Key Takeaways
- Tennessee extends charging-order-as-exclusive-remedy protection to single-member LLCs the same as multi-member LLCs — T.C.A. § 48-249-509
- Tennessee does not legally require a written operating agreement, but you should have one anyway
- Watch this one closely: the Tennessee Supreme Court significantly overhauled the state's veil-piercing standard in Youree v. Recovery House of East Tennessee, LLC, 705 S.W.3d 193 (Tenn. 2025) — a very recent decision (2025) that reworks how Tennessee courts evaluate the unity-of-interest and fraud-or-injustice prongs of the traditional test. Because this is so new, treat Tennessee's alter-ego risk level as a live, developing area rather than settled precedent, and expect lower courts to keep clarifying exactly how Youree applies to single-member LLCs specifically over the next several years.
- Tennessee has no personal income tax on wages, and the Hall Tax (a 6% tax that applied only to interest and dividend investment income) was fully repealed effective January 1, 2021 — Tennessee became the second state after Alaska to eliminate personal income tax of every kind. A single-member LLC owner owes no state-level income tax on the LLC's pass-through profit, only federal income tax and federal self-employment tax.
- Yes — T.C.A. § 48-249-203(c) explicitly addresses single-member LLCs, confirming that a solo owner may adopt an operating agreement between the member and the LLC and will be bound by it. This is meaningfully more explicit sole-member language than many states include, though it stops short of Wyoming's charging-order-specific inclusion.
- Same-day single-member LLC formation and a solo-owner operating agreement available through LLC Attorney, at no markup on state fees
A single-member LLC is the most common way solo owners in Tennessee structure their business — a clean, member-count-blind charging-order statute and no state income tax make it a genuinely solid choice, with one very recent veil-piercing development worth watching.
This guide covers exactly how a Tennessee single-member LLC works in 2026 — the § 48-249-509 charging-order protection, the 2025 Youree veil-piercing overhaul, the Franchise & Excise Tax nuance for individually-owned SMLLCs, and how the LLC is taxed overall.
What Is a Tennessee Single-Member LLC?
A single-member LLC (SMLLC) is a limited liability company with exactly one owner. It's formed the same way as any other Tennessee LLC — same Articles of Organization, same registered agent requirement — the only difference is ownership structure. By default, the IRS treats a single-member LLC as a "disregarded entity," meaning its income passes through to the owner's personal tax return rather than being taxed at the entity level.
Does Tennessee Protect Single-Member LLCs From Charging Orders?
A charging order limits a creditor of an LLC member (a personal creditor, not a business creditor) to collecting distributions from that member's interest — rather than letting the creditor seize LLC assets outright or force a sale. Many states extend this protection to multi-member LLCs without question, but treat single-member LLCs differently since there's no other member to protect from an unwanted co-owner.
Yes, per a clean statute, though not yet tested by a Tennessee court in a single-member-LLC-specific fact pattern the way Florida's Olmstead tested Florida's. T.C.A. § 48-249-509 makes the charging order the "sole and exclusive remedy" of a judgment creditor against a member's interest, limits the creditor to a receivership-style claim on distributions, and grants no foreclosure or voting rights — and it applies to "a member" without regard to the number of members in the LLC. No Tennessee case law has carved single-member LLCs out of this protection.
Do I Need an Operating Agreement for My Tennessee SMLLC?
No, but Tennessee's statute goes out of its way to validate a solo owner's agreement. T.C.A. § 48-249-203(c) states: "An LLC with a single member may adopt, and, if so, shall be bound by, an operating agreement between the member and the LLC" — explicit statutory language confirming a one-person operating agreement is just as enforceable as a multi-member one, even though it isn't legally required.
A Tennessee operating agreement can name a successor member and include transfer-on-death language, letting your LLC interest pass to an heir without going through Tennessee probate — worth including even though Tennessee doesn't require the document itself.
Is a Tennessee Single-Member LLC Easier to Pierce?
