About Danica Jovic

Danica’s greatest passion is writing. From small businesses, tech, and digital marketing, to academic folklore analysis, movie reviews, and anthropology — she’s done it all. A literature major with a passion for business, software, and fun new gadgets, she has turned her writing craft into a profitable blogging business. When she’s not writing for SmallBizGenius, Danica enjoys hiking, trying to perfect her burger-making skills, and dreaming about vacations in Greece.

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Since the advent of electronic checking, paper checks have become less common. While banks and financial institutions still process them, knowledge of how they work is ebbing among the population. We simply don’t use checks to the same degree as we did. Indeed, 93% of Americans today receive direct deposits instead of physical paychecks. However, there are still situations in which you need to know how to void a check, particularly when you want to issue checks to employees paid by direct debit or set up direct deposit accounts with vendors.    Instructions to Void a Check Voiding a check is incredibly simple. It involves just writing the word “VOID” on the check itself.  There are two accepted ways of doing this:  Writing “VOID” in large writing on the front of the check, making sure the letters cover all lines but don't hide the check and account numbers Writing “VOID” separately on the signature line, amount box, payee line, amount line, and date line Following are more detailed steps to create a voided check: Step 1: Start with a Blank Check Banks don’t require you to include any additional information on the lines when voiding checks. All you need to do is take out a blank check from your checkbook to proceed.  Step 2: Void a Check with Blue or Black Ink The next step is to take a black or blue ink pen and write “VOID” in capital letters across the front of the check. By writing “void” on a check, you prevent anyone else from filling out the remainder of it and cashing it to a different account.  Make sure that as you write the word “VOID,” you do not cover the account and routing numbers. If you obscure them, bank clerks won't be able to identify your checking account.  Step 3: Make a Copy The last step is to copy the voided check and send it to the relevant party, such as your employer. You should hold onto the original copy to make sure that the check number is not used at a later date.   What Situations Require You To Void a Check? There are many situations in which you may want to cancel a check. Voiding a blank check lets you share your account information while preventing anyone from using the check. Mistakes It is common to make mistakes when writing checks, mainly if you do it by hand. However, you should never throw the half-completed check in the bin. If you do, there is a risk that somebody might find it and cash it with a different bank account from the one intended. Writing “VOID” on it prevents anyone from using it in any way.  Automatic Payments You may also need to void a bill payment check if you set up automatic or recurring payments that are deducted from your checking account. Direct Deposits Lastly, learning how to void a check for direct deposit can also be helpful when you want to get the money directly into your account. Sending a void check to employers lets them view your account details to set up payment.    What Happens if You Don’t Have a Checkbook? If your account does not have a checkbook, how can you provide a voided check? First, you can ask businesses and employers who need your account and routing numbers to connect to your account directly. Many establishments can do this, so you might not need to provide a voided check that could get lost in the mail.  However, if connecting to your account is not an option, you may want to try accessing a preview of your checks online. You may then be able to print these, write “VOID” on them, and send them to the relevant parties. Always check if receivers accept the previews, as it's not always the case. The other option is to get what's sometimes called a “counter check” at your local bank branch. Instead of handing you a large checkbook, they provide you with only one check that you can then void. You may have to pay a fee for this service.  Of course, if you are trying to prove your account details, you don’t necessarily need to use a check. Any formal documentation from the bank should suffice. Banks, for instance, may be able to draft an official letter with your account and routing numbers that you can use instead of the regular voided check.    How to Send a Void Check by Email If you’re trying to void a check via email, don’t send it as a pasted image or an attachment. Instead, do one of the following:  Put it in a password-protected file Create a link to a file in a protected folder Put it in an encrypted file Better yet, send it as a physical copy. That way, there is no risk of a hack.    How to Void a Check Lost in the Mail Voiding and reissuing a check is sometimes necessary, for example, when the check gets lost in the mail. You will need to contact your bank or credit union to do this.  Start by checking your bank statements to see if the check has cleared. If it hasn't, you can issue a stop payment order. This order instructs the bank not to clear the check.  Next, collect the information you will need to speak to your bank. You will require an account number, the exact amount of the check, and the check number. You may also require details of the payee – the person receiving the check – and the name of the person who signed it. You should have this information on your checkbook stubs.  Next, contact your bank directly, either via telephone, online or in writing to tell them to stop processing the check. Most banks and credit unions provide contact information on their credit and debit cards.  Once you contact the bank, they will put the stop payment order into effect. Orders typically last six months to prevent anyone from cashing the check out without your consent. After that period, most banks will not cash the check anyway because it is more than six months old.  Fees Some banks and credit unions allow you to cancel checks for free, but they are few and far between. Most charge fees, sometimes up to $30, to cancel a check that would otherwise be debited from your account. Furthermore, there may be differences in tariffs when you pay over the phone and online.   Voiding a Check in Quickbooks If you use Quickbooks accounting software and you need to void a check, you can. Here’s what to do:  Click Banking and then Use Register, then click on the account that wrote the check. Click on the check entry number that you want to void. Click Edit and then Void Check. When prompted to void the check in the current period, click Yes. Click Record to make a permanent record of the void. Voiding a payroll check in Quickbooks is also straightforward: Click the Payroll Center or Employees, depending on the system you use. Click the arrow to Related Payroll Activities and select Void Paychecks. (If you are not using a payroll service, simply click Void Paychecks). In Show Paychecks From and Through, specify when you wrote the check. Select the paycheck you want to void from the list and click “Void.” Once you click Void, make sure that the amount on the check goes to zero.  Click Done and exit the screen. Wrap Up In this post, we explored how to cancel a check. The process is surprisingly easy, but understanding why you need to do it might be more complicated. You may need to void checks when proving your bank details to utility companies or employers, or when you’ve made a mistake writing them. It is also important to know where to write “VOID” on a check. You can write it in a small script in the amount line, payee line, amount box, signature line, and date line, or in large writing across the front of the check covering all fields except the check and account numbers.

