Tenn. Code Ann. § 48-101-701 Short title.
48-101-701. Short title.
This part shall be known and may be cited as the “Nonprofit Limited Liability Company Act of 2001.”
Acts 2001, ch. 418, § 1.
Nonprofit Limited Liability Company Act of 2001
Tenn. Code Ann. tit. 48, ch. 101, pt. 7
in effectTenn. Code Ann. § 48-101-702 Part definitions.
48-101-702. Part definitions.
As used in this part, unless the context otherwise requires:
(1) “Limited liability company” or “LLC” means a limited liability company, foreign or domestic, organized under or subject to the Tennessee Limited Liability Company Act, compiled in chapters 201-248 of this title;
(2) “Nonprofit corporation,” for the purposes of this part, means a nonprofit corporation, foreign or domestic, incorporated under or subject to chapters 51-68 of this title and exempt from franchise and excise tax as not-for-profit as defined in § 67-4-2004;
(3) “Nonprofit limited liability company” or “nonprofit LLC” means a limited liability company:
(A) That is disregarded as an entity for federal income tax purposes; and
(B) Whose sole member is a nonprofit corporation, foreign or domestic, incorporated under or subject to chapters 51-68 of this title and who is exempt from franchise and excise tax as not-for-profit as defined in § 67-4-2004;
(4) “Parent nonprofit corporation” means a nonprofit corporation that is the sole member of a nonprofit corporation; and
(5) “Subsidiary nonprofit corporation” means a nonprofit corporation whose sole member is a nonprofit corporation.
Acts 2001, ch. 418, § 1.
Tenn. Code Ann. § 48-101-703 Application.
48-101-703. Application.
The Tennessee Limited Liability Company Act, compiled in chapters 201-248 of this title shall apply to nonprofit limited liability companies, both domestic and foreign, to the extent not inconsistent with this part.
Acts 2001, ch. 418, § 1.
Tenn. Code Ann. § 48-101-704 Organization as a nonprofit LLC.
48-101-704. Organization as a nonprofit LLC.
A nonprofit corporation may organize a nonprofit LLC by filing articles of organization prominently designating it as a nonprofit limited liability company with the office of the secretary of state consistent with the Tennessee Limited Liability Company Act; provided, that an LLC shall qualify as a nonprofit LLC only if the LLC is disregarded as an entity for federal income tax purposes. No more than one (1) nonprofit corporation may be a member of a nonprofit LLC.
Acts 2001, ch. 418, § 1.
Tenn. Code Ann. § 48-101-705 Standard of conduct for LLC members — Indemnification — Limitation on actions — Application to private foundations.
48-101-705. Standard of conduct for LLC members — Indemnification — Limitation on actions — Application to private foundations.
(a) The standards of conduct established in §§ 48-58-301, 48-58-302, 48-58-303, and 48-58-403 applicable to the directors, officers, employees and agents of the nonprofit corporation that is the sole member of a nonprofit LLC shall likewise apply to the governors, managers, employees and agents of the nonprofit LLC.
(b) The indemnification provisions of chapter 58, part 5 of this title applicable to the directors, officers, employees and agents of the nonprofit corporation that is the sole member of a nonprofit LLC shall likewise apply to the governors, managers, employees and agents of the nonprofit LLC.
(c) The limitation of actions and immunity from actions provided in chapter 58, part 6 of this title applicable to the directors, officers, trustees and members of the nonprofit corporation that is the sole member of a nonprofit LLC shall likewise apply to the governors and managers of the nonprofit LLC.
(d) The attorney general and reporter shall have such authority, rights and obligations over nonprofit LLCs as the attorney general and reporter has over nonprofit corporations pursuant to chapters 51-68 of this title.
(e) If the nonprofit corporation that is the sole member of the nonprofit LLC is a “private foundation” as defined in § 509(a) of the Internal Revenue Code of 1986 (26 U.S.C. § 509(a)), the requirements of § 48-51-501 shall likewise apply to the nonprofit LLC.
Acts 2001, ch. 418, § 1; 2014, ch. 899, § 95.
Tenn. Code Ann. § 48-101-706 Limitation on tax liability — Annual filings.
48-101-706. Limitation on tax liability — Annual filings.
Consistent with § 67-4-2007(d) for excise tax purposes and § 67-4-2106(c) for franchise tax purposes, a nonprofit LLC shall be disregarded as an entity separate from the nonprofit corporation that is the sole member of the nonprofit LLC for purposes of all state and local Tennessee taxes. The nonprofit LLC shall file annual reports and other filings with the office of the secretary of state as required of all LLCs.
Acts 2001, ch. 418, § 1.
Tenn. Code Ann. § 48-101-707 Conversion of subsidiary nonprofit corporations.
48-101-707. Conversion of subsidiary nonprofit corporations.
(a) A subsidiary nonprofit corporation incorporated in this state may be converted to a nonprofit LLC pursuant to this section.
(b) The terms and conditions of a conversion of a subsidiary nonprofit corporation to a nonprofit LLC must be approved by the board of directors of the subsidiary nonprofit corporation and the parent nonprofit corporation.
(c) After the conversion is approved under subsection (b), the subsidiary nonprofit corporation shall file articles of conversion with the office of the secretary of state that satisfy the requirements of § 48-205-101, and designate the LLC as a nonprofit limited liability company. Such articles shall also include:
(1) A statement that the nonprofit corporation was converted to a nonprofit LLC;
(2) The name and principal address of the former nonprofit corporation; and
(3) A statement that the terms and conditions of the conversion have been approved by the board of directors of the subsidiary nonprofit corporation and the parent nonprofit corporation.
(d) The conversion is effective when the articles of conversion are filed with the secretary of state or at any later date on or before ninety (90) days from filing of the articles of conversion if specified in such articles. The filing of articles of conversion with the secretary of state, in compliance with this section, shall constitute and, for purposes of chapter 64 of this title, be deemed to be a certificate of cancellation of the subsidiary nonprofit corporation.
(e) Articles of conversion shall be amended in the same manner as the articles of organization of a limited liability company.
Acts 2001, ch. 418, § 1.
Tenn. Code Ann. § 48-101-708 Effect of conversion.
48-101-708. Effect of conversion.
(a) Upon the effective date of the conversion from a subsidiary nonprofit corporation to a nonprofit LLC:
(1) All property owned by the converting nonprofit corporation remains vested in the nonprofit LLC;
(2) All obligations of the converting nonprofit corporation continue as obligations of the nonprofit LLC; and
(3) An action or proceeding pending against the converting nonprofit corporation may be continued as if the conversion had not occurred.
(b) The converting nonprofit corporation shall not be required to wind up its affairs or to pay its liabilities and distribute its assets, and such conversion shall be deemed to constitute a dissolution of such subsidiary nonprofit corporation.
(c) The ownership interests or membership of the parent nonprofit corporation in the subsidiary nonprofit corporation shall become membership interests in the nonprofit LLC.
Acts 2001, ch. 418, § 1.
Source: Tennessee Code (state release 76 via Public.Resource.Org) + public chapters (Tennessee Secretary of State)URL: https://archive.org/download/gov.tn.tca/release76.2021.05.21/gov.tn.tca.title.48.htmlFetched: 10/24/2026