What is a DBA?
- A DBA is an alias. It gives you the ability to do business under a new name.
Is a DBA a different entity?
- A DBA is a way for you to give your business a different name, but it isn’t an actual legal entity like an LLC. An LLC limits personal liability for business debts.
Key Considerations for Choosing an Entity
- There is no “one size fits all” approach when choosing an entity. The choice impacts finances, liability, and risk.
- Most entrepreneurs start as an LLC for liability protection and pass-through taxation.
Benefits of Getting a DBA
- Getting a DBA can protect your brand and provide recognition as a legal entity.
- Registering a DBA is a simple and affordable way for sole proprietors to set up distinct legal entities.
Reporting a DBA on a 1099
- To report a DBA on a 1099, provide the necessary information associated with it and the purpose of the payment.
Clarifying DBA and LLC
- A DBA allows a business to operate under a different name and is not a separate legal entity. In contrast, an LLC provides personal liability protection for business debts.