt Horwitz February 18, 2019

      Hey Bruce, hope this helps:
      • When changing from a Sole Proprietor an LLC, you can contribute the assets of the Sole Proprietorship as the capital contribution if you like. You can also include cash.
      • More info here: changing Sole Proprietorship to LLC (includes the answer to your EIN question, too)
      • Click on your state on our homepage for more details about the Registered Agent requirements/options and about governing authority.
      • If you want to use a Commercial Registered Agent, you’d sign up with them first before filing the LLC forms with the state.
      Member-managed LLC vs Manager-managed LLC
      What is an LLC Organizer

      • Bruce Bussell February 18, 2019

        After asking my question, I saw that you offer a basic package which includes a registered agent for the first year. It seems like a no brainer to use this but I have a few last questions. After using the basic service, will I still need to do the operating agreement myself? How do I create the form to take to the bank to open a new account for the business? Do I need membership certificates and if I do where do I get them if I use the basic service?

        • Matt Horwitz February 18, 2019

          Hi Bruce, it’s not our company directly, but a company we recommend. If you look at the packages they offer, you’ll see the base package doesn’t include an EIN or Operating Agreement at this time. You can find instructions for that on our site if you want to do it yourself though: LLC Operating Agreement and EIN for LLC. Or if you look at the 2nd and 3rd packages, they include the Operating Agreement and EIN. Membership Certificates aren’t needed. Membership interest can be controlled via the Operating Agreement. You can certainly use them if you want, but they are nothing more than a fancy visual representation of what’ll be in your Operating Agreement. Hope that helps.

  7. Wayne February 25, 2019

    I was the single member of an LLC and had a registered agent. The LLC was for a chapter of a social club. The chapter decided to dissolve and cease operations with the exception of one person. I, being the only member on the LLC, dissolved the LLC with the State it was registered in. As far as the funds in the account for the chapter, my registered agent is telling me I need to send him the funds because they now belong to him even though I was the only member listed on the LLC, he was just listed as a registered agent only. Is this the case or can I distribute them as I see fit to the guys who were in the chapter? We have no debt and owe no one anything. I felt the right thing to do was split it evenly among the gentleman who were in the chapter since the LLC and chapter have now dissolved. Again, I was the sole member on the LLC and no one else was on it but me.

    • Matt Horwitz February 25, 2019

      Hi Wayne, as per how the LLC winds up its affairs, you’ll want to look at the Operating Agreement. Aside from something in the Operating Agreement, if you are the only Member, it sounds very strange for any distributions to go to the Registered Agent.

  8. Gary July 2, 2019

    I am the single owner of a business LLC. As I want to retire, I wish to add my son to the LLC. He is currently manager of the business. I can’t find anything that explains how to do this; could you help please.
    Thank you


    • Matt Horwitz July 7, 2019

      Hi Gary, it’s best practice to work with an attorney on this as there are multiple steps. Here is the general overview:

      • review the Operating Agreement for procedures on adding Members

      • draft a Resolution discussing the decision

      • prepare an Assignment/Transfer of LLC Membership Interest Agreement (you need to sell/transfer some or all of your LLC interest to your son)

      • amend your LLC’s Operating Agreement

      • if applicable (meaning if the Members are listed), amend your state filing document (ex: Articles of Organization, Certificate of Organization, or Certificate of Formation)

      • if there is a change in how the LLC will be taxed by the IRS (ex: going from LLC taxed as a Sole Proprietorship to an LLC taxed as a Partnership), you need to update the IRS via Form 8832

      • if applicable, update state Department of Revenue (or equivalent agency)

      • visit bank with your son to add him as a signer (call the bank ahead of time to determine all the required documentation

      Hope that helps!

  9. Jonathon February 13, 2020

    Hi! I accidentally filed papers as an SMLLC with someone as an agent. It turns out I need an MMLLC, with myself as the managing member and the former agent at a member! What is the best and quickest way to change from SMLLC to MMLC in State of NY?! Please help!

    • Matt Horwitz February 19, 2020

      Hi Jonathon, have you already obtained an EIN for your Single-Member LLC? Did you adopt and sign an LLC Operating Agreement?


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