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I had a DBA in San Francisco County, where I used to live. I recently moved from SF to upstate New York...

My question is this: Is it really necessary to have a registered sole proprietorship (since the sole proprietorship and I share a tax ID # anyway) in my new county? That is, so long as I continue to report my income, can I still deduct my business expenses without updating my DBA? Or is it a good idea to register my DBA in my new county?

Hi Gabe,

In my opinion, the only purpose and value for a sole proprietor to register a "fictitous name" (I assume that's what you mean by DBA) is for the sake of branding. Building a brand may, or may not, help you make more money. If you are a roofing contractor you could do just fine as "Gabe's Roofing" but if you wanted to boost sales, expand, or charge higher fees, you might get value from registering "LeakBusters" or some such thing. (Sorry, that's the best I could come up with in a hurry! <g>)

You get the point -- the brand is something that conveys a meaning above and beyond your own personal reputation. It is also something that can be sold if it is trademarked and so on. FWIW, most roofers I ever saw just used the family name <g>. Anyway it is my understanding that no DBA registration is required when you work under your own name, and especially if you use your own SS# as the business Tax ID#.

(I haven't checked those laws in a long time, so you might want to confirm them with your local authorities. They'll know better than we.)

The other aspect of a fictitious name is just what you identified -- geographic limits. I know somebody who used one for years but never registered it, then finally did on a local basis. It did not have any particular meaning to anybody but him, I don't think -- and there were a zillion other companies using that name all over the place, including the Internet. He's happy with it, but it may well function more like a sort of "vanity license plate" concept than a real business need.

So, if the DBA has any real meaning or value, I'd nail it down in every region where I expected to do business, and definitely include California and NY (or, LA and NYC, or whatever). I'd want to control the use of that name in all the places that mattered, because brand identity can be dissipated so easily. This also includes getting a web domain name that echoes the DBA, and that's getting harder and harder to do. Trademarking is a lot easier if you have established this identity as being associated more with you than with some other person or entity.

Your county government may have its own regulations, but I think most municipalities simply follow the lead of the IRS, so whatever specs or restrictions the IRS places on the name you use, you can probably do the same thing on a local basis.

There may well be more to it than this, but anyway I think this is the answer you need as it relates to Schedule C. The only other thing I'd look at is whether the change from one year to the next gets undue attention from the IRS and makes them think your filing status has changed in some way. Some of those examiners are really easily confused. <g>

Hope this helps.
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