DBA and LLC’s
Have you heard of the term DBA or ABN? Are you trying to decide if a DBA or an LLC is a good fit for your business?
A DBA (“Doing Business As”) and an ABN (“Assumed Business Name”) are the same thing in Oregon. When you establish a DBA or ABN, you are not creating a separate entity from yourself. This is just the registration of the commercial name you are using for your business so that the state knows who to associate that activity with. If you are just starting out your business, deciding if you want to be registered as a DBA or ABN is the first step people take before filing for an LLC or legal entity. But why? Because first you need to confirm that the name is available in the state where you will run your business and second, you want to let the state know who you are, what this business is and the name of it.
What is the downside of setting up a DBA you may be asking yourself. Well, a DBA is not a separate legal entity. It is linked to your personal information such as your social security number. This is not great in terms of protection of personal assets. Anyone who has an issue with your business and files a lawsuit against that DBA, will be suing you directly. We don’t want that. We want to protect you and your personal assets. This is why business owners decide to register for a Limited Liability Company, the famous “LLC.”
An LLC is a separate legal entity. It can have one or various business members. It is an entity that you register with the Oregon Secretary of State by filing Articles of Organization. No matter how many members you have, it is always recommended that you have an Operating Agreement that delineates the structure of your business. Forming an LLC gives the members personal asset protection (the DBA does not). This is the main reason to form an LLC.
If you have more questions about DBAs or want to strategize about forming an LLC and registering different DBA’s under the LLC, let’s talk!
Request a free 30 minute consultation and let’s take your business to the next level.
