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    0 Replies Latest reply on Jan 9, 2010 8:03 PM by LadeeCEO

    Affiliate? Subsidiary? Associate Company?

    LadeeCEO Newbie
      I am running the business for a single-member LLC. It is an online retail business. The owner does not want to change the original structure of the business, but wants to form a second business that will run the first. We will be owners of the second business and split all of the profits. Business A will still operate as is and handle the business expenses. The profits will roll down (or roll up, I don't know yet) to Business B (which will also be an LLC) and we will split them 50/50. Is this an affiliate, a subsidiary, or what? How can we do this? I know this can be done, I just don't know how.

      I already know some people will look at this and go "what the...?" I know this is an unusual situation, but we are aware of what we are doing business-wise. The current owner is an older lady (60 to be exact), not very trusting (afraid of getting "screwed") and wants to retire soon, at which time I will get the entire business. I am already an independent contractor and neither of us want it to be that way anymore. She wants to share the profits with me since I already do all of the work and I won't have to come up with any capital until I am ready to buy the business outright. I have an accounting degree and access to all the books and expenses, so there will be no shady dealings. I just want some suggestions on how to set this up and any references anyone can give me so that I can research it myself as well. Can anyone help, please?