DBA (Doing Business As)

Sole Proprietorship

The simplest business structure in which a single individual owns and operates the business with no legal distinction between the owner and the business entity. While easy and inexpensive to set up, a sole proprietorship offers no personal liability protection, meaning the owner's personal assets are at risk for business debts and lawsuits. All business income is reported on the owner's personal tax return and is subject to self-employment tax.

LLC (Limited Liability Company)

A business structure that combines the liability protection of a corporation with the tax flexibility and operational simplicity of a partnership. LLC owners, called members, are generally not personally responsible for the company's debts and liabilities, meaning their personal assets are protected. LLCs can choose how they want to be taxed, either as a sole proprietorship, partnership, S-corp, or C-corp, making them one of the most versatile business structures available.

EIN (Employer Identification Number)

A unique nine-digit number assigned by the IRS to identify a business for tax purposes, similar to a Social Security number for individuals. An EIN is required for businesses that have employees, operate as corporations or partnerships, file certain tax returns, or open a business bank account. Applying for an EIN is free and can be done online through the IRS website, and it is one of the first steps in formally establishing a business.

Business Plan

A formal written document that outlines a company's goals, strategies, target market, financial projections, and operational plans. A well-crafted business plan serves as a roadmap for the business and is often required when seeking financing from banks, investors, or venture capitalists. It typically includes sections on the executive summary, market analysis, organizational structure, product or service offerings, marketing strategy, and financial forecasts.