Compare the Virginia Business Trust to the Series LLC. Learn why Virginia Entrepreneurs May Benefit from the Flexible, Cost-Effective VBT.
- chriserich
- Apr 14
- 5 min read
By Chris, Senior Associate Attorney at A. R. Pike Law Firm, Lynchburg, Virginia
If you’re a Virginia entrepreneur dreaming big and building smart, one of the most important early decisions you’ll make is how to structure your business. I’m talking about the legal structure of your business — the entity you’ll be living with, filing taxes under, and depending on for liability protection for years to come.
Two powerful but often misunderstood options are the Virginia Business Trust and the Series LLC. Both offer unique benefits. Both can be tailored to your business model. But if you’re operating in Virginia, one may save you more time, money, and headaches — and might just give your business the strong, flexible foundation it needs to grow.
Let’s explore both, compare them side-by-side, and help you decide which entity makes the most sense for your venture.
What Is a Series LLC?
First created in Delaware and later adopted by a handful of states, the Series LLC is a limited liability company that can create internal “series” — essentially, mini-LLCs under the umbrella of a single parent company.
Each series can have:
Its own assets and liabilities
Its own members
Its own managers
Its own business purposes
This setup is particularly popular among:
Real estate investors (think: one property per series)
Franchisors
Entrepreneurs running multiple, distinct ventures under one roof
Good news for Virginians: While some online sources still incorrectly state that Series LLCs aren’t allowed in the Commonwealth, Virginia does allow the formation of Series LLCs — and we at A. R. Pike Law Firm have helped clients form them.
But here’s the kicker: Series LLCs come with a fair share of complexity.
What Is a Virginia Business Trust (VBT)?
A Virginia Business Trust is a flexible, statutory business entity that combines elements of trust law and business entity law. Created by the Virginia Business Trust Act in 2002, the VBT can function similarly to an LLC or corporation, but with more freedom in how you structure governance, ownership, and liability.
A VBT:
Is formed by filing Articles of Business Trust with the State Corporation Commission (SCC)
Operates under a governing document called a Business Trust Agreement
Can be managed by trustees and owned by beneficial owners
Offers limited liability protection
Can establish internal series, similar to a Series LLC
Yes, you read that right. Contrary to some outdated summaries, Virginia Business Trusts can establish internal series — with separate assets, liabilities, and even fiduciary structures — all under one entity.
Why the VBT Might Be the Smart Choice in Virginia
Let’s break down why more Virginia entrepreneurs — especially those looking to simplify, save money, and stay flexible — are turning to the Virginia Business Trust instead of the Series LLC.
1. Lower Cost of Maintenance
If you’ve ever tried to keep a Series LLC compliant, you know it can feel like herding cats — legally distinct cats, each with their own books, contracts, and reporting duties. Some states require separate filings and annual fees for each series, and the IRS may treat each one as its own taxpayer. That’s a lot of paperwork, a lot of fees, and a lot of chances for something to slip through the cracks.
The VBT, by contrast, is refreshingly simple.
Once formed, you can set up internal series without making additional public filings. Your governing document — the Business Trust Agreement — does the heavy lifting. With careful drafting, the attorneys at A. R. Pike Law Firm can help you achieve the same compartmentalization of liability that a Series LLC offers, but with significantly fewer ongoing headaches.
2. Legal Clarity in Virginia
Virginia law is unambiguous when it comes to Business Trusts. The Virginia Business Trust Act gives these entities strong statutory footing, and they’re recognized, respected, and understood by Virginia courts and professionals.
Series LLCs? Not so much.
The concept of a Series LLC is still evolving. Not all states recognize them. Not all courts enforce their internal liability shields. And there's a legitimate risk that the protections offered by a Series LLC in, say, Delaware, might not be honored in Virginia court — especially if the internal records and operations aren’t meticulously maintained.
For Virginia entrepreneurs operating primarily in-state, the VBT gives you more certainty, less risk.
3. Flexible Governance and Ownership
The VBT shines in its ability to accommodate custom structures. You can:
Create "manager-managed" or "member-managed" models
Designate separate series with distinct asset classes and different business objectives
Assign varying economic rights to different beneficial owners (more than one class of "share" permitted)
Integrate estate planning tools (e.g., grantor trusts or dynasty provisions)
For entrepreneurs who want to build generational wealth, bring in investors, or manage multiple product lines or ventures under a single umbrella, the VBT offers a sophisticated platform with none of the Series LLC’s rigidity or uncertainty.
When Might a Series LLC Still Make Sense?
To be fair, Series LLCs still have their place — especially for clients who:
Are operating across state lines in jurisdictions that support the Series LLC model
Already have accounting systems and legal teams familiar with the nuances of maintaining each series as a quasi-independent entity
Need internal liability shielding for regulatory or investor reasons
But if you’re based in Virginia, operating primarily in Virginia, and you don’t have a team of CPAs and general counsel on standby — the Virginia Business Trust may be the smarter, more cost-effective play.
Let’s Talk Liability Protection
One of the most common reasons to form a business entity is to protect personal assets from business liabilities. Both the VBT and the Series LLC can offer this — but only if structured correctly.
Here’s where things can get dicey. If you’re managing multiple business lines or properties and haven’t clearly segregated assets and operations between your Series LLC’s internal series, a court may ignore the series and treat everything as one big pot of assets.
The same risk exists with a sloppily drafted Business Trust — but with proper planning, we can build in strong internal liability shields between each series or “cell” of the trust. No Swiss cheese legal shields here.
So… Which Should You Choose?
If you’re an entrepreneur in Virginia considering how to structure your business, here's the short version:
Feature | Virginia Business Trust | Series LLC |
Legal Recognition in VA | Yes, fully authorized | Yes, but with evolving support |
Cost of Formation & Maintenance | Lower | Potentially higher with multiple series |
Internal Liability Shielding | Yes, with proper drafting | Yes, but dependent on formalities |
Tax Flexibility | Yes | Yes, per series (but more complex) |
Complexity | Moderate | Higher, especially with multiple series |
Best for | Local entrepreneurs, investors, family businesses, estate planning | Multi-state real estate holdings, franchises, complex portfolios |
Ready to Form Your Business Entity the Right Way?
At A. R. Pike Law Firm, we specialize in helping entrepreneurs across Virginia form, structure, and grow their businesses with confidence. We have personally helped clients form both Series LLCs and Virginia Business Trusts — and we will work with you to identify the right entity for your specific goals.
Whether you’re launching a new venture, restructuring your real estate portfolio, or planning for the next generation, we are here to guide you every step of the way. No jargon. No fluff. Just tailored, strategic counsel backed by years of experience and a deep understanding of Virginia business law.
Let’s make your business structure work as hard as you do.
Schedule Your Business Formation Consultation Today
Ready to take the next step? Contact A. R. Pike Law Firm at (434) 288-1140 or info@arpikelaw.com to book your consultation.
Let’s build something extraordinary — and make sure it’s built to last!
Comments