How to Operate an LLC Under a Personal Name
It is fascinating for most of the LLC owners to name their LLC after their name so that they can grow their personal brand. But this personalization of the name of LLC to the name of an owner can limit the overall growth of business and can confuse the customers also.
When Nina Berenato added her personal name to her LLC then the sales on her website and brick-and-mortar store increased.
She says that when she added her name to the LLC people were able to identify the product through her as well which felt a kind of emotional attachment between my brand and my customers. This all happened when she changed the name of LLC from Psyche Jewelry to Nina Berenato Jewelry operating under the Nina Berenato Worldwide LLC.
That was the right move at her end. But can this also work for your company as well? Here is what you need to understand that how to operate your LLC with your personal name,
Situations When an LLC With a Personal Name Makes Sense
People naming their LLC with their personal name is something that commonly happens across the globe especially when those individuals are recognized as popular personalities which can positively impact on the product and image of the business. A living example of this is Amanda Terman LLC, which attracts potential clients because of her voice personality and perspective.
She says creating my LLC with my name was important to keep a personal self deeply connected to the professional brand which emerged as a unique identity with the creative business line where I work. And this has never affected my personal assets by keeping legal protections that my LLC offers.
Keri Calabrese who is a photographer that there are several people who name their businesses after themselves because they are selling some kind of high value skill but she was reluctant to follow the first steps of those because she thought she wanted to create something bigger than herself.
Initially, she used her personal name for her LLC as Callie James Photography, but she realized that people were calling her by the same name because they thought it was her real name which was a kind of confusing for people.
Here the important thing to note is that this makes sense when the owner has a personal reputation and popularity in a particular area in digitally which can positively impact the LLC, which is named after him or her. For example, if there is an athlete who is famous for his amazing performance in the field and he or she starts an LLC with her personal name attached to it then chances are he/she will see amazing growth as compared to someone who is hardly known in a particular area/field.
What to Watch Out For
You may also encounter drawbacks if you attach your personal name in your LLC and you must be careful while taking this crucial step.
Adding your personal name to your LLC can backfire if your name is hard to spell or pronounce. Or it is something commonly used in the area which may confuse people to actually distinguish between your LLC brand and other common individuals around the area. Even if you decide to add your name make sure that it projects something like this Empire Electronics Design by Jane Doe LLC. This actually explains that what the company does and who is the owner but you cannot simply write “Jane Doe LLC”.
Bradley Stevens CEO of LLC Formation, says that if your name is too close to your brand then chances are people will consider it as a one man show instead of a good brand.
Business consultant Jessica Dennehy of Pivot and Slay advises entrepreneurs and startups to avoid attaching personal name to the LLC. She says that most people want to create an entity that progresses to the point where the founder can turn it over the new leadership and this progression can be difficult to accomplish if the brand identity of the company is the name of the owner.
Due to these reasons attorney Ugo Lord frequently suggests to his clients that they establish the LLC in their personal name for the goal of limiting their legal liability, but run the business under a DBA ‘doing business as‘ instead – under an alternative name. Whenever a customer tells me they want to use their name but are scared to run public ads in their own name, I normally offer this strategy, He claims.
Keep your personal accounts and activity distinct from the business entity under your name, especially when signing documents on the corporation’s behalf.
The ideal approach is to always sign as Michael Brown on behalf of Michael Brown LLC to prevent any problems, says Weinstein + Klein business lawyer Damien H. Weinstein. This dispels any claims that Michael Brown personally took on the entity’s debts or liabilities.