Do You Have to Register a Sole Proprietorship in VA?

One of the first things you should think about when starting a business in Virginia is whether or not you need to register your sole proprietorship. Both yes and no, is the answer. Technically, registering a sole proprietorship in Virginia is not required by law. There are, however, some situations in which registering might be required or advantageous.

For instance, you must register a trade name or “doing business as” (DBA) name with the Virginia State Corporation Commission if you intend to use one that differs from your legal name. It’s crucial to do this since it will stop another company from using the same name and enable you to register a business bank account under your trade name.

Do DBAs pay taxes in this regard? A DBA is not a legal entity, hence it does not pay taxes. Instead, it is a name that a company employs to conduct business under anything other than the owner’s legal identity. The business owner will include payment of any taxes payable in their personal tax return.

Can more than one firm operate under the same EIN? Yes, you are permitted to operate more than one business under the same EIN. But every firm needs to be a distinct legal organization, such an LLC or corporation. You are not allowed to operate more than one sole proprietorship under one EIN.

What’s the most DBAs an LLC can have? Multiple DBAs are permitted for an LLC, but each one needs to be registered with the state. You must register both of your LLC’s trade names with the state, for instance, if it runs two distinct businesses under two different trade names.

So what constitutes a DBA as an example? As an illustration of a DBA, consider John Smith starting a landscaping company under the name “Green Thumb Landscaping” rather than his own name. He would have to file “Green Thumb Landscaping” with the Virginia State Corporation Commission as a trade name.

Conclusion: Though it is not legally compulsory to register a sole proprietorship in Virginia, there are instances in which doing so might be advantageous or necessary. When operating numerous businesses, each one must be a distinct legal entity and be registered with the state if you intend to use a trade name. You can make sure that your company is operating lawfully and benefiting from all advantages by being aware of these regulations.