Managing Multiple LLC Accounts in Stessa Cash Management
Stessa Cash Management provides features to help you manage funds across multiple Limited Liability Companies (LLCs). Proper account setup is important to ensure fund separation, accurate tax filings, and smooth payment operations. This article provides best practices and explains the key distinctions between account setups for LLCs in Stessa.
Introduction
Managing accounts for multiple LLCs can be challenging, especially during tax season. Stessa allows users to create Cash Management accounts tailored for different LLCs. This guide explains how to set up and organize your accounts to maintain clarity, legal compliance, and operational simplicity.
Key Points for Setting Up LLC Accounts
1. Separate Accounts for Each LLC
To ensure funds from different LLCs remain separate, you need to create individual Cash Management accounts for each LLC. This allows:
Accurate tracking of transactions for each LLC.
Receipt of separate 1099 forms for the interest earned by each account.
If you create sub-accounts under a single LLC, they will not provide tax separation and all interest earned will be combined into one 1099 form. For clear tax records, create separate accounts and independently apply for each LLC under the Cash Management page.
2. Legal Ownership and Naming Conventions
Every Cash Management account in Stessa must match the legal entity name under which it was opened. If you create sub-accounts under a primary LLC Cash Management account, all those sub-accounts will belong to the primary LLC Cash Management account, even if you name them differently. Ensure:
Each account’s name matches the legal name of the LLC during registration.
Primary accounts are opened individually for separate legal entities with their own documentation.
3. Tenant Payments and Tracking
While it might seem convenient to have all tenants make payments into a single "master LLC" account, you cannot later associate those payments with sub-accounts or other LLC accounts. All transactions will remain linked to the master LLC, such as "F3 associates," complicating fund separation for individual LLCs. Therefore, payments should ideally be directed to accounts corresponding specifically to the respective LLCs.
4. Organizational Best Practices
Open a unique bank account for each LLC to keep your books organized and simplify tax reporting.
Consolidating accounts under one name might seem easier initially but can create challenges during tax season. It's best to set up separate accounts to avoid confusion.
Always review tax documentation needs and align your account setup accordingly.
Conclusion
Managing multiple LLC accounts in Stessa Cash Management requires careful setup to maintain proper fund separation, ensure compliance, and streamline operations. Prioritize creating separate accounts for each LLC, using the correct legal names, and matching accounts to the specific business entity. By following the best practices outlined above, you can avoid common pitfalls and manage your finances effectively.