LLC VS DBA VS SOLE PROPRIETOR

 Upadated on 01/4/2011

Starting a business requires that you select a business legal structure such as a sole proprietorship ( DBA), LLC, partnership or corporation.  There are advantages and disantadvantages to each of the above..  Here is a break down analysis.

What is a DBA

A DBA filing is the registration of a trade name.  For example, if you do business as "plumbing king," you will need to register it because it is a trade name.   

Sole proprietorships and general partnerships need to file a DBA otherwis, the company name will be the same as the name(s) of owner(s). For example, John Doe is operating a Painting business as a sole proprietorship. He files a DBA to do business under the name Doe's Painting but he could use his first and last name but it is not recommended.

Filing a DBA vs.  Forming an LLC

Selecting a structure goes withgGiving a Name to your  business  and it is the first step you have to take when you start a business.  Most advisors recommend that your business name should  portray what your business is engaged in, be easy to remember and help clients find you.  Regardless of the time you put in to select a name, it might have to eventually change and grow with your business growth.  If you have to keep your LLC name and also want other names under it to reflect a department of your business, you may wonder whether filing a DBA (doing business as, which is also sometimes called an assumed name or fictitious name) or forming your business as limited liability company (LLC) is the way to go about it.  

I am doing Building Repairs&Coatings Supply expertise and Product so customer can make repairs. Home Business I will not have Product at my home, I will orer it from the Supplier and ship direct to the end user. I will cover Industries in CT and RI. I don't believe I need any License.

Corporations and LLCs can also transact business under a name different from the LLC or Corporation name. For example, ABC, Inc. may wish to transact business under a name that reflects the product or service the company provides, such as The Grocery King Market, and could file a DBA to use the more descriptive name. A DBA filing has no effect on the official name of the corporation or LLC.   A DBA filed under an LLC or Corporation is in addition to or instead of the official corporate or LLC name.  

 Your business is subject to sales tax reporting because it is selling touchable objects that are required to be reported to the state and that requires a resale id to do so. For this reason, here are the licenses and tax ids you are legally required to obtain before starting business operations: 1. A business tax registration license. (Form an LLC Limited Liability Company to protect Your Home and Car) 2. Fictitious Business Name, DBA assumed business name 3. A federal tax id number also is required in most state for those that they get a seller's permit, and if you are a partnership or you want to use it instead of you social security number to open a bank account. Also, note that forming an llc or incorporating eliminates the requirement of getting a dba. It is a good idea to form an llc to avoid personal liability from business transactions. Since you are dealing in taxable items, you will need 4. A seller's permit.

Filing a DBA or forming a new corporation or LLC is required but the question may be what is the right choice  and that often depends on your particular business needs, your current financial situation and your business type.

 It is recommended you get the advice of an attorney or accountant but since this may be beyond your means, you may want to file your DBA, LLC or Corporation, here online for a low and reasonable price.. 
 

A sole proprietorship and general partnership is not a corporate entity and thus filing for a DBA as a sole proprietor or partnership does not provide the same benefits that forming a corporation or LLC does. Filing a DBA merely allows the company to transact business with the trade name. For corporations and LLCs, filing a DBA is just a trade name under the LLC and has no bearing whatsoever on the entity to use a different name.  In fact, an LLC or Corporation can file as many names as it wishes under them.

Corporation or LLC Formation

The formation of an LLC or corporation occurs when  the articles of incorporation for corporations and the articles of organization for LLCs are filed with the appropriate state government agency.

Sole owners or general partnerships first consider using a different name, it is often a good time to consider  incorporating the business or forming an LLC as the best next step. The corporate and LLC structures provide corporate protections and advantages to the owner(s) of the business that sole proprietorships and general partnerships do not.

Corporate and LLC Advantages:

• Limited liability protection
• Tax advantages
• Credibility with potential customers, vendors, partners, and employees
• Raising of Capital
• Current corporations and LLCs

$99  to $300 or more.