Courts everywhere apply the corporate veil doctrine to LLCs, but with only one member, there's no second owner's independent conduct to point to as evidence the company is a genuinely separate entity — which is why single-member LLCs face more practical scrutiny than multi-member LLCs even where the legal test is identical on paper.
Watch this one closely: the Tennessee Supreme Court significantly overhauled the state's veil-piercing standard in Youree v. Recovery House of East Tennessee, LLC, 705 S.W.3d 193 (Tenn. 2025) — a very recent decision (2025) that reworks how Tennessee courts evaluate the unity-of-interest and fraud-or-injustice prongs of the traditional test. Because this is so new, treat Tennessee's alter-ego risk level as a live, developing area rather than settled precedent, and expect lower courts to keep clarifying exactly how Youree applies to single-member LLCs specifically over the next several years.
Formalities to maintain: keep a dedicated business bank account and never commingle personal and LLC funds, sign every contract and check in the LLC's name (not your own), maintain a written operating agreement even though it isn't required, keep basic records of major decisions and distributions, and adequately capitalize the LLC for the business it actually runs — all the more important while Youree's exact contours are still being worked out in the lower courts.
Can a Tennessee Single-Member LLC Use a Series Structure?
Yes. Tennessee authorizes series LLCs under T.C.A. § 48-249-309, letting a single parent LLC create internally-segregated series, each shielded from the others' liabilities under one formation filing. For a single-member owner running multiple properties or business lines, a Tennessee series LLC can wall off each line's liability without filing and maintaining a separate LLC for each one.
Does Tennessee Have a Law Written Specifically for Single-Member LLCs?
Yes — T.C.A. § 48-249-203(c) explicitly addresses single-member LLCs, confirming that a solo owner may adopt an operating agreement between the member and the LLC and will be bound by it. This is meaningfully more explicit sole-member language than many states include, though it stops short of Wyoming's charging-order-specific inclusion.
How Is a Tennessee Single-Member LLC Taxed?
By default, the IRS disregards a single-member LLC for federal tax purposes — you report business income on Schedule C of your personal return, and you'll owe self-employment tax (Social Security and Medicare) on net earnings. You can elect corporate taxation instead by filing Form 8832 (C-corp) or Form 2553 (S-corp) if that fits your situation better — but unlike a multi-member LLC, a single-member LLC can never elect partnership taxation, since that requires more than one owner.
Tennessee has no personal income tax on wages, and the Hall Tax (a 6% tax that applied only to interest and dividend investment income) was fully repealed effective January 1, 2021 — Tennessee became the second state after Alaska to eliminate personal income tax of every kind. A single-member LLC owner owes no state-level income tax on the LLC's pass-through profit, only federal income tax and federal self-employment tax.
Tennessee LLCs owe an annual report fee of $50 per member, with a $300 minimum (so a single-member LLC pays the $300 minimum, not $50). Separately, Tennessee's Franchise & Excise (F&E) Tax applies to most LLCs — a 6.5% excise tax on net earnings plus a 0.25% franchise tax on net worth. Get this nuance right: a single-member LLC disregarded for federal tax purposes is exempt from F&E tax only if its sole member is itself a corporation — an individually-owned disregarded single-member LLC (the far more common case) is generally NOT exempt, despite what some generic content implies about disregarded entities automatically escaping entity-level tax.
Does My Tennessee SMLLC Need an EIN?
Technically, a single-member LLC with no employees can use the owner's SSN for federal tax filing purposes. In practice, get an EIN anyway (it's free and instant from the IRS) — nearly every Tennessee bank requires one to open a business account, and using an EIN instead of your SSN keeps your personal information off business paperwork and vendor forms.
The Tennessee Supreme Court's 2025 decision in Youree v. Recovery House of East Tennessee, LLC significantly reworked the state's veil-piercing standard — this is recent enough that lower courts are still applying it, so treat Tennessee's alter-ego risk assessment as an active watch-item rather than settled law.
How to Set Up Your Tennessee Single-Member LLC
If You Do It Yourself
Step 1 — File your Articles of Organization.
