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Tuesday, March 12, 2019

Small Business Law Blog: Do I need to add “LLC” or “Corp” to my business name?

 

I get it. Those many hours that you spent dreaming up your business idea, plan, and especially business name never included an “LLC” or “Corp.” or “Inc.” Most businesses I speak to never contemplate including these designations. The labels are often viewed as lacking creativity and cramping a business owner’s style.

You want to be known as “Frank’s Fritters,” not “Frank’s Fritters Inc.” There is a solution to this common problem, which I shared in a separate blog post about trade names. If you do not want to go through the additional expense and administrative work of registering a trade name, you may want to read on.

The short answer is, yes, you do need to add “LLC” or its equivalent such as “L.L.C.” or “Limited Liability Company” at the end of your business name. If you are a corporation, you can choose from “Corporation,” “Corp.,” or “Inc.” Unless you amend your organizational documents, however, you cannot switch back and forth from “LLC” to “L.L.C.” or other variations of this. You must stick with the name that is on the business’ Certificate of Organization or Articles of Incorporation.

The reason why you should use your full business name in any marketing materials, contracts, website(s), and so on is to maintain the limited liability shield afforded to you by registering your business with the state. We discussed limited liability protection here.

For instance, if I engaged in business as “Kimberly Shin” instead of “Kimberly Shin Law Firm PLLC,” a court could find that I am personally liable for a business transaction when it was never my intent to hold myself out as an individual. If I properly engage in business transactions as Kimberly Shin Law Firm PLLC, any person or entity bringing a claim against me would only be able to attach my business assets. So long as I did not do anything that was grossly negligent or so egregious that it would be unfair to take away only my business assets (ex. Bernie Madoff), my personal bank accounts and property would be protected.

 

Also keep in mind that when signing contracts, an authorized representative will want to sign the document as an agent of the company. The signature formats should look like this:

For a Limited Liability Company:

[LLC Name], a [State] limited liability company
[LLC Address]*

[Date]
[Signature]
[Name of Signer]
[Title of Signer]

For a Corporation:

[Corporation Name], a [State] corporation
[Corporation Address]*

[Date]
[Signature]
[Name of Signer]
[Title of Signer]

*The information in this paragraph can sometimes be found in the preamble of a contract or on the first page of the contract.

Once you form the habit of using your full business entity name, the “LLC” or “Corp” may begin to endear itself to you. But if you truly can’t stand it, register a trade name (also called a d/b/a or fictitious name). 

If you have any questions about forming a new business or registering a trade name, give us a call at (202) 630-6546 or send an email to info@legallyprotect.com

DISCLAIMER: This article is provided for educational and informational purposes only. An attorney-client relationship is not formed by visiting this website, commenting on this post, or submitting information through the Contact Us form. The information provided here is not intended to, and should not replace, advice from a licensed attorney in your state. Kimberly Shin Law Firm PLLC disclaims all liability with regard to any and all actions taken or not taken as a result of information contained here.

 


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