By Danica Jovic April 20,2022

Any business planning to stay on top of its bookkeeping, accounting, and financial modeling, needs to account for its assets vs. its liabilities. Regardless of the type of business account you’re dealing with, these will be presented on your balance sheet. In this article, we take a deep dive to understand these core business components: What they mean, how they can impact a business, and what to consider before acquiring either. Assets From an accounting perspective, assets are defined as resources or goods a business, individual, or government owns that help generate revenue, add long-term benefits and value to the business, reduce expenditure, or increase its value. Anything with economic value for a company or the ability to increase an individual’s net worth, is an asset. Defining assets in accounting terms takes the element of control into consideration: Assets are also items or resources owners can sell or use to obtain something else of value. The three requirements something must satisfy to be classified as an asset are: It must be something a business or individual has control over. Said control must be given to that business or individual via past actions (e.g., building or constructing an item, an outright purchase, inheritance, etc.) It must have or be able to generate some economic benefit in the future. Some examples of assets are cash and cash equivalents, unpaid invoices, investments, equipment, patents and trademarks, property, etc. Liabilities From an accounting perspective, liabilities are obligations or payments a business or individual has yet to make good on. These may be monetary, or in the form of services yet to be rendered. A liability must have the following three elements: It must be a result of past events and transactions. It must present new obligations for the business or individual (e.g., wages owed to employees). There must be an outflow of valuable resources to settle the debt. All businesses have liabilities, except in peculiar cases where the company only receives and makes cash payments. Liabilities can include loans, salaries, accounts payable, sales taxes, unearned revenue, credit card bills, customer credit, etc. Asset Classification Assets are grouped based on their convertibility, physical existence, usage, and ownership. These classes are current and fixed/non-current assets, tangible and intangible assets, operating and non-operating assets, personal and business assets, fictitious assets, and investment assets. Current and Fixed/Non-Current Assets Current assets consist of funds and items or resources that can be quickly converted to cash (i.e., liquidity), typically within one year. They are also referred to as liquid or short-term assets, and include, but are not limited to, cash, cash equivalents, office supplies, short-term deposits, inventory, marketable securities, and unpaid invoices or accounts-receivable assets. Fixed/non-current assets provide long-term value but cannot be converted to cash as quickly and efficiently as current assets. They are also referred to as long-term assets and include, but are not limited to, patents, trademarks, land property, and heavy machinery and equipment. The value of fixed assets tends to depreciate over time and with use (e.g., cars). Tangible and Intangible Assets Tangible assets are physical in the sense that they can be seen, touched, or felt. These assets are also easy to convert to cash where it becomes necessary for a business or individual to do so. Some examples are vehicles, inventory, and office equipment. Not to be confused with fictitious assets, intangible assets are those assets that exist without the physical element, i.e., they cannot be seen or felt, but have economic value. They are also harder to convert to cash and include logos, copyright, patents, trademarks, etc. Operating and Non-Operating Assets Operating assets are those through which revenue is generated for daily business operations, for example, paying liabilities like wages owed. Such assets include cash, accounts receivable, inventory, and fixed assets. Non-operating assets generate value, but not for the daily operations of a business. In this category, you’ll find things like investment securities, unused equipment, land, or property, etc.  Personal and Business Assets As the name suggests, personal assets are those belonging to private individuals. They are controlled by their owner and do not fall under the company’s purview. On the other hand, business assets are owned by a company and cannot be used for private purposes. Decisions concerning the management of business assets need to be made by the company’s leadership, as these are meant to maintain the economic growth of the business. Fictitious Assets Fictitious assets, like intangible assets, lack a physical element; as their name suggests, they’re not real assets - instead, they’re cash expenditures than haven’t yet been accounted for, but are expected to generate revenue in the future. By definition, fictitious assets have an expiration date: Examples include discounts on shares, promotional and marketing costs, and preliminary costs. Investment Assets These are assets that have the primary purpose of generating a profit and boosting the investment portfolio of an individual or business. Examples of assets in this class are stocks, bonds, and currencies. Investment assets can either be growth assets or defensive assets. Growth assets are those with high potential to bring bigger short-term gains (e.g., property and volatile stocks), while defensive assets provide smaller, but stable, revenue (e.g., debt securities and savings accounts). The Importance of Asset Classification Classifying assets based on their convertibility, physical existence, usage, and ownership is not merely a matter of convenience or unnecessary accounting terms. Understanding the nature of an asset helps business owners and private individuals determine what assets to invest in. For example, knowing the difference between operating and non-operating assets paints a clearer picture of how they contribute to a business’s revenue. The solvency of current and fixed assets must be considered before acquisition in case of inevitable situations that rely on liquidity. When assets are acquired without proper consideration, they can become current or long-term liabilities without warning. Liability Classification Liabilities can be current or short-term, non-current or long-term, and contingent liabilities. Current or Short-Term Liabilities These are debts or obligations due to be paid within a year. Current liabilities come in the form of accounts, bills, and interest payable, bank account overdrafts, short-term loans, accrued expenses, customer credit, customer prepayments, wages and taxes owed, etc. and can be monitored using accounting software. Non-Current or Long-Term Liabilities Long-term liabilities are due to be paid in over a year. Just like current liabilities, they should be closely monitored because they factor into long-term solvency.  These liabilities include, but are not limited to, long-term loans, employee benefits, bonds payable, deferred tax liabilities, capital leases, mortgage payable, leases, long-term accounts payable, deferred revenue income, etc. Contingent Liabilities Contingent liabilities depend on the outcome of an ongoing or anticipated event. These liabilities are generally not recorded until the expected event's probability surpasses 50%. When registered, the liability amount is estimated, not fixed. The primary examples here are lawsuit costs and product warranties. The Importance of Liability Classification Knowing which category liabilities belong to helps entities keep track of their implications: The repayment terms on current and non-current liabilities are essential for creating payment plans in line with their expiry dates. Knowing which category they belong to deters accruing too many liabilities in any one of them. For example, having multiple concurrent long-term loans could easily become overwhelming. Relationship and Differences Between Assets and Liabilities Assets and liabilities coexist and complement each other. Here’s how: Liabilities are often used for purchasing necessary assets (e.g., taking out a loan to buy equipment). Assets generate revenue that will later be used to pay off liabilities, maintaining healthy cash flow. A healthy assets vs. liabilities ratio ensures that liabilities do not outweigh the assets used to pay for them. The more assets you have compared to liabilities, the faster your profit will grow.  