Anonymous LLC: Everything You Need to Know
An anonymous LLC uses a third party to register a business entity in order to protect the identity of the business owners. 3 min read
Updated June 25, 2020:
An anonymous LLC uses a third party to register a business entity in order to protect the identity of the business owners.
Can Business Owners Stay Anonymous?
As a business owner, you may want to keep your interest in a business anonymous. Staying away from lawsuits is just one possible reason. You may have heard about a business owner friend who was sued in the past, and you know that you can protect yourself from a similar situation by hiding your ownership interests.
Many internet services offer incorporation within a certain state to provide asset protection. For example, New Mexico, Wyoming, and Nevada are seen as states where privacy is strictly protected. You don't need to provide the identities of corporation shareholders, nor do you need to disclose members of a managed LLC. These individuals only need to be mentioned on the annual reports and the initial Articles of Incorporation. In these states and a few others, shareholders cannot be attacked by creditors (either LLC or corporate creditors).
Anonymous LLCs are limited liability companies where the LLC member names are not available publicly. Identities are protected by the state the LLC is registered in. Anonymous LLCs can be created by registering the business in a state where anonymous LLCs are allowed. The business is registered by a registered agent who is a third party.
Privacy is becoming more crucial thanks to an uptick in mobile and web applications. Anyone with an internet connection can access detailed records of corporate filings in most states; these records are instantaneous and either low-cost or free. Anyone can access the identities of managers and owners as well as other information about these private and public companies. You read that correctly: private companies, whether they be S corporations, C corporations, LLCs, or other entities, can be exposed to this kind of record tracking.
This is an obvious issue for anyone who does not want their name to be open to the public as a business owner. Harassment, stalking, and other issues can be prevented in part by forming an anonymous LLC and keeping personal details from being made available to the public.
Burying Your Identity in Your LLC
- Set up a series of companies. This is the most typical way of protecting your privacy. The company you legally own would own your LLC, making it harder for people to trace ownership of the LLC to your name.
- Create a blind trust, naming yourself as the beneficiary. This alternative strategy would keep your name out of public records, but there are still links that can be traced to your name.
- Set up business documents with a business address, such as a low-cost mailbox. This is beneficial because it removes your home address from public business filing records.
- Address payment records somehow. This is important because your name will be on these even if it isn't on the documents for your LLC filing. Although these would likely take a court order to get, they are fairly condemning if all of the payments are going to you or a single individual.
Keep in mind that wanting to be an anonymous owner of a company can raise some questions about business activities. It certainly invites people to take a second look at the business' activities and structure to see if the business is involved in questionable acts.
Anonymous LLC in New Mexico
Of the states that allow anonymous LLC arrangements, New Mexico is perhaps the most extreme option. In the case of a completely anonymous LLC, the state cannot be held responsible for disclosing any records of ownership, because they do not maintain these records. New Mexico's laws only require that the names of the registered agent and organizer of the business be present on the Articles of Organization. It's not required that either of these be the owner or business manager.
Make sure to consult a legitimate law firm or attorney to create your anonymous LLC in New Mexico. When you hire an internet legal company, you don't have the same guarantees that you're working with a bona fide, fully informed legal attorney.
If you need help with forming an anonymous LLC, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.