Do I need to file for a DBA?

Posted by Uni Aguilar on Tue, Aug 20, 2013 @ 20:08 PM

In continuation of our series of articles from my friend Jim Betinol from Withrow & Betinol Law we share an article that discusses DBAs, or Doing Business As. The purposee of these articles is to emphasize that is not merely enough to have business insurance, but other aspects that surround your business lay the ground work and foundation in which your business is founded on. You can make $1,000,000.00 in the year, but you can also lose it all and more because of a tehcnicality or mistake.

August 20, 13 

Do I need to file for a DBA?

Also referred to as a Fictitious Business Name, Doing Business As (DBA) is a required filing that lets the public know the true owner of a business.  It was created to provide a form of consumer protection against those dishonest business owners operating under a different name to avoid legal trouble.

Who needs a DBA?

Generally, there are two situations in which your business will need to file a DBA:

A. If you are a sole proprietor or partnership operating a business using a name that is different from your own personal name(s). 

Example 1:

John Doe wants to open a coffee shop called “Bean Café.”  Under this situation, John would need to file a DBA since his operating a business under a name that is different form his own personal name. 

Alternatively, if John Doe decides use the name “John Doe’s Café,” he may not need to file a DBA since his operating the business under his own personal name. 

Example 2:

John Doe wants to open an auto repair shop, called “John Doe and Family Auto body” or “John’s Auto body.”  Under these two situations, John would need to file a DBA since the business either implies a larger group unnamed owners and/or ambiguous.   

B. If you have formed a limited liability company or have incorporated your business and is operating the business under a name that is different from the name of the company or LLC registered with the State.

Example 1:

John Café, LLC decides to open a store called “Coffee Bean Café,” or “johncoffeeroaster.com.”  Under this situation, John would need to file a DBA for the other names.

Where and when do you file a DBA? 

DBA’s are generally filed with your local county clerk’s office, will include a small filing fee to the clerk and an additional expense to publishing your DBA filing with an approved newspaper to satisfy the public notice requirement of DBAs.  Consult with your local clerk’s office for further details. 

DBA’s should be filed before any business is conducted using the name.  Some jurisdictions may allow a grace period before assessing penalties, but it is important to have your DBA filed from the start because it is necessary for using the name in contracts, bank accounts, licenses and permits.

Written by Guest Writer: Jim Betinol, Partner at Withrow & Betinol Law

Tel: 424-229-2560

Email: betinol@wibelaw.com

 

Website: www.wibelaw.com

Topics: coverage, business insurance

Protecting your business & personal assets - at the same time..

Posted by Uni Aguilar on Tue, Jun 25, 2013 @ 14:06 PM

Today we feature an article from a personal friend of mine, Jim Betinol, who is also a business associate of mine as well. He is a partner at the law firm Withrow & Betinol Law. I have asked him to write an article educating people on the importance of business insurance AND doing business under a corporation or LLC. Notice how I emphasize the word "AND" - because it is not simply enough to have one without the other. Jim can be reached @ 424-229-2560, betinol@wibelaw.com & visited @ www.wibelaw.com.

Why you should have both a limited liability entity (LLC, Corp) and business insurance.

Many business owners mistakenly believe that there is no reason to have both business insurance and a limited liability entity like an LLC or a Corporation -- that business insurance will provide enough protection so an LLC or a Corporation is unnecessary.  This misconception puts many business owners, their homes, savings, and financial security at risk. 

For example, if a customer  is injured at your place of business or due to your services, including unintended injuries (i.e. slipping on a wet floor, a driver accident, construction materials falling on customer, or a mistake made by one of your employees causing property damage, etc.) there is a strong chance that a lawsuit will be filed.  Most business owners have the foresight that these types of situations may occur, which makes obtaining strong business insurance with policies that provide coverage for the types of risks that are likely to happened a must.

However, as medical costs increase, business owners have to pay for higher and higher damages, which may be beyond what is covered by insurance.  When your insurance coverage runs out, this is where your lifesavings, home, and other personal property could be at risk -- and where having a limited liability entity steps in. 

The benefits of having a limited liability entity, such as an LLC or a Corporation, is that they shield your personal assets and keep them separate from your business assets.  This means, when a business liability arises you do not have to worry about the damages affecting your lifesavings or personal assets.  A limited liability entity generally limits personal liability to cases in which you personally cause the harm, guarantee a loan, intentionally act with recklessness, or fail to maintain the LLC or Corporation. 

A properly planned and operated limited liability business can provide:

  • Asset Protection by limiting liability to the assets of the business:
    • For business owners with multiple businesses, this can mean that losses in one higher risk business will not affect the other businesses;
    • For all owners, it will help protect your lifesavings, home, and other property.
  • Potential Tax Savings by reduction of self-employment taxes.
  • Flexibility when bringing in new investors or when selling your business. 

This article should not be taken as legal counsel and readers should not base any legal decisions solely on the article without consulting an attorney.  Legal decisions must be approached on case-by-case basis as your situation may require specific requirements.  For additional questions, feel free to contact the author at betinol@wibelaw.com.

Topics: underinsured, insurance, liability, business insurance