Assets are more prone to depreciation than liabilities. Liabilities are generally described as non-depreciable. On the balance sheet, assets appear on the right, while liabilities appear on the left. Asset Benefits As much as they have been established in the previous paragraphs, the benefits of different assets cannot be overemphasized: Owning tangible assets instead of renting them helps save costs in the long run; it also gives you the option to rent them out to others. However, some tangible assets (e.g., machinery) tend to depreciate over time. Intellectual property assets protect their owner from third-party infringement and generate revenue from licensing and transferring those rights. A healthy assets vs. liabilities ratio ensures adequate cash flow. Company culture is an intangible asset that is often overlooked, but it converts to employee retention, and, in turn, revenue generation by minimizing hiring costs and maximizing employee experience. Real estate is the most viable category of assets an individual or business can own, as it appreciates over time and can be liquidated relatively quickly. Assets often outlive their owners and can be part of their estate. Assets contribute positively to the valuation of a business. Liability Benefits In a discourse addressing assets and liabilities, it might seem a bit strange to attribute benefits to liabilities, but the word does not connote only negativity. Some of the merits of liabilities are: Loans increase short-term liquidity, adding value to a business. Liabilities keep businesses and individuals on their toes and aid financial growth, due to the fear of running into solvency issues. Assets vs. Liabilities vs. Equity Equity represents the amount a business is worth once it’s liquidated and all its debts are paid. The equity needs to be positive - if the figure is negative, the liabilities have outweighed the assets, and the business is at risk. The basic accounting equation for the calculation of the equity or net worth of a business is: Total assets - Total liabilities = Equity When a business can pay out its liabilities, the remainder of its assets is referred to as stockholders' equity. The state of equity provides some insight into how the finances of a business have progressed or failed, and the anticipated growth rate and pattern. An increase in equity can result from increased revenue, stock sales, and the addition of capital by shareholders, while a decrease can be due to depreciation in the value of assets and an increase in liabilities. Assets vs. Liabilities: General Terms This section addresses terms related to both assets and liabilities Valuation Valuation is the process of determining what a business would be worth if sold. Valuation may be done on the business as a whole or assets alone. The three major approaches to valuation are the cost, market, and discounted cash flow approach. Asset valuation is a process a business undertakes to determine the value of all the assets it owns. The valuation of its assets can be used for restructuring purposes, audits, or loan applications. Assets can be categorized into tangible and intangible assets for convenience. For tangible assets, valuation methods include the cost, standard cost, market value, and base stock method. The term used to describe asset or liability value is “fair market value,” and it can be both current or projected. Accruals Accruals represent the income and expenditures that have not yet been executed. Basically, it’s what the business owes or is owed that has not been inputted in any financial statements. What falls under accruals will largely depend on the accounting period. For example, machinery repairs can be accounted for at the end of the financial year.

By Danica Jovic April 21,2022

Most business activities come with a high degree of risk. To minimize it, companies or organizations may obtain a certificate of insurance (COI) from an insurance company, outlining the coverage they have and expected outcomes. Aside from answering the question: “What is a COI?” this article discusses its importance and the types of COIs you can get. What Is a COI? A COI in business protects your company from specific occurrences defined in the terms of the insurance program. If you’re considering a partnership with another company, the COI also serves to give everyone peace of mind, as it represents reassurance that financial losses would be minimal should the collaboration fall through. COI documents contain all the essential details of your insurance policy in an easy-to-digest format. This information includes the details of the protected parties, the types of losses covered, the dates during which the policy is effective, and policy limits. Do I Need a COI? There are several reasons organizations get and request COIs. These include:  Proving Their Insurance Status A business certificate of insurance proves to clients that the company in question is insured. A reputable company should always be insured, and having your COI ready is one way to maintain that reputation. Outsourcing Protection Hiring additional workers outside of your organization comes with various risks. COI compliance is vital here, as it prevents you from rendering your insurance coverage void, even if your contractor is at fault. Make sure to only create contracts that adhere to your COI and the contractor’s. Reduces Liability Examine the COIs from potential partners carefully: In some cases, you can transfer your losses to the other party if things go wrong, and if your COI is not watertight, it might be able to do the same to you. Information Access Lastly, a COI policyholder can obtain the information to prove its insurance status rapidly, saving itself lots of time and administrative snags. Who Needs a COI? COIs are generally required whenever one company cooperates with another. For instance, if you run a toy store and supply products made by third-party manufacturers, you need guarantees their coverage is good enough to protect you and your customers should something go wrong. The same principle applies to running a bar: For example, if a brewery supplies you with bad ale, you need to make sure your COI or their insurance protects you if the potential injured parties decide to sue you for damages. The number of COIs you need to ask for can be pretty high during the regular operation of your business. A bar, for instance, may require COIs both from product suppliers (such as breweries), as well as ancillary service providers, such as cleaning agencies, marketing firms, and even interior designers. When you request a certificate of insurance for business, you’re not saying that you don’t trust your partners. Instead, you’re doing something that minimizes risk, and you should ask them to do the same. Even if you’ve worked with a company many times before, getting a COI is still a good idea every time you sign a new contract. This way, you prevent anyone from taking unnecessary risks. What Is an Additional Insured? There are three relevant entities in any certificate of insurance for a small business: The policyholder, certificate holder, and additional insured. The policyholder is the entity that originally took out the policy. For instance, it could be a builder, or building company. The certificate holder is the person who requested the COI. This could be a subcontracting firm working with the builder, perhaps a plumber. An additional insured is a business or entity that benefits from one of the signing parties’ insurance, but has not paid for it directly. This category of entities can make claims under the policy, even though it did not purchase it.  