Help with Structure
STRUCTURE: Assumed Name (DBA)
Structure: Assumed Name (DBA: doing business as)
Now that we have selected and secured our Business Name, now it’s time to become a legal entity. For many, we must decide how we will structure our business. This determination is based upon WHERE you plan to do business, the LIABILITY or RISK your business imposes. Another consideration is HOW you will be taxed.
Again, thinking three (3) years into the future, you must determine whether filing an Assumed Name or DBA is the proper or correct structure for your business.
To file an Assumed Name or DBA, you will complete a simple form with your county’s recorder or county’s clerk office. In most states, this structure has an expiration date (check with your county’s clerk for more information). Finally, if you plan to “take the world by storm” with your business, then this business structure filing may not be the appropriate filing for you. Read! Read! Read. In most states, you can only do business in the county (ies) were you filed.
Liability and Risk:
It is important that you consider the liability and risk that your business imposes. Sometimes, improper filing can place us in a world of trouble. In this country, a lawsuit can be filed for just about anything and for any reason. Though you may believe that you have a great product or service and that everyone will enjoy it immensely, we must always protect ourselves wisely.
Also consider if you own real property, have annuities, a possible inheritance, or real assets that could be considered in the event of a suit or loss. If this is the case, an Assumed Name or DBA may not be the correct business structure filing.
Once you file your business structure, you are now a business owner. Your next step is to obtain an Employer Identification Number (EIN). You may obtain this number free of charge by contacting the Internal Revenue Service (IRS). Or, you can go online to file. www.irs.gov. Use this number on your invoices, receipts you give to your customers and on all of your tax forms.
REMEMBER: You have a business now. You are responsible for keeping track of receipts, records, filing business tax returns, and paying taxes (if warranted). Do not include your social security number for business purposes. Use your EIN.