A fictitious name, often referred to as a “Doing Business As” designation or DBA, is a trade name used by companies in the marketplace or legal arena. A company that is doing business as a particular entity with a name other than their original, corporate name is operating under a fictitious name.
If your business wants to set up a new store, office or any other entity under a new name, you should always properly register your DBA in order to ensure no other company will try to use that name for their own purposes. It will also protect you as a legitimate business when handling legal and banking transactions.
There are several advantages to filling out and properly filing DBA forms any time your business wants to begin operating under a new name, including:
- A DBA is far less expensive than incorporating your new name as a separate business.
- A company that is “doing business as” another entity allows business owners to mingle funds, operating costs and profits rather than having to separate the two entities completely.
- It protects you from infringement on your DBA name by other companies or individuals.
- It allows you to collect payments and open and operate bank accounts under your DBA name.
An LLC is a type of business entity that combines several characteristics of a corporation and a partnership. As the name suggests, an LLC offers personal liability protection to its owners for company debts and liabilities.
An LLC also offers flexibility to its owner in that the owners can elect to be taxed either as a partnership or as a corporation and the owners can choose how the LLC will be managed. The creation of an LLC generally requires the preparation of certain documents that are filed with the Secretary of State (or other appropriate department) in your state of organization.
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