Does a single-member LLC protect my Florida Airbnb rental from personal liability?

In our view, a single-member LLC in Florida offers less protection than many hosts assume. In Olmstead v. FTC, 44 So.3d 76 (Fla. 2010), the Florida Supreme Court held that the charging order was not the exclusive remedy a creditor had against the owner of a single-member LLC. That ruling is why many Florida short-term rental hosts add a second member or move to a two-LLC structure. This is educational content, not legal advice. Consult a licensed Florida attorney about your specific situation.

What is the Olmstead case in Florida?

Olmstead v. FTC, 44 So.3d 76 (Fla. 2010), is the Florida Supreme Court decision that allowed a creditor of a single-member LLC owner to reach the owner's LLC interest directly, rather than being limited to a charging order. It is the central case cited when Florida asset-protection planners recommend multi-member LLC structures for single-owner businesses.

What is a two-LLC structure for a Florida rental property?

A two-LLC structure generally pairs a holding LLC (often formed in a charging-order-exclusive state) with a Florida operating LLC that holds the rental property and runs the short-term rental business. The structure is designed to separate asset ownership from day-to-day operating risk. It is not a silver bullet, and it depends on proper formation, adequate insurance, and good operating hygiene.

Sample Florida LLC Operating Agreement: What a Real One Looks Like (and Why Single-Member Templates Are Dangerous in Florida)

Published 2026-05-01

A real-estate investor in Sarasota used the same one-page Operating Agreement template for his single-member Florida LLC that he had used for his Texas LLC and his Wyoming LLC. He thought the document was interchangeable. It is not. A creditor obtained a $215,000 judgment against him personally in late 2024. Under Texas and Wyoming law, the creditor would have been limited to a charging order against his LLC interest, a frustrating, almost-useless remedy. Under Florida law, because the LLC was single-member and his Operating Agreement contained none of the protective language Florida law actually allows, the creditor moved to foreclose on the entire LLC interest. The creditor took the Sarasota property, free and clear. The protection the LLC was supposed to give him did not exist on paper.

Florida is the state where the Operating Agreement matters more than almost anywhere else, and where most templates fail hardest. The reason is a 2010 Florida Supreme Court decision that nearly every other state's templates ignore.

Why Florida is different

In Olmstead v. Federal Trade Commission, 44 So. 3d 76 (Fla. 2010), the Florida Supreme Court held that the charging order is NOT the exclusive remedy a creditor has against a single-member Florida LLC. A creditor can foreclose on the membership interest itself and take the LLC's assets. The Florida Legislature responded in 2013 by amending the Florida Revised LLC Act, codified at Fla. Stat. § 605, to clarify the charging-order rules. The amended statute, Fla. Stat. § 605.0503, restored charging-order-as-exclusive-remedy treatment for multi-member LLCs but explicitly preserved the single-member exception from Olmstead.

The practical consequence: a single-member Florida LLC is structurally weaker, by statute and by case law, than a multi-member Florida LLC. The Operating Agreement and the formation structure are what a Florida-based attorney builds around to compensate.

Jonathan Alper of Alper Law in Lake Mary, Florida, has spent decades practicing in this exact area. His position, summarized: a single-member Florida LLC owned by a Florida resident, with a thin Operating Agreement, is not really asset-protected at all. The protection comes from structure (multi-member LLC, manager-managed, written agreement that anticipates Olmstead), not from the entity tag alone. (Alper Law, https://www.alperlaw.com.)

What a real Florida Operating Agreement contains

What follows is a section-by-section walkthrough of a substantive multi-member, manager-managed Florida LLC Operating Agreement, structured to address the Olmstead gap.

Article I, Formation

Names the company, the date, the principal office, and the registered agent. Cites Fla. Stat. § 605 (the Florida Revised LLC Act) as the governing statute. Sets Florida as the choice-of-law and venue.

Article II, Purpose and Term

Lawful purpose, perpetual term unless dissolved per the agreement.

Article III, Members and Capital Contributions

Lists members and units. CRITICAL: a substantive Florida LLC includes more than one member, even if the second member holds a small economic interest. The structural reason is Olmstead. Two members, even if one holds 99% and the other 1%, removes the single-member exception. Toby Mathis of Anderson Business Advisors has written about the multi-member Florida structure as the practical workaround. (Anderson Business Advisors, https://andersonadvisors.com.)

Article IV, Allocations and Distributions

Manager (or board) discretion over distributions. Explicit statement that no distribution is required to satisfy a charging order. Tax distributions provisions, with sequencing.

Article V, Tax Treatment

Federal tax classification (partnership for multi-member, with reservation of the right to elect S-corp under IRS Form 2553 and Treasury Reg § 301.7701-3). Limits inspection rights to members in good standing only.

Article VI, Management

Manager-managed is generally preferable for Florida LLCs intended for asset protection. Manager-managed structure cleans up the line between economic ownership and control authority, which strengthens the charging-order-only argument under Fla. Stat. § 605.0503.

Article VII, Transfers of Interests

Restrictions on transfer, right of first refusal, tag-along, drag-along. Prevents the involuntary admission of a creditor or assignee as a substitute member.

