LLC members and corporate officers: who qualifies for a Florida exemption

By Adrian Middleton, Sword & Shield, PLLC · Updated Monday, October 19, 2026

Corporate officers

An officer of a corporation who performs services for pay is an employee unless they elect exemption (s. 440.02(18)(b)1). To elect, the officer must be listed as an officer in the Division of Corporations records (s. 440.05(10)) and must file the notice personally. Outside construction there is no limit on the number of exempt officers and no ownership requirement in the statute, though the Sunbiz listing is mandatory.

In the construction industry, section 440.02(18)(b)2 adds two limits: no more than three officers of a corporation, or of any group of affiliated corporations, may be exempt, and each must be a shareholder owning at least 10 percent of the stock. Officers beyond three, or holding less than 10 percent, are employees who must be covered.

LLC members

Section 440.02(11) treats a member of a limited liability company who owns at least 10 percent of the company as a corporate officer for purposes of the exemption. The same construction limits apply: at most three exempt members per LLC or affiliated group. A member owning 5 percent cannot be exempt in any industry, and an LLC manager who is not a member is not covered by the sentence at all.

Affiliated companies

The three-officer limit counts across any group of affiliated corporations. Section 440.02(18)(b)2 treats entities under common control as affiliated, and shared equipment or income is prima facie evidence of affiliation. Splitting one roofing crew into Smith Roofing, Inc., Smith Roofing II, Inc. and Smith Roofing III, Inc. to get nine exemptions does not work, and the Division's affiliation finding is the kind of thing that turns a penalty case into a fraud referral.

S-corps, P.A.s and professional associations

Tax elections do not matter. An S-corporation is a corporation; its officers are corporate officers. A professional association is a corporation. A single-member LLC taxed as a disregarded entity is still an LLC whose sole member owns 100 percent and may elect exemption.

Partners and sole proprietors

A partnership and a sole proprietorship have no officers and no members, so there is no exemption to file. Outside construction, partners and sole proprietors are not employees unless they elect in (s. 440.05(2)). In construction, a sole proprietor or partner who works for a contractor is that contractor's employee (s. 440.02(18)(c)) unless they carry their own policy. The route to an exemption is to form a corporation or LLC, list yourself on Sunbiz, and file as an officer or member. See who is exempt.

Officers who do not qualify

A fourth construction officer, an officer under 10 percent, or a member not on Sunbiz is an employee. Their payroll must be covered, and if it is not, it is penalty payroll in a stop-work order. Some companies solve this by putting the non-qualifying officer on the policy; a policy covering one officer and no field workers is inexpensive. Others restructure ownership. What does not work is paying them as a 1099 subcontractor, which in construction changes nothing (s. 440.02(18)(c)) and adds a $5,000 misrepresentation penalty per worker (s. 440.107(7)(f)).

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