To reduce risk exposure, certificate holders will often ask policyholders to provide the details of additional insured parties, or request to be named as additional insured on the policyholders' document. In some cases, COIs offer “blanket insurance.” These terms provide all third-party partners (as defined by the terms of the insurance document) with coverage, negating the need to manually add additional insured entities. How Much Does a Certificate of Insurance Cost? In most cases, the COI cost is zero. Insurers typically offer it as a complimentary service. If insurance brokers attempt to charge your for COI issuance, you may want to go with a different provider. Be mindful that you may need to pay additional fees if you request policy changes to cover your new circumstances. As usual, the greater the coverage you have, the higher your premiums. How To Get A Certificate Of Insurance If you have a small-business insurance policy, how do you get a certificate of insurance? The answer is: Easily. Here are the steps you’ll need to take: Step 1: Contact Your Client If a client requests a COI, first ask them for their limits and minimums for the policy. You want to avoid sending over a COI that does not meet their requirements. If you need to increase your premium, write down your client’s name, address, and tax identification number. Your broker can use this in negotiations with your insurer to come to an acceptable price. Step 2: Call Your Broker The next step is to call your broker and familiarize them with the policy requirements. In some cases, your premium will already cover your partner’s limits and minimums, so your broker will contact your insurer to provide the COI. However, if it doesn't, the broker will ask your insurer for a quote on rider coverage for the length of the project. If the risk is high, you will have to pay an additional fee and take out a rider policy, which means extra paperwork. Step 3: Receive the COI The last step is to wait for the COI to arrive. Once you receive the printed certificate, you can send it to your client as proof of insurance and complete any pending negotiations or transactions before beginning work.  While the process is easy to understand, you need to start it early. Obtaining a COI from your broker can sometimes take several weeks. Types of COIs There are three types of COIs that cooperating companies can apply for, depending on the nature of the task in front of them, and the underlying insurance product concerned. Certificate Of Liability Insurance Liability lawsuit costs and settlements can run into the millions. Therefore, all participating businesses should have insurance that covers the risks they might face. Liability insurance protects the policyholder, certificate holder, and any additional insured. If you are requesting a COI from a third party, check that its insurance offers the right level of coverage and features, and whether additional insureds can be entities, too, not only individuals. Make sure the COI includes a description of the operations your potential partner is working on. You need to confirm that their insurer covers it adequately for the type of work it actually does. Lastly, check that coverage is primary and noncontributory. This means the policyholder’s policy will respond first in the event of a loss, even if there are multiple, overlapping policies all providing similar coverage, and don’t require you to contribute to the premium. Certificate of Auto Liability Insurance If you are working with a vendor that owns, operates, leases, or hires vehicles, you may want an auto COI. These confirm the partner company has sufficient coverage for your operational requirements. Certificate of Workers’ Compensation Insurance Lastly, you may require a certificate of workers’ compensation insurance, and you’ll need to check it’s written in line with the workers’ comp laws in your area. Workers’ compensation ensures that the policyholder has sufficient coverage to pay workers in the event of an injury. How To Check COI Compliance Companies check COI compliance via audits. The auditor must have a good understanding of endorsement terminology, insurance policies, contract requirements, and ACORD forms and standards. COI non-compliance can be extremely costly, because compensation can run into millions of dollars. Therefore, firms must ensure they are fully compliant before proceeding with work. COI Tracking For large companies and those that work with many firms, COI tracking is critical. Many projects require a paper trail comprising hundreds of COIs. In most cases, project managers don’t have the time to manage all those documents, so they use software instead. The benefits include: Managing changes in project scope, conditions, and coverage over time across multiple vendors Detecting coverage gaps that might increase the risk of liability Improving productivity by dedicating fewer staffers to COI administration Automating notifications of coverage lapses When Should You Ask for a Certificate of Insurance? You should always ask for a certificate of insurance if a vendor does work that increases your liability. If you work with a partner, you may still be liable for losses (such as the injury of a colleague), even if they don’t occur on your property. Always verify the COIs before asking the contractor to begin work. Don’t work with any entity that only provides verbal assurance, as this implies a misunderstanding of the terms and conditions of an insurance policy. Wrap Up So, what is a COI? The acronym stands for “certificate of insurance.” This is a mechanism businesses use to reduce their risk whenever they partner with a third-party entity. When you ask for a COI, you verify that your vendor’s insurance policy is sufficient to meet your standards for risk mitigation. And when you supply a COI, you reassure partners that you can cover any losses that occur as a result of your work.

By Danica Jovic April 21,2022

Charitable organizations support and fund causes and initiatives across the world. In this guide, we’ll explore two types of charitable organizations: private foundations and public charities. Although there are similarities, there are important differences in the ways foundations and charities are set up and how funds are collected. In this guide, we’ll delve deeper into the question of private foundation vs public charity, discussing charity and foundation differences and providing a private-public foundation comparison.  What Is a Private Foundation? A private foundation, which may also be known as a private nonprofit, is an independent charitable organization. In most cases, private foundations are established by wealthy individuals, families, or businesses. Unlike public charities, which participate in fundraising activities, private foundations usually generate funds via investment from groups, families, or philanthropists. It’s common for foundations to bear the name of their founding members as part of the organization’s moniker; the Bill and Melinda Gates Foundation is a well-known example of this. Private foundations are eligible for tax-exempt status in the US provided that they operate within IRS guidelines. To qualify as a 501(c)(3) private foundation, the organization must exist to support one of the causes mentioned in the following IRS guidance: “charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals.” The most important foundation and 501(c)(3) comparison is tax-deductible status. Donations to all charities, including private and public foundations that qualify as 501(c)(3) entities are tax-deductible to donors.  How Do Private Foundations Work? Typically, private nonprofit organizations are set up by sole benefactors, families, or companies. In most cases, the foundation uses an endowment (an initial investment) to generate funds, which are then distributed to causes, initiatives, programs, or schemes run by other individuals or charities. The structure of a private foundation contributes to stability and consistency, as the investment products usually generate a steady, reliable income. This makes budgeting simpler and enables boards, panels or individuals to decide where to spend money and how to make funding choices.  As private foundations are run by donors, they maintain control of: The foundation’s purpose and funding goals and objectives The makeup of the board Funding decisions and the disbursement of funds Which causes to support What Are Public Charities? Public charities are charitable organizations that rely on donations from the general public to support good causes and initiatives. IRS public charities are required to generate at least 33.3% of their income from contributions from the public or meet the criteria set out in the 10% facts and circumstances test. If you operate a public charity, the funds you collect from members of the public are used directly to support your endeavors, for example, giving shelter and meals to homeless people or providing healthcare.  