Every year, many businesses choose to operate as DBA, or “doing business as,” which means that they are using a fictitious or assumed business name. In these situations, the legal, registered name of a DBA business is different from the name that they are operating under. This can be done for a broad range of reasons, and it could be right for your business.
What Does DBA or Doing Business As Mean?
There are many completely innocent or reasonable reasons why a business will choose to operate as DBA, but the regulations were designed to make sure that poorly reviewed businesses or dishonest businesses didn’t have the ability to operate under a different name to avoid being caught. If you choose to file a DBA for your business, it will need to be published in the local newspaper or another publication as specified by your state.
Why Do Businesses Choose to Operate as DBA?
Many businesses that are sole proprietorships or general partnerships choose to operate as DBA. This is very common, as many people do not want to use their own name as the name of their business. For example, if your name was John Smith but you wanted to open a bakery Sweet Treats, John would need to file a DBA if his business was structured as a sole proprietorship or general partnership. There are some exceptions to needing to file a DBA when the name is included in the name of the business, like John Smith’s Sweet Treats.
Corporations and limited liability companies (LLCs) also sometimes choose to operate as DBA. This can occur when the LLC or corporation was filed using one business name and chooses to also operate under another or rebrand. If the same person, John Smith, opened a bakery called Sweet Treats but decided to rename it Delectable Delights, he would need to file DBA paperwork.
What Are the Benefits of Operating as Doing Business As?
- Registering as DBA is the easiest and most affordable way to use a business name if you are a sole proprietor.
- You can operate more than one business easily without needing to create a separate corporation or LLC for all of them.
- It’s easy to stay compliant despite operating under another name if you are a corporation or LLC.
- If you don’t want to use your own name to operate your business, you can keep your full name private by operating as a DBA.
Make Filing Taxes as DBA Easy with Help from MKS&H
MKS&H provides tax and accounting services to businesses of every size and in every industry. We can work with you to make taxes easily and avoid the most common mistakes. Contact us today for a consultation.
About MKS&H: McLean, Koehler, Sparks & Hammond (MKS&H) is a professional service firm with offices in Hunt Valley and Frederick. MKS&H helps owners and organizational leaders become more successful by putting complex financial data into truly meaningful context. But deeper than dollars and data, our focus is on developing an understanding of you, your culture and your business goals. This approach enables our clients to achieve their greatest potential.