Whether you form a single-member or multiple-member LLC is not just a function of the number of people involved. Because of the advantages and disadvantages of each, a single business owner might want to form a multiple-member company and multiple people might want to form single-member companies.
For example, a person with a one-person business who wants to start a multiple-member LLC to gain asset protection, might want to make his spouse, parent, or child a member. Two people who own several properties as separate LLCs might want to make them single-member LLCs owned by one multiple-member LLC to avoid filing a separate tax return for each.
You will have an operating agreement whether you are a single or multiple-member company. But for a multiple-member company, you need to be more careful to spell out each others' rights in the event of a split-up, death, or an irreconcilable disagreement.
Taxes
A single-member LLC is easier for tax purposes because no federal tax return is required, unless the business decides to be treated as a corporation for tax purposes. The income is reported on the member's tax return. A multiple member LLC must file tax return, and give the members K-1 forms to file with their returns.