It is critical for boards that run public charities to demonstrate that the acquisition of funds is not carried out to serve the interests of board members or donors. The sole aim must be to support charitable causes through grants and fundraising.  As public charities depend on donations from the general public, they must form a panel of independent members. The board should meet regularly and take responsibility for decision-making. The board should be diverse and it should represent the purpose the organization serves. A public charity board should not include several members of the same family.  Private Foundation vs Public Charity: The Key Differences The most significant difference between a public charity and a private foundation is the way in which funds are acquired. However, there are several important differences to be aware of. These include: Funding Funding is the most significant point to address when discussing charity and foundation differences. Private foundations are usually funded by a charity endowment, an investment made by the benefactor or corporation. The funds generated by the endowment are distributed in line with the foundation’s purpose and funding objectives. Public charities are supported by donations from members of the public, which are usually collected through grants, fundraising campaigns, one-off donations, or regular contributions.   Grant-making Private foundations often make grants, which are distributed to charities or other organizations. Public charities usually rely on donations from members of the public. It is possible for public charitable organizations to make grants, but this is much less common than for private foundations. Private foundations donate money to public charities or causes, while public charities use funds directly to benefit those in need.  Public Support Public charities must demonstrate that they receive a level of support from the general public to meet IRS criteria. Private foundations are not prohibited from fundraising and they can accept public donations, but most are entirely self-funded.  Board A private foundation is typically run by an individual or a board comprising family members or executives from the same corporation. Public charities must have a diverse board that reflects the charity’s mission; they should not have boards made up of family members or multiple individuals from the same businesses or organizations.  Setup A private foundation requires investment and is usually more expensive to establish. All charitable organizations start life as private foundations. Public charities must prove that they generate at least a third of their income from public donations to qualify for IRS exemption.  Control Running a private foundation is very different from being a board member of a public charity when it comes to control. Individuals and families that operate according to private foundation rules have much greater control than public charity board members. They decide where the money goes and how and when it is spent. Public charities should have a diverse panel of board members and are required to form a quorum to carry out official business.  Public Foundation vs Private Foundation: What Is the Difference? It’s common to come across the terms public foundation and private foundation when researching or reading about charitable organizations. A private foundation is not the same as a public foundation; the latter is another name for a public charity. Many charities have ‘foundation’ in their name, for example, the Make-A-Wish Foundation. Public foundations are funded by donations from members of the public, businesses, private foundations, and the government. Private foundations are funded by individuals, corporations, or families. They are not reliant on public support and maintain control of all funding decisions.  Types of Private Foundation There are two types of private foundations: operating and non-operating foundations. Non-operating foundations: Non-operating foundations are the most common type of private foundation. These organizations provide grants for public charities. Private foundations can generate funds through fundraising activities, but non-operating foundations are not typically involved in running programs. Non-operating private foundations are required to distribute a minimum of 5% of their net investment annually. Operating foundations: Operating foundations are actually involved and engaged in running charitable programs on a continual basis. To ensure that foundations continue to support initiatives in a sustainable manner, they must contribute a sizable portion - around 85% - of net investment assets per year. Operating foundations undertake charitable activities rather than providing grants for public charities. Examples include setting up and running an animal shelter or buying and delivering food supplies, rather than donating to a food bank.  Private Foundation Rules To operate a private foundation, individuals, groups, and corporations must be aware of private foundation rules and submit the required legal papers for foundations and charities. The rules relate primarily to taxation and include the following: Private foundations must distribute around 5% of the previous year’s net investment assets per year. They must provide grants to other charitable organizations rather than individuals (although this may be permitted in certain circumstances, for example, supporting an individual through education). They have to pay 1-2% excise tax on net investment income. Public Charity and Nonprofit Comparison When reading about charitable organizations, it’s understandable to have questions about nonprofit and foundation differences and make public charity and nonprofit comparisons. Nonprofit is an umbrella term that covers a broad spectrum of organizations. Public charities and private foundations are nonprofits, which means that they are run for the benefit of communities or public or social initiatives. Nonprofits are not run to generate profits for donors, owners, or supporters.  What Are the Pros and Cons of Private Foundations? If you want to support good causes, you may be thinking about setting up a private foundation. Here are some pros and cons to consider: Pros Permanence: Private foundations can operate for many years, providing support to recipients on a consistent basis.  Control: Private foundations enjoy a much greater level of control than public charities. Individuals and families have the ability to decide how to spend their money, when to donate to causes, and how much to distribute in grants. Legacy: Many individuals and families decide to establish a private foundation to form a legacy, which can strengthen ties for the future or commemorate those who have passed.  Tax benefits: Private foundations that meet 501(c)(3) criteria are tax-exempt. Contributors can usually claim donations as deductibles and benefactors can collect donations without paying tax on them.  Opportunities: As the rules are more lenient for private foundations than public charities, foundations can take advantage of a wider range of opportunities, including donating to individuals, making international grants, offering scholarships, or setting up and running their own charitable schemes.  Cons Significant setup funds: To establish a private foundation, you need to have a substantial endowment to invest.  Time commitments: Running a private foundation isn’t for the faint-hearted; it takes up a lot of your time.  Record keeping and administration requirements: The paperwork demands of establishing and managing a private foundation can be overwhelming. Summary Private foundations and public charities are both forms of charitable organizations. Private foundations are usually established by individuals, families, or companies, and they make grants and distribute funds through their own investment assets and funds. Public charities rely on donations from the public and they support good causes, communities, and individuals directly.  It’s important to understand the differences between private foundations and public charities if you want to support projects or programs, or if you’re thinking about setting up a foundation. Private foundations retain control of funding decisions, but they’re expensive to set up and they often require a lot of time and effort, particularly during the early stages. Public charities have diverse boards, which are responsible for making decisions, but they are governed by rules that dictate how money is collected and spent.

