Understanding the Difference between Legal Name and DBA

What is the difference between legal name and DBA?
DBA means “”doing business as.”” A DBA is any registered name that a business operates under that isn’t its legal business name. A DBA is sometimes called a trade name, fictitious name, or assumed name. A DBA isn’t a business structure and doesn’t provide any personal asset protection like an LLC or corporation.
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Choosing a name for the company is one of the first stages in launching a business. This name will be used on all legal papers and to identify the company to the general public. You can come across terminology like “legal name” and “DBA” during this process. Before choosing a choice, it is crucial to comprehend the distinction between these two concepts. legally known as: The name that appears on the paperwork used to register a business is its legal name. This name is used to identify the company for legal and tax purposes and is registered with the state. All legal documents, including contracts, tax filings, and licenses, utilize the legal name.

DBA:

The term “doing business as,” commonly referred to as a trade name or fictional business name, stands for “doing business as.” A DBA is the name under which a company conducts business. A DBA is a name that a business uses to identify itself to the public; it is not the official name of the company. For instance, John Smith’s legal name would be John Smith if he is a lone proprietor who operates a business under his own name. He would have to file a DBA if he chose to run his company under a different name, such “Smith’s Services.” In this instance, Smith’s Services would be the DBA and John Smith would be the legal name.

Can a Sole Proprietorship Have More Than One DBA?

Yes, you are allowed to use numerous DBAs as a sole proprietor. If you run many businesses or wish to use a different name for marketing reasons, this can be helpful. However, the state requires that each DBA be registered separately.

Do I Need a Business Bank Account If Self Employed? as a result, you are not required by law to establish a separate business bank account if you are a sole proprietor. Keeping your personal and business finances separate is strongly advised. For tax purposes, this will make it simpler to keep track of your business’s expenses and revenue.

Do I Have to Register a DBA in Massachusetts, Also?

Yes, you must register a DBA in Massachusetts if you are doing business under a name other than your own. The Corporations Division of the Commonwealth Secretary handles this.

How Do I Create One LLC for Multiple Businesses? You can register each firm as a subsidiary LLC under the parent company if you wish to operate all of your enterprises under one LLC. To do this, first create a parent LLC. Each business can benefit from both financial and legal protection as a result of operating under one roof.

In conclusion, it’s important to grasp the distinction between a legal name and a DBA before launching a firm. You can register more than one DBA as a sole proprietor, but each one needs to be done so separately with the state. To keep personal and business finances distinct, it is advised to open a separate corporate bank account. If you are doing business in Massachusetts under a name other than your own, you must register a DBA. Finally, you can manage all of your businesses under one LLC by setting up a parent LLC and registering each one as a subsidiary LLC if you own many companies.

FAQ
Then, how does a dba work?

The term “doing business as” (DBA) refers to a false name that a company adopts in place of its legal identity. A DBA allows a company to use a name other than the one that is officially registered with the government. For companies that desire to operate under a different name or brand for marketing or other purposes, this can be helpful. A business owner normally needs to file a fake business name statement and register the DBA with the relevant state or local agency in order to use it. The DBA can be used by the company in its operations legally after registration.