If you are considering starting your own business and you plan to grow it in the future, you should consider an LLC. An LLC will not only add credibility to your business, but it also protects your personal assets. Here are some things to know about adding an LLC to your business name:
What Is a Limited Liability Corporation?
An LLC, or limited liability corporation, is simply a layer of protection for your business. You can start any LLC by filing the necessary documents with the Secretary of State in your area. You will also have to pay a fee. This is one of the least expensive ways to start your business aside from a sole proprietorship.
An LLC is much like a corporation, in that your personal assets are protected if the business faces a lawsuit. Without this protection, your assets, including your home, vehicles, and other property can be seized if your business loses the lawsuit. The LLC establishes the business as its own legal entity. An individual can sue the business, but only the assets of the business can be in danger rather that what you own personally.
Do You Name Your LLC?
When you start an LLC, you have to give it a name. This name is different than the actual name of your business. You can choose anything you want for your LLC, as most business owners do not use the LLC name in their marketing efforts. Generally, many business owners choose to use their own initials, or the initials of all those who have ownership in the business. Once you decide on a name, you will file a "doing business as" or DBA to the LLC name. For example, if you own a nail salon, your name would be J and H LLC DBA Jennifer's Nail Hut. Your LLC name is set and legal while you still use a more marketable name for your business.
One thing you should know is you do not have to place the LLC name on your marketing materials. You only have to use the LLC name on your official documents, such as your bank statements, business cards, letterhead, and the like.
While you do not have to have the assistance of an attorney to start an LLC, it is important you run your information by your lawyer to be sure you have provided all the necessary documentation for your business and that you have followed the small business laws that apply to you.