By Danica Jovic May 06,2022

Introduction Setting up a new venture always requires a certain amount of investment. But it doesn’t have to be exorbitant, as there are many ways to make money through good business ideas with low startup costs. If you’re ready to become your own boss or considering a change of career, and you’re exploring easy businesses to start as a side hustle, you’ve come to the right place. In this informative guide, we’ll outline the best businesses to start with little money and share tips and tricks on how to set up this kind of venture.  Businesses With Low Startup Costs: 15 Ideas To Inspire You If you’ve ever watched Hollywood blockbusters or read articles written by business moguls who have built empires from scratch, you’ll know that it’s possible to turn low-cost business ideas into multinational corporations that generate millions of dollars in profits. Even though not every story is a success, it’s important to understand that you don’t need substantial capital to strike it rich as an entrepreneur.  If you want to be your own boss but you’re on a shoestring budget, it’s wise to consider home business ideas and focus on the cheapest businesses to start. We’ve put together a list of easy businesses to start to inspire you and get you thinking about your next professional move.  1. Blogging Do you love to write, share opinions or engage with people online? Do you have passions or hobbies that you’re keen to talk about, or do you have experience or skills that could benefit others and help you connect with like-minded souls? Blogging is one of the most popular ways to boost your income if you’re thinking about starting a business with no money. You don’t need employees, and you can work from home or on the go. Best of all, you can scale the venture as your following grows.  Studies suggest that there are currently over 600 million blogs in the world. Despite the marketplace already being saturated, blogging can still prove lucrative in 2022. To maximize your chances of making profits and attracting attention, you should focus on a niche and cover subjects that interest you. Think about your target audience, create fresh, interesting, original content, and encourage people to check out your articles and interact with you and other readers. Setting up a blog as a low-investment business rather than a hobby requires you to think about how to monetize the site. Various options to explore include affiliate marketing, paid reviews, membership schemes, and exclusive content and advertising. Browse high-profile, popular blogs, see how bloggers make their money, and use social media to build a following, drive traffic, and get people talking about your content.  2. Social media consulting If you’re a whizz when it comes to social media, you could leverage your skills to set up a new business providing services for companies or entrepreneurs whose objective is to boost sales or put their brand on the map. If you understand how social platforms work, you enjoy posting and sharing content and engaging with followers, this could be the perfect option for you. It’s one of the easiest businesses to start if you know your way around Twitter, Facebook, and Instagram and you have a good grasp of the basics of social media marketing. Most big companies have dedicated teams for social media management and marketing, but small businesses don’t have the budget for such a luxury. This is where your skills could come in handy. Since it’s a cheap business to start, it could give you extra income and the opportunity to grow and expand your client base quickly.  3. Teaching and tutoring Teaching and tutoring are excellent home business ideas with low startup costs. Not only does teaching give you the opportunity to use your skills, knowledge, and experience to benefit others, but you can increase your earnings in the process. If you have qualifications in accounting, graphic design or website development, you are fluent in foreign languages, have expertise in subjects such as geography or English, or play a musical instrument, for example, you can offer your services to teach others from the comfort of your home. As far as low startup cost businesses go, this is one of the best options for those looking for a flexible venture that offers the opportunity to expand your network. If you decide that you want to teach or offer private tutoring services, advertise your business online using local SEO and post flyers in your area. Tell people about your business in local and community social media groups and spread the word via colleagues, friends, neighbors, and family members. Ask your clients to leave reviews and recommend you to others so that you can grow your business.  4. Handyman/ odd jobs Most homeowners could rattle off a list of jobs they need done around the house. They represent an excellent client base that a handyman/ odd-job service provider could cater to. It’s one of the best businesses to start with little money because you don’t need a lot of capital; you can build a client list through word of mouth and cheap marketing methods. Even though you don’t need formal qualifications to be a handyman or handywoman, it’s important that you have the necessary skills to tackle the tasks you take on and meet customer expectations.  Setting up a handyman and odd-job service is one of the cheapest businesses to start from home, but you may need to spend some money at the outset on tools, equipment, and marketing. Look for deals, compare prices, and ask to borrow more expensive items from people you know until your business grows. Rent the machines that you’ll be using occasionally instead of buying them at the outset and use cost-effective marketing techniques, such as flyers, social media, and local SEO. Of course, safety first: Don’t forget to purchase the protective gear required for the tasks you’ll be performing. 5. Creating your online store Online stores are among the most profitable small businesses. As online shopping becomes more popular and screen time increases, more and more consumers opt to buy from websites and apps rather than going to the mall. Creating your online store may not be the cheapest business to start, but it doesn’t have to be expensive, especially if you have relatively low product development costs. Before you start selling, compare platforms and marketplaces, take a look at existing stores and gather ideas, research impactful design and marketing strategies, and define your target group.  If you’re looking for low-cost business ideas with high profit, think carefully about what you’re going to sell and how much you’re going to buy and sell for. You could sell products you make on platforms like Etsy, for example: clothing, accessories, jewelry, furniture or pieces of art, or you could look into buying and selling through sites like eBay. It’s worth spending time on research to make sure that there is a demand for your products. Moreover, you should calculate costs and establish suitable price points based on the target customer and competitor pricing strategies to define the most profitable route to take. 6. Online courses and tuition Online education is booming. More people are learning online than ever before, and this is a trend that is set to gather pace in the months and years to come. If you’re exploring ideas for profitable businesses with low startup costs, and you have knowledge, skills, and expertise in specific areas or subjects, you could create online courses or offer tuition via video platforms and social apps. From yoga and personal training to language classes and online courses about software development, accounting, or web design, there’s scope to use your professional experience, hobbies, and interests to add to your income. This is one of the cheapest businesses to start from home, and it offers considerable flexibility, as you can schedule classes for times that suit you. What’s more, you could provide courses that people can access remotely or download. 7. Resume writer Businesses with low overheads are ideal for aspiring entrepreneurs who want to start making money without worrying about expenses. Being a resume writer is one of the most inexpensive businesses to start. Whether you decide to set up a side hustle for extra income or have grand plans to turn a solo venture into a big business in the future, you can get started straight away with minimal investment. To offer this service, you should have a firm grasp of the labor market and what makes an effective resume. In turn, this will enable you to provide a tailored service for your customers, which will help them secure roles that match their skills and level of experience. Resumes may all look similar, but they should be adjusted to ensure that the content is engaging and relevant to the role in question.  8. Social media influencing Most of us are familiar with influencers and social media users who have built up enormous followings and whose profiles and accounts rake in substantial profits. It’s not easy to create content that will earn thousands of dollars per post, and it may take time to build a following, but it’s possible to turn a low-cost business opportunity into a profitable venture.  If you like the idea of becoming an influencer, find a niche and start contacting brands so that you can post content that will resonate with your followers and become commercially viable in the process. Inspire existing followers to share your posts, and consider running giveaways to get people to follow you and take an interest. Promote products that are relevant to your personal brand, your passions, and your target customer. Interact with your followers, get to know brands, and build relationships with them, seizing all opportunities to network.  