Category : The Journey
One of the choices I had to make as a data science freelancer was whether or not to register as a single-member LLC or proceed as a sole proprietor. A lot of people told me I should get the LLC for tax reasons, for example, to pay yourself a smaller income and take the remainder of the profits as a corporate distribution with a lower tax rates. However, all my research brought me to the conclusion that the type of LLC I’d be applying for, the single-member LLC, is a “pass-though entity,” and all of the income would pass through to my own personal income anyway.
Now the limited liability feature of the LLC is real, provided I’d be able to maintain a “corporate veil,” which I wasn’t sure I was ready to do at this early stage. In July, I’m thinking about forwarding my personal mail to my business address, for instance. So much for separation.
Since I still wanted the experience of creating a business that was not just my given name, I decided to go the DBA route. The DBA acronym stands for “Doing Business As” and allows a sole proprietor like me to create a legal business sounding name without the fees and hassle of an LLC. The DBA is necessary for opening bank accounts in that name as well (apparently you could get in trouble for using a business name that was not registered).
Applying for the DBA wasn’t hard, but like most things government related, you just have to know what to do. LegalZoom will charge you one hundred and change to take the guess work out of it, but if you just go to your state’s process, the instructions are usually pretty simple. In Wisconsin, you file a “Registration of Firm Name” with the county’s Register of Deeds. The instructions are pretty simple.
A week and a half ago, I sent in my notarized application requesting “Ogorek Data Sciences” as my sole proprietorship’s official along with the $30 dollar fee. The name’s not Don Draper grade, but I struggle with names and I asked myself, “do you want to waste time thinking of an awesome name, or do you want to get started?” And while I’ve always thought my last name came across as weird to people, a friend who makes fun of everything didn’t really laugh at the name, and another one commented that it’s pretty easy to say once you know how to say it. It’s pretty close to the sound of the name of the Oreck XL vacuum cleaner. Done.
About five days later, I got my same application back from the Register of Deeds but with the recording area stamped, showing that my payment was accepted. At first I asked, “is this it?” After some reading I found it can take a little longer than a couple days, and I take the returned application as a confirmation that my money is good at the Register of Deeds and my application has been sent to the next level. Godspeed.
Update: There was no “next level.” That was it. The Register of Deeds just recorded the firm name (I believe without any searching or anything.) This caused me some confusion when trying to use the form to get a business bank account with a DBA.