Form your LLC the same way any other Tennessee LLC is formed — the state doesn't use a different form or process for single-member LLCs.
Step 2 — Appoint a registered agent.
Tennessee calls this role a "Registered Agent" — you can serve as your own if you have a physical in-state address, or use a commercial service for privacy and reliability.
Step 3 — Draft an operating agreement built for a solo owner.
No, but Tennessee's statute goes out of its way to validate a solo owner's agreement. T.C.A. § 48-249-203(c) states: "An LLC with a single member may adopt, and, if so, shall be bound by, an operating agreement between the member and the LLC" — explicit statutory language confirming a one-person operating agreement is just as enforceable as a multi-member one, even though it isn't legally required. A Tennessee operating agreement can name a successor member and include transfer-on-death language, letting your LLC interest pass to an heir without going through Tennessee probate — worth including even though Tennessee doesn't require the document itself.
Step 4 — Understand your charging-order exposure.
Yes, per a clean statute, though not yet tested by a Tennessee court in a single-member-LLC-specific fact pattern the way Florida's Olmstead tested Florida's. T.C.A. § 48-249-509 makes the charging order the "sole and exclusive remedy" of a judgment creditor against a member's interest, limits the creditor to a receivership-style claim on distributions, and grants no foreclosure or voting rights — and it applies to "a member" without regard to the number of members in the LLC. No Tennessee case law has carved single-member LLCs out of this protection.
Step 5 — Maintain formalities to avoid alter-ego risk.
keep a dedicated business bank account and never commingle personal and LLC funds, sign every contract and check in the LLC's name (not your own), maintain a written operating agreement even though it isn't required, keep basic records of major decisions and distributions, and adequately capitalize the LLC for the business it actually runs — all the more important while Youree's exact contours are still being worked out in the lower courts.
Step 6 — Get an EIN and open a business bank account.
Technically, a single-member LLC with no employees can use the owner's SSN for federal tax filing purposes. In practice, get an EIN anyway (it's free and instant from the IRS) — nearly every Tennessee bank requires one to open a business account, and using an EIN instead of your SSN keeps your personal information off business paperwork and vendor forms.
Step 7 — Handle ongoing state compliance.
Tennessee LLCs owe an annual report fee of $50 per member, with a $300 minimum (so a single-member LLC pays the $300 minimum, not $50). Separately, Tennessee's Franchise & Excise (F&E) Tax applies to most LLCs — a 6.5% excise tax on net earnings plus a 0.25% franchise tax on net worth. Get this nuance right: a single-member LLC disregarded for federal tax purposes is exempt from F&E tax only if its sole member is itself a corporation — an individually-owned disregarded single-member LLC (the far more common case) is generally NOT exempt, despite what some generic content implies about disregarded entities automatically escaping entity-level tax. Tennessee has no personal income tax on wages, and the Hall Tax (a 6% tax that applied only to interest and dividend investment income) was fully repealed effective January 1, 2021 — Tennessee became the second state after Alaska to eliminate personal income tax of every kind. A single-member LLC owner owes no state-level income tax on the LLC's pass-through profit, only federal income tax and federal self-employment tax.
Step 8 — Watch for Tennessee-specific SMLLC traps.
The most common Tennessee-specific mistake is assuming a single-member LLC that's a disregarded entity for federal tax purposes automatically escapes the state's Franchise & Excise Tax. It doesn't — that exemption only applies when the sole member is itself a corporation. An individual owner's disregarded single-member LLC generally still owes F&E tax, a detail that trips up first-year Tennessee LLC owners more than almost any other state-specific quirk in this guide.
If LLC Attorney Does It for You
- Submit your business details at llcattorney.com — LLC name, registered agent, and ownership information.
- LLC Attorney forms your Tennessee single-member LLC and drafts a solo-owner operating agreement, including transfer-on-death provisions to keep your business out of probate.
- Receive your finished formation documents, EIN, and operating agreement, plus access to flat-fee attorney consultations (no retainer) for asset-protection questions as your business grows.
