The simplest and most typical type of business ownership in Michigan is setting up as a single proprietorship. In this post, we’ll walk you through the procedures necessary to establish a sole proprietorship in Michigan and address some associated queries.
The first step is to select a business name. Selecting a company name is the first step in setting up a sole proprietorship in Michigan. You must select a name that is not being used by another company in Michigan. Use the Corporations Division website of the Michigan Department of Licensing and Regulatory Affairs (LARA) to see if the name is available.
Step 2: File a Business Registration Form You must register your business with LARA after deciding on a name. This can be done by mail or online. The enrollment cost is $10. Additionally, you’ll need to apply for any business-related licenses or permissions from the relevant municipal or state authorities.
Get an Employer Identification Number (EIN) in step three. The Internal Revenue Service (IRS) issues an Employer Identification Number (EIN), a special nine-digit number, to identify your company for tax purposes. This number is required in order to open a bank account, recruit staff, and file taxes. The IRS website offers a free EIN service.
Opening a business bank account is step four. It’s crucial to register a separate company bank account in order to separate your personal and corporate finances. This will assist you in maintaining precise records of your earnings and outgoings.
Can a DBA Have More Than One Owner? A DBA (Doing Business As) may really have more than one proprietor. It is crucial to remember that a DBA is merely a mechanism for a firm to conduct operations under a different name; it is not a legal organization. If you have numerous owners, you might want to think about establishing an LLC or partnership instead. Can Two Companies Use the Same DBA Name?
No, in Michigan, two firms cannot share the same DBA name. A DBA is used to set one firm apart from another. Customers may become confused and there may be legal repercussions if two businesses share the same name. What is the assumed name for the business type?
A legal document known as a “Business Type Assumed Name” enables a company to conduct business under a name different than its legal name. A DBA is another name for this. It is crucial to remember that a DBA does not give the company name any legal protection.
The name that appears on the paperwork used to register a business is its legal name. In addition to its legal name, a business may operate under another name, or DBA. A DBA enables a company to conduct operations under a different name for branding or marketing reasons.
You are not required to use your legal name if you are a sole proprietorship in Michigan. However, if you decide to operate under a name other than your legal name, you must file a “doing business as” (DBA) registration with the state of Michigan. This enables you to run your company under a fictional name or trade name.