What is a D/B/A?

What is a D/B/A?

by Cynthia Pasciuto

Welcome to TrueNorth Business Consulting’s presentation of a Business Makeover. Each month will feature an idea that can help your business. True North focuses on helping health and wellness practitioners to maintain and grow their business using the areas of business law, marketing, insurance and project management.

The focus this month is on business entities, specifically DOING BUSINESS AS or d/b/a. I am not a fan of acronyms, but this is an important one to know.

Doing Business As What?

First, you need to understand that business and personal expenses must be kept separate. To do that, if you have your own business, then you need to have a business entity. A business entity creates an existence for your business.

D/B/A’s are the easiest business entity because there is no formality to it. All you need to do is go to the bank and open a checking account. The name of the business is YOUR NAME D/B/A BUSINESS NAME. You can name your business anything-just do not use the other acronyms like Corp, LLP, or INC.

What about the IRS?

Funny how acronyms keep coming up! The Internal Revenue Service will learn about the business on your personal income taxes, because you are reporting everything on your social security number. However, if you do not want to use your social security number you can get an EIN number, Employer Identification Number at www.irs.gov. No matter, though, you will still pay your taxes on your 1040.

This sounds too easy.

It is. The drawback is that a d/b/a provides the least protection. Your personal assets are available in case you are sued on a business activity. Insurance can help you, but also choosing another type of business entity like a corporation or limited liability company provides another level between you and your business. There would also be less inclination to mingle your personal and business funds.

Acronyms can be confusing, but understanding them can help your business. LOL.

If you are a health and wellness practitioner- a life coach, a massage therapist, acupuncturists or provide another type of health and wellness service, then TrueNorth Business Consulting has the TrueNorth Guidebook for Health & Wellness Practitioners with information on planning your marketing strategy, review of insurance protection, the legal elements of business and project management simplified. Go to truenorthbusinessconsulting.com to buy your copy today.