9. Freelance writing Freelancing has become increasingly popular as people seek alternatives to a traditional 9-5 job. Freelance writing is a low-budget business idea which can help you boost your earnings and establish a reputation within the industry. There are multiple paths to explore if you’re looking for low startup cost business ideas, including writing for blogs, using websites and portals to find jobs that involve writing, signing up with agencies, and writing for companies on a freelance basis.  Freelancing is not as stable and secure as conventional employment when it comes to payment and income, so it’s crucial to establish a client base and manage your money prudently. Think about how you’re going to attract clients and find work, research rates, and market your services via social media. Design a website to describe the services you offer and provide information about your qualifications and experience, sharing some pieces and showcasing your writing style.  10. Personal training Are you passionate about health and fitness? Do you want to help others reap the rewards of regular exercise or a new, targeted training regime? If so, personal training services could be a new business idea worth exploring. Being a personal trainer is rewarding and can also be quite lucrative. If you love to work out, you can use your passion for this lifestyle to motivate and guide others. It’s worth noting that you’ll need certificates and proper training to start offering services, but once you have the recommended qualifications, you can earn a lot of money in a short time.  Setting up at home is a great idea if you’re looking for the best business to start with little money, as your overheads will be low. This will help you generate profits faster. You could also run online classes and sessions or create an app or a website with a members’ community. Another option if you don’t want to rent premises or pay to use a gym is to visit clients and make use of their homes as training spaces.  11. Dog walking and sitting Did you know that there are over 76 million pet dogs in the US alone? Dogs are wonderful companions, but they need a lot of care and attention. For many families, owning a dog can be difficult due to work commitments and the desire to travel or take vacations. This is where dog walkers and house sitters come in handy. A cheap business to start, dog walking meets a market need by providing services for people who have pets but find it inconvenient to walk them during the day. By using a dog walking service, people can add a furry friend to the family without worrying if they’ll get enough exercise or become lonely while the owners are at work.  The advantage of a low capital business is that you don’t need to spend a lot of money at the outset. You can advertise via local magazines and newspapers, flyers, and social media, encourage customers to spread the word and scale your business as the demand grows. You’ll need a vehicle if you plan to travel outside of your local area. If your business becomes a success, you could consider expanding by hiring more dog walkers or adding services, such as house sitting or doggy daycare.  12. Virtual assistant As our lifestyles are becoming increasingly rushed, many people have hectic schedules and are struggling to manage their diaries. If you have strong organizational and time management skills, you can use your expertise to offer this service to those who are daunted by their to-do lists. If you’re interested in profitable businesses with low startup costs, being a virtual assistant is a marvellous idea. You can work from home, which means low overheads, and you can add clients as you go along once you start receiving more inquiries.  It’s a good idea to target people who have busy schedules, such as business owners, professionals, and working parents. You can advertise your services through social media, a website, and local press. Research the market to learn more about your target audience, establish a pricing strategy, and get to know more about how being a virtual PA works.  13. Gift ideas Do people always compliment you on the gifts you buy or come to you for advice when they need a bolt of inspiration for a birthday or wedding present? If so, have you thought about turning your talent into a business? Many people don’t have time to trawl websites or stores looking for gifts, or they just can’t come up with original, imaginative ideas. If you have a reputation for choosing fantastic presents or conjuring up inventive ideas, this is an easy business to start from scratch. You can offer customers a bespoke service to help them take the stress out of sourcing and buying gifts or organizing experiences. By hiring your business, customers can save time and effort while ensuring that the people they love will adore their gifts.  14. Proofreading Are you meticulous when it comes to grammar? Do you have an eye for detail? Do you enjoy reading and writing? If so, why not set up a proofreading business? If you have an outstanding grasp of grammar and punctuation, this is a great home business idea with low startup costs. All you need to get started is a computer. You can work at home or remotely, with compete control over your schedule and pricing strategy, choosing which jobs to take on or turn down, all while your running costs are kept at a minimum. It is critical to ensure that you have the relevant skills and knowledge to offer this service to paying clients. If you make mistakes or fail to notice and correct errors, customers may ask for refunds and may leave negative feedback. 15. Event planning Are you the go-to party planner in your circle of friends, or do your family members rely on you to manage their social schedule and organize gatherings for special occasions? Event planning is a skill in high demand. From parties, weddings, and garden gatherings to corporate events, competitions, and charity functions, there is room in the market for a wide range of services to cater to diverse clients.  To excel in this role, you need to have superb communication, organization, and time management skills. Even though it’s not one of the easiest businesses to start, it can be profitable, as clients strive to make an impact with their event and will invest substantial sums to impress their guests. Start small and build a network of contacts. As you gain more experience, you should find it easier to plan events, which will enable you to take on bigger, more valuable contracts and expand your customer base.  How To Start a Business With No Money - Top Tips Starting a business with no money is no mean feat, but it’s possible to turn a small startup into a profitable venture. If you’re looking for low-cost business ideas with high profits, here are some tips to help you maximize your chances of success: Devise solutions for common problems: One of the best ways to make money through new business ideas is to identify some common issues and find solutions to address them. Think about the problems you want to solve in your life or the issues you hear friends, family members or colleagues talking about.  Play to your strengths: Think about your skills, qualifications, and experience when considering startup ideas. From language skills, cooking, playing musical instruments or singing, designing websites, bookkeeping or managing your diary to playing sports, training, marketing and building apps, there are all kinds of opportunities to make money based on your existing skillset.  Conduct research: Research is essential for any aspiring entrepreneur. Use market research methods to gauge the level of demand for the products or services you’re offering, identify competitors, define ideal buyers, and set price points.  Manage your finances: Managing your finances from the outset is vital if you’re looking for low-cost business ideas with high profit margins. Try to keep initial expenses and overheads low while building a client base and bringing sales in.  Spread the word: Running a profitable venture takes more than an ingenious low budget business idea. To make your new business work, you have to attract customers and encourage prospective clients to take the next step and actually spend money. Think of all the ways to spread the word and calculate marketing costs accordingly. Popular marketing techniques for businesses with low overheads include local SEO, social media marketing, and flyers.  Take inspiration from your passions: Your passions and interests can help you identify possible business ideas and narrow down your options. It’s possible to monetize hobbies, for example, baking, fitness, playing music, writing, and spending time on social media. If you run a business that allows you to do the things you love and help others do the same, this will not only boost your bank balance, but it should also give you a sense of satisfaction.  Summary More and more people are pursuing the dream of becoming their own boss. If you want to be a successful entrepreneur, you don’t have to spend a fortune getting your new venture off the ground. These low-cost business ideas can help you build a profitable business without worrying about investment sources or bills while you’re still trying to find customers. If you’re on a tight budget but still intend to set up your small business, take inspiration from this guide and explore business ideas with low startup costs!

