What is the best legal structure for a hot dog cart business?

I was told to do an LLC. I am planning to use the name DMC Financial, and register a fictitious name. So the Business would be called City Dogs. (DMC FInancial dba City Dogs). I was told to do it this way because an LLC has the least amount of personal liability, and if I called the LLC City Dogs I would be required to put City Dogs LLC on all my advertising. Is this the correct way to go about this. I want to be able to write off business expenses etc. This is my first business and I want to do it correctly by choosing the correct legal structure for my business. If an LLC isn’t the best route what would be?

Asked on July 21, 2010 under Business Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

1) LLCs and corporations both shield you from liability. They both have different options for the tax treatment you get, so consult with a tax advisor about what is most advantageous.

2) Between LLCs and corporations, an LLC is usually simpler unless you expect later selling shares of the business; for  that, a corporation is superior.

3) You don't need to always say or write "LLC." Think about McDonalds: McDonalds is a corporation, but they don't run ads as "McDonalds, Inc."--just as McDonalds. You can absolutely omit the business structure (the "inc." or "LLC") in your non-legal communications, such as advertisements. There is therefore no need to set up under a very different name and then register a fictitious name.


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