Specialist · Chicago, IL · Member since 2015 · 870 posts · 345 votes
Hello,
I would like to create a separate business identity without having to form an LLC or corporation.
Now, I only want to mask my identity from my tenants and contractors. I carry a 1 million umbrella policy and simply want to have checks issued from/to my "Doing Business As".
I own the units under my name only and may transfer them to a trust later on. There is no mortgage.
I am not interested in LLCs; they don't provide the protection many people think they give. They are useless to my particular case.
Have you done a DBA in Illinois?
Have you applied for a tax id or number doing this? Have you tried to get the home depot tax exemption by claiming you will resell the goods/property in case of a flip?
Can you get more than one separate bank account under your DBA?
Can the lease be on the DBA only or does it have to have my name?
Can the lease have a PO address or does it have to have my home address?
First, to get the DBA, there's a public disclosure printed for several weeks in the local paper, so anonymity is doubtful .
There is no TIN associated with a DBA, so your personal SSN is still on the hook.
A DBA is not a legal entity, it's the filing of a business name, aka alias to you. This will prohibit putting a DBA on title.
The lease may use the DBA name, and you can get all the bank accounts you have the patience to fill out forms. When signing such a lease, your signature would need a legend like
@Frank S. The DBA process is different in every state, but it is very public in each of them. If you really want to hide who owns the property you would have to do more complex methods. Generally, trusts work best.
In the last year, lots of celebrities were outed for having offshore trusts own their properties.
The reason they used that method is because it is pretty much top of the line.
How will a DBA give you more protection than an LLC ? Highly doubt that.
You have very little protection right now if your properties are all in your own name.
A properly set up and well run LLC and good insurance should give you both the protection and anonymity you need. Just my opinion.
Own nothing. Control everything.
Thanks for the message.
Regarding, "How will a DBA give you more protection than an LLC ? Highly doubt that." Well, that's not what I tried to convey.
"You have very little protection right now if your properties are all in your own name." I think I am well protected through my umbrella policy and home insurance.
LLCs won't protect you from tort, it protects you from your employees. I don't have employees. I don't need an LLC.
The anonymity I need is partial, as I said, I only need it to issue checks, maybe the lease, etc.
"Own nothing, control everything" is not what an LLC gives you. You own the LLC, bud. You are not untouchable. This post is not to discuss LLCs, do you own research and set it up as you please.
First, to get the DBA, there's a public disclosure printed for several weeks in the local paper, so anonymity is doubtful .
There is no TIN associated with a DBA, so your personal SSN is still on the hook.
A DBA is not a legal entity, it's the filing of a business name, aka alias to you. This will prohibit putting a DBA on title.
The lease may use the DBA name, and you can get all the bank accounts you have the patience to fill out forms. When signing such a lease, your signature would need a legend like
Your Signature / {agent or owner} of DBA name
Thanks for the info.
Paper disclosure is good enough.
DBA can get a EIN, apparently. I wonder if this is the case in Illinois.
DBA and title. I never said I needed that. Once I set up a trust, the DBA may not be needed.
I appreciate the info on the DBA leases. That sounds good to me. I don't want my tenants to know I am the owner. This may confuse them a bit. It's not for high end rentals. They won't have a clue. I'll tell them verbally the DBA is the owner. This is true.
@Frank S. The DBA process is different in every state, but it is very public in each of them. If you really want to hide who owns the property you would have to do more complex methods. Generally, trusts work best.
In the last year, lots of celebrities were outed for having offshore trusts own their properties.
The reason they used that method is because it is pretty much top of the line.
I need a fast and cheap way to start issuing checks to my contractors. This will make it look more official and I can blame the DBA for enforcing contracts.
" It's on the contract, I am only managing the project. Trust me, I am on your side". You get the idea.
btw: If you have a legal entity, IT can file a DBA and use the entity TIN; it's just a formalized ALIAS process.
Jeff, once again, thanks for the feedback.
This confuses me a little bit, see below. What do you think, Jeff? It seems I can be my own legal entity, operate under a DBA and still apply for a EIN under the DBA.
Am I a sole proprietor because I own the units under my name?