Article VIII, Dissolution and Continuation

Includes a successor-member clause to prevent dissolution on a member's death or incapacity. Florida default rules can dissolve a single-member LLC on the member's death; a written agreement that names a successor avoids that trap.

Article IX, Charging Order Protection

Cites Fla. Stat. § 605.0503 by section number. States that:

For a multi-member Florida LLC, the charging order is the exclusive remedy a creditor has against a member's interest.
The holder of a charging order is treated as a transferee of the economic interest only, with no voting, management, or inspection rights.
The company is not required to make any distribution to satisfy a charging order.
Tax allocations continue to flow to the charged interest, with no guarantee of corresponding cash distributions (the "phantom income" pressure that often forces a creditor to settle).

Article X, Indemnification

The company indemnifies members and managers for liabilities arising out of company business, except for willful misconduct, fraud, or gross negligence.

Article XI, General Provisions

Governing law (Florida), entire agreement, amendments, severability, electronic signatures, banking authority, confidentiality, dispute resolution.

Article XII, Reorganization and Domestication

Authority to convert, domesticate, or transfer the company under Fla. Stat. § 605.1041 et seq. Useful if the structure needs to relocate.

Article XIII, Olmstead Mitigation Acknowledgments

A Florida-specific section that:

Acknowledges the multi-member structure.
Recites the parties' intent to qualify for charging-order-as-exclusive-remedy treatment under § 605.0503.
Confirms that the second member's interest is a real economic interest, not a sham, with the documentation (capital contribution, distribution history) to back it up.

The third bullet matters. Courts can pierce a "sham" multi-member structure where the second member is treated as a nullity. The substantive Operating Agreement and the underlying records must show the second member is real.

What cheap Florida templates leave out

The form you find on a free legal site, when applied to Florida, typically:

Treats the LLC as if Olmstead never happened.
Does not include the multi-member structural recommendation.
Does not include charging-order language with § 605.0503 cited.
Does not include transferee-status mechanics.
Does not include the tax-allocation-without-distribution language.
Does not include successor-member or continuation provisions.
Does not address Florida's specific dissolution rules.

For an out-of-state-resident filing a Florida LLC (a Wyoming holding LLC owning a Florida operating LLC, for example), the template gets even more wrong. Wells Fargo Bank, N.A. v. Barber, 85 F.Supp.3d 1308 (M.D. Fla. 2015), is the choice-of-law case Florida practitioners cite to show that a Florida resident's foreign LLC interest can still get pulled into Florida law. The case involved a Nevis LLC, not a Wyoming LLC, but the principle, that residency matters when courts apply LLC law, is one Florida operators have to plan around.

What this means for your Florida LLC

If your Florida LLC is single-member with a one-page Operating Agreement, you are operating under Olmstead's worst-case rule. The structure can be repaired. Adding a real second member, switching to manager-managed, and replacing the agreement with a substantive one drafted against Fla. Stat. § 605 and the Olmstead workaround is what a Florida asset-protection attorney would do.

We are a registered agent and LLC formation service for Florida. We provide a substantive Florida Operating Agreement with every formation we file, written against the actual provisions of the Florida Revised LLC Act and the Olmstead reality. If you formed elsewhere and want a stronger document, we can prepare one.

Frequently Asked Questions

Is a Florida LLC Operating Agreement required by law?

Florida does not require you to file your Operating Agreement with the state, but Fla. Stat. § 605.0105 explicitly recognizes the operating agreement as the governing document for the LLC's internal affairs. Operating without one means Florida's default statutory rules apply, which are markedly less favorable in the single-member context post-Olmstead.

Does Florida give single-member LLCs the same protection as multi-member?

No. Olmstead v. FTC, 44 So. 3d 76 (Fla. 2010), established that a single-member Florida LLC does not enjoy the charging-order-as-exclusive-remedy protection. Fla. Stat. § 605.0503 codified the rule. The structural workaround is a multi-member LLC.

Can my spouse be the second member?

Yes, but the second member's interest must be real and substantively documented. Capital contributions, distributions, and decision-making authority should reflect the second member's economic role. A "1% spouse" with no actual involvement may be vulnerable to attack as a sham.

Should I use a free Operating Agreement template for my Florida LLC?

Free templates are a starting point for understanding structure. They are rarely useful as a substitute for a real Florida Operating Agreement, because they almost never address Olmstead, the multi-member workaround, or the protective clauses that Fla. Stat. § 605 makes available.

Can I update my Operating Agreement later?

Yes. The agreement can be amended at any time according to its own terms. No state filing is required. Amendments should be kept with the company's permanent records.

Disclosure: We cite Jonathan Alper (Alper Law) and Toby Mathis (Anderson Business Advisors) as industry voices we follow. We have no business relationship with either firm. Their materials are referenced for educational purposes; we do not represent that they endorse, sponsor, or are affiliated with our service. Readers should consult licensed counsel for advice specific to their situation.

We are a registered agent and LLC formation service. We are not a law firm and do not provide legal advice. The information on this page is for educational purposes only.