When Should You Talk to an Attorney About Your Tennessee Single-Member LLC?
Talk to an attorney before finalizing your Tennessee single-member LLC's structure if you want to understand how the 2025 Youree veil-piercing standard might apply to your specific business, if you're confirming whether your LLC's Franchise & Excise Tax exemption analysis is correct (individual-owned disregarded LLCs are generally NOT exempt — a common point of confusion), or if you're considering a Tennessee series LLC to segregate liability across multiple properties or business lines.
What You Actually Get With LLC Attorney's Tennessee SMLLC Formation
The part of forming a Tennessee single-member LLC that generic templates miss is the Franchise & Excise Tax exemption trap — most formation content assumes a disregarded entity automatically escapes Tennessee's entity-level tax, when in fact that exemption only applies if the sole member is a corporation. LLC Attorney builds your tax expectations around the actual rule.
- Single-member LLC formation in Tennessee, starting at $0 + state fees.
- Solo-owner operating agreement with transfer-on-death provisions, starting at $49.
- Charging-order, alter-ego, and tax considerations addressed for your specific state — not a generic multi-state template.
- Access to professionally trained Business Success Advisors at no charge, plus flat-fee attorney consultations (no retainer) for asset-protection questions.
Tennessee gives single-member LLC owners a clean charging-order statute and no state income tax — LLC Attorney makes sure your formation accounts for the Franchise & Excise Tax nuance and the evolving Youree veil-piercing standard from day one.
Ready to Form Your Tennessee Single-Member LLC?
LLC Attorney forms single-member LLCs in Tennessee and drafts an operating agreement built for a solo owner, starting at $0 + state fees. See our full pricing for all service tiers.
Frequently Asked Questions
Yes, per a clean statute. T.C.A. § 48-249-509 makes the charging order the sole and exclusive remedy against a member's interest, applying to "a member" without regard to the number of members — no Tennessee case has carved single-member LLCs out of this protection the way Florida's Olmstead did.
No, but Tennessee's statute (T.C.A. § 48-249-203(c)) explicitly confirms a single-member LLC may adopt an operating agreement between the member and the LLC and will be bound by it, even though a written one isn't legally required.
Watch this closely — the Tennessee Supreme Court significantly overhauled the state's veil-piercing standard in Youree v. Recovery House of East Tennessee, LLC, 705 S.W.3d 193 (Tenn. 2025), a very recent decision still being interpreted by lower courts. Keep clean formalities regardless of how the standard settles.
Yes. T.C.A. § 48-249-203(c) explicitly addresses single-member LLCs, confirming a solo owner's operating agreement is valid and binding — more explicit sole-member language than many states include, though it doesn't extend to the charging-order statute the way Wyoming's does.
No. Partnership taxation requires at least two members. A Tennessee single-member LLC can only be taxed as a disregarded entity (the default), or elect C-corp or S-corp taxation instead — remember that the LLC still generally owes Tennessee's Franchise & Excise Tax regardless of which federal election you make, unless the sole member is itself a corporation.
Technically optional if the LLC has no employees (you can use your SSN instead), but get one anyway — it's free from the IRS, nearly every Tennessee bank requires it to open a business account, and it keeps your SSN off business paperwork.
Yes. Your operating agreement can name a successor member and include transfer-on-death language, letting your LLC interest pass to an heir outside of Tennessee's probate process — even though Tennessee doesn't require the operating agreement itself.
Generally no — Tennessee's charging-order statute doesn't distinguish single- from multi-member LLCs, so adding a nominal second member wouldn't clearly change your charging-order protection here the way it might in Florida. Note also that adding a second member could actually work against you on the Franchise & Excise Tax exemption analysis, since that exemption turns on the sole member being a corporation. Discuss with an attorney before adding a member for tax or asset-protection reasons.
Yes. LLC Attorney forms single-member LLCs in Tennessee, including a solo-owner operating agreement, starting at $0 + state fees.