Due to its adaptability and tax advantages, a limited liability company, or LLC, is a common business structure among entrepreneurs. An LLC is regarded as a pass-through entity in Wisconsin for taxation purposes, which means that the business’s gains and losses are transferred to the owners’ individual tax returns.
An LLC is taxed differently depending on how many owners it has than a corporation, which is treated as a separate entity. The LLC is taxed as a single proprietorship if there is just one owner. The LLC is taxed as a partnership if it has numerous owners.
The LLC in Wisconsin is required to submit a yearly report to the Department of Financial Institutions and pay a $25 annual fee. The LLC must also register for Wisconsin state taxes, including sales tax and employer withholding tax, and get a tax identification number from the IRS.
An LLC or corporation are examples of legal entities; a DBA, or doing business as, is not. Instead, it is a technique for a company to operate under a name other than its official name. Multiple owners are permitted for a DBA, but it does not offer the same liability protection as an LLC.
The legal name of the person or business must be stated when filing a DBA. The whole name of a person, including any middle names or initials, constitutes their legal name. The name listed in the formation documents for an entity, such as the articles of incorporation or articles of organization, is known as the legal name.
A DBA credential is not an official accreditation or authorization. It just means registering a DBA with the relevant government office, such as the Secretary of State’s office or the county clerk’s office. A firm can use a name other than its legal name by registering a DBA, which can be advantageous for branding and marketing.
You can open a business account under your own name or your DBA name as a lone proprietor, yes. However, in order to avoid confusion and preserve a professional image, it is advised to use your DBA name for commercial transactions. Additionally, setting up a separate company account might aid in tax planning and recordkeeping.
If you have established an LLC, it is not advised to do business using your personal bank account. To avoid confusion or legal difficulties, it’s crucial to keep your personal and business finances separate. For any business-related transactions, you should open a unique bank account for your LLC.