Sole proprietors often operate under a DBA to establish separate identities for their businesses to potential customer or clients that are distinct from their personal identities. However, the IRS does not require a sole proprietor to obtain an EIN, even if she uses a DBA for her business. Instead, she would use her personal Social Security number. Nonetheless, a sole proprietor using a DBA may wish to obtain a separate EIN for the business as well, to further distinguish her business transactions from her private affairs. In addition, many banks require that a sole proprietor must present present a DBA certificate, an EIN, or both, as a condition of opening a business bank account, which is an essential element of establishing separate business credit.
You got it. Stark naked DBA uses your personal SSN. If you so desire, you can apply for the EIN in the name of the DBA - - but that adds more complexity in taxes w/o any increase in anonymity.
You got it. Stark naked DBA uses your personal SSN. If you so desire, you can apply for the EIN in the name of the DBA - - but that adds more complexity in taxes w/o any increase in anonymity.
Man, REI business if fun. Can you imagine how boring it would be if it was easy?
Taxes: Oh, snap! You are totally correct, good point. I should keep it with my SSN.
In Chicago, we are required to post the management company and phone and address on our rentals. I don't want to use my name there, either. I guess, I should hire a lawyer to pick his brain for an hour or two.
Have you applied for a tax id or number doing this? Have you tried to get the home depot tax exemption by claiming you will resell the goods/property in case of a flip?
Is this a thing that people are doing? How would you be tax exempt? You're not collecting sales tax on the sale of the house, nor are you reselling specific goods.
Have you applied for a tax id or number doing this? Have you tried to get the home depot tax exemption by claiming you will resell the goods/property in case of a flip?
Is this a thing that people are doing? How would you be tax exempt? You're not collecting sales tax on the sale of the house, nor are you reselling specific goods.
No, I haven't applied for a tax id. I use my SSN.
No, I haven't claimed a tax exemption on a flip - yet. I don't understand how this works.
A GC I used, used his tax number and did not pay sales tax. I think the trick is that he is reselling the goods as part of his work. It may be a tax deffered program. I have no clue how this works. I need to research more.
The paper you publish it in is one no one has ever heard of. I just did a search now and couldn't find the publication from a few years ago.
We could get an account and checks printed with the dba name, the landlord on leases was the dba, rent checks paid to dba. Had a UPS store box that knew our name and dba name. Address is always the UPS store box or PO box address. never use your home address. I think the only time you need an actual non PO box non UPS store address is for a registered agent, and in our state, a real estate office needs to be an actual address where the files are located.
@Frank S. When I did the dba form there were some papers the county recommended, or maybe I just googled "publish dba" they were papers you've never heard of; I don't remember which one my listing was in. To long ago to remember.
You are wasting time and effort hiding from people with a DBA or LLC unless there is something in your past that will make it difficult for you to do business.
Not sure what you are hiding from but it won't work. Honesty is always the best policy especially with contractors, defiantly when dealing with tenants.
If you fear identifying yourself you may not be cut out for this business. I know this is not the topic of your thread but you would be farther ahead simply not trying to hide your identity, it serves no purpose.
You are wasting time and effort hiding from people with a DBA or LLC unless there is something in your past that will make it difficult for you to do business.
Not sure what you are hiding from but it won't work. Honesty is always the best policy especially with contractors, defiantly when dealing with tenants.
If you fear identifying yourself you may not be cut out for this business. I know this is not the topic of your thread but you would be farther ahead simply not trying to hide your identity, it serves no purpose.
Your comment is beyond ridiculous. Thanks for the laughs.
@Frank S. When I did the dba form there were some papers the county recommended, or maybe I just googled "publish dba" they were papers you've never heard of; I don't remember which one my listing was in. To long ago to remember.
Have you applied for a tax id or number doing this? Have you tried to get the home depot tax exemption by claiming you will resell the goods/property in case of a flip?
Is this a thing that people are doing? How would you be tax exempt? You're not collecting sales tax on the sale of the house, nor are you reselling specific goods.
Here is an update:
In Illinois, one can defer paying taxes on purchases made for resale. Many contractors do this.
I am in Illinois as well. The LLC's are very expensive in Illinois and I understand the DBA concept. I would urge you to go on to YouTube and search Mark Kohler LLC and DBA. He does a great job on explaining the difference. His firm represents a number of people in Illinois. Its great free information. He will do a free 15 minute consultation over the phone.