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#2237032 - 05/20/20 04:47 PM DBA trading as another business
tbate Offline
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Joined: May 2020
Posts: 1
We have a customer who would like to set up an account as Doe's Carpet Cleaning T/A Clean Worx. Doe's Carpet Cleaning has its own tax id number but he defined it as a sole proprietorship. Clean Worx has been filed as fictitious name. This business structure does not seem correct but the branch is insisting on establishing the account. Could someone please provide some guidance on this?

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#2237033 - 05/20/20 04:53 PM Re: DBA trading as another business tbate
BrianC Online
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BrianC
Joined: Nov 2004
Posts: 6,689
Illinois
Welcome to the BankersOnline forums.

The use of DBA does not always mean sole-proprietorship. For example, when I purchased my compliance firm, we established a new corporation but wanted to continue using the better known trade name from the previous owner, TCA. Our corporate documents reflect our ability to do so so our business account reflects our corporate name DBA TCA.

Has the customer provided documentary verification for you to evaluate the structure of the business and the use of trade names? If you're not sure what the laws of your state allow/require for using trade names, ask legal counsel to review the documentation.
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#2237034 - 05/20/20 04:54 PM Re: DBA trading as another business tbate
rlcarey Online
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rlcarey
Joined: Jul 2001
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Galveston, TX
Just because a sole proprietor has an EIN for payroll tax purposes is meaningless. It is either a sole proprietorship or not, which means it is actually just the person. Having a fictitious name filing is just that - fictitious. One fictitious entity cannot do business as another fictitious entity regardless of the what the county recorder allowed them to file. You need more information.
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#2237049 - 05/20/20 06:23 PM Re: DBA trading as another business tbate
Adam Witmer Offline
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I would start by trying to look up the entity (or DBA) on your state's Secretary of State (or other business registry) website. You will typically be able to view assumed name certificates/doing business as (DBA) documents as well as articles of incorporation/organization - which will help you to understand the type of business you are dealing with. If it is a sole prop, as Randy said, the owner could have a separate tax ID for the business and a DBA, but it is still a sole prop. If it is another type of entity like an LLC, it could also have a DBA and do business in a different name. In fact, some business names/structures can seem quite complex on the surface.

The bottom line is that I would try to uncover the true entity type and then go from there. If you still have questions about the business structure, a CFO/CPA, a seasoned commercial lender or other seasoned banker may be able to assist with understanding it.

And welcome to BOL!
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#2237069 - 05/21/20 11:36 AM Re: DBA trading as another business tbate
edAudit Offline
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edAudit
Joined: Jul 2008
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You are here
What has been posted is true but one individual can have multiple D/B/A's (John Smith d/b/a JS Construction, John Smith d/b/a JS Consulting)and it should be up to you policy(state law may apply) if you choose to allow it on one account.
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