By Danica Jovic May 06,2022

Assets are valuable resources owned by an individual, a company, or a government. They allow businesses to make money, increase value, and help the organization run. In modern business, assets can refer to any item or value, from physical property and equipment to financial resources and intellectual property. In this article, we'll explore the concept of assets and define this important term. What Are Business Assets? Assets’ business definition says that a business asset is a valuable resource a company owns and further uses to generate revenue.  Businesses invest in various assets depending on their specific needs and goals, such as real estate for retail stores or proprietary technology for product development. Companies typically use their assets in some way to make revenue. Some common business assets examples are:  Physical property: Any real estate owned by the company and any equipment or machinery used in business operations. Intellectual property: Any creative or innovative products of the mind, such as patents, trademarks, and copyrights. Human capital: The skills and knowledge of the company's employees, which are used to achieve earnings and the company’s goals.  How Do Business Assets Work?  To further define assets in business, it's important to understand the difference between assets and liabilities. Assets can be anything a company owns, while liabilities are owed. For example, a company's inventory would be considered an asset, as it can be sold to make a profit. A company's loan payments, on the other hand, would be viewed as a liability.  A balance sheet is a statement of financial position. It lists all of the company's assets and liabilities and other corporate financial data. The order in which financial assets are listed on the balance sheet is telling - the most liquid assets are listed at the top, and items at the bottom of the company asset list are considered the least liquid. Asset liquidity depends on how easily the items in question can be converted to cash.  When liquidating your assets, you should be aware of asset depreciation and market value. The value of an asset changes over time, affecting how much of its worth you can write off. If you decide to sell your business’s assets for a profit, you may end up paying capital gains tax. Types of Financial Assets There are many different types of business assets. Some of the most common include cash, accounts receivable, inventory, investments, property, vehicles, and office furniture. Here's what you need to know about different ways of classifying them:  Tangible and Intangible Assets Tangible assets are physical in nature, and intangible assets are nonphysical. Both types are vital to businesses. A tangible asset is all physical and can be used to generate revenue through the company's operations. Some tangible business assets examples include real estate, inventory, and vehicles.  On the other hand, intangible assets are nonphysical and include intellectual property, patents, or goodwill. Intangible assets do not need to be manufactured or physically built, but they can still be sold or licensed. A company can also earn intangible assets over time through unique activities or circumstances that set a business apart from its competition. Current Assets and Noncurrent Assets Current assets are fairly liquid and can be easily converted. They include cash, accounts receivable, and inventory. Current assets are used in operations or are expected to be turned into cash within a year. Noncurrent assets, also known as fixed assets or long-term assets, are things such as property and equipment that can’t easily convert to cash.  Nonoperating and Operating Assets The other way of categorizing different types of assets is by operating and nonoperating assets. Operating assets are used in the day-to-day operations of a business and include cash, inventory, and equipment. Nonoperating assets are not used in daily operations but may still be valuable to the company. They involve investments in other companies or property. Assets in business can also be classified by their usage, convertibility, and physical existence. Can the Value of Business Assets Change Over Time? The value of business assets can change over time for several reasons. For example, an increase in demand for certain products may reduce inventory levels and lead to higher values for fixed assets like machinery and equipment. Changes in technology or consumer preferences can also impact the value of both tangible and intangible business assets. As businesses evolve, it’s essential to keep track of the value of assets in business. A clear and accurate balance sheet can help make strategic decisions about how best to use and maintain resources. Ultimately, a company's success will depend on managing business assets effectively and maximizing their potential value over time. How To Determine the Value of an Asset The value of an asset is the amount for which it can be sold or exchanged. It can be determined by several methods, including the cost and market methods.  The cost method is one of the simplest ways to determine the value of company assets. It only considers what it costs to purchase or produce the asset and not any other factors such as depreciation. The market method considers factors such as supply and demand when setting the value of an asset. This method is more complex than the cost method but more accurately represents an asset's worth.

By Danica Jovic May 09,2022

When you’re about to launch your company, choosing a name is at the top of the list of tasks. However, to be safe, first you need to check that it doesn’t violate any existing trademarks. If it does, you could face a lawsuit.  Furthermore, if there’s a name you love, it would be a good idea to avoid creating any marketing materials or building a website until you’ve run it through a business name checker. Otherwise, you may have to rework everything, losing money in the process.  In this post, we discuss how to check if a business name is taken. You’ll then learn how you can register your business name to protect it.  Ways To Find out if a Business Name Is Unavailable Here are some methods for ascertaining if a business name is taken. State Business Name Search  Each US state has an agency responsible for business filings that allows you to check if a business name is already in use. You either make a formal request using a form – the old-fashioned way – or you search its publicly available databases online. If you search online, it will take mere seconds to find out whether your company name is taken.  If you find a name that is similar to yours, but not the same, you’ll want to check your state’s rules for what is acceptable, and what is not. For instance, you may not be allowed to register the name MacDonald’s because it is too similar to McDonald’s. As each state has slightly different rules, if in doubt, contact an attorney. Trademark Business Name Check Whenever companies create a new trademark, they add it to the US Patent and Trademark Office (USPTO) register, which becomes searchable by anyone in the business community. A trademark business name check is a nationwide, federal-level check that allows you to see all of the current trademarks.  You’re most likely to run into trademark business name problems if: The company name is taken or similar to an existing company You operate in a similar industry to a company with a similar name to yours If you aren’t sure whether the name resembles an existing firm’s, then you will need to speak with a trademarking lawyer. They can provide you with further advice.  Check the “Doing Business As” (DBA) Register Some states require businesses to register under a fictitious name with either the county or the city. Companies don’t always use these names for customer-facing purposes, but they do for registration. As such, they often have common law rights to their fictitious names, so you will need to avoid using them.  You can look for DBA name availability by checking DBA registrations. There might be businesses operating in the local area with names similar to the one that you want, even if they do not use them for their brand.  Google Search While Google shouldn’t be your primary means of checking business name availability, it can be a helpful tool. State and national registers may contain errors or incorrect details for some trademarks in operation. Some firms might also be using trademarks that they never registered.  Besides, you may simply wish to check what Google results come up when you type in your company name ideas. You may find, for instance, that:  The search term is too competitive, and the name is close to a common keyword that prevents you from showing up on the first page A business with a similar name sells the same products and services as you There is a company in your local area using a business name that they have not trademarked You can also perform a Google Domain search to find available business names. This lets you see whether anyone else has registered the URL of your business name. For example, if you are a bookkeeper, you might want as your URL, so it’s worth checking out if the domain is free. Sometimes you will discover that the company name is available on official registers but that the domain is already taken. This could be because the company went out of business but still owns the URLs, or it could mean that somebody took the name in the hope of selling it for a higher price later on. Either way, you may want to reconsider the name if the domain has been claimed or is behind a high paywall.   How To Register Your Business Name In the US, there are four ways to register a business name.  Entity Name Entity names protect the name of your business at the state level. However, whether you need to register legally depends on the state in question.  Business name registration allows the state to identify your business. Most states only permit you to take available business names, though there are exceptions.  Once you have a company name and register it with the relevant formation agency, you have the protection of that name. Your business will appear in the register whenever other entrepreneurs check company name availability.  Doing Business As (DBA) Names States, cities, and counties sometimes require business owners to register their DBA name with them, sometimes called a trade name, or