LLC vs DBA: Which One Is Right for Your Business?

If you’re starting a business, chances are you’ve already asked yourself this question:

“Do I need an LLC… or can I just get a DBA?”

I hear this all the time from small business owners — and the confusion makes sense. No one teaches this stuff in school, and most people just want to get their business up and running without messing something up.

So let’s talk about this in plain English.

First Things First: What Is a DBA?

A DBA simply means you’re doing business under a name that isn’t your personal name.

That’s it.

It does not create a business. It does not protect you. It’s just a name on paper.

Here’s an easy example:

If your name is John Smith and you want your business to be called Smith Mobile Detailing, you would file a DBA.

With a DBA:

• You and the business are still the same person

• There’s no separation between personal and business

• If something goes wrong in the business, it comes back to you

• In California, you also have to file with the county and publish it in a newspaper

A lot of people think a DBA makes their business “official.”It doesn’t — it just gives your business a name.

So, What Is an LLC?

An LLC is where things start to feel more “real.”

An LLC creates a separate business entity. In simple terms, it puts a legal wall between you and your business.

That’s why so many business owners eventually move to an LLC.

With an LLC:

• The business stands on its own

• Your personal assets have more protection

• Your business looks more professional

• You have more options as you grow

You can even have an LLC and a DBA if you want to operate under a different brand name.

The One Difference That Really Matters

If you remember one thing from this blog, let it be this:

A DBA does not protect you. An LLC does.

If your business gets sued:

• With a DBA → you get sued

• With an LLC → the business gets sued

That’s usually the turning point for most business owners.

What About Taxes?

This part scares people, but it really doesn’t need to.

If you’re a one-person business:

• A DBA and a single-member LLC are often taxed the same way at first

• Income usually goes on your personal tax return

The big difference isn’t taxes on day one — it’s flexibility later.

An LLC gives you options as your income grows. A DBA doesn’t.

So… Which One Should You Choose?

Here’s how I usually explain it to clients.

A DBA might be okay if:

• You’re just testing an idea

• You’re not making much money yet

• There’s very little risk involved

• You want the cheapest way to start

  
  

An LLC usually makes sense if:

• You’re making consistent income

• You want protection

• You’re serious about growing

• You want to do things the right way from the start

There’s no shame in starting small — but there is risk in staying unprotected for too long.

A Common Mistake I See

A lot of people say:

“I’ll just start with a DBA and switch later.”

Sometimes that works. But a lot of the time, people:

• Forget to switch

• Mix personal and business money

• Miss filings

• End up paying more to fix things later

  
  

Starting correctly doesn’t mean starting big. It just means starting intentional.

Final Thoughts

There’s no “one right answer” for everyone.

The right choice depends on:

• What you’re making

• What you’re risking

• Where you want the business to go

If you’re not sure which structure fits your situation, that’s completely normal — and that’s exactly what we help with.

Need Help Deciding?

At Green Lotus Business Solutions, help small business owners:

• Figure out the right structure

• Set up LLCs correctly

• File DBAs the right way

• Stay compliant without the overwhelm

If you’re unsure what your next step should be, we can walk through it together.

You don’t need to know everything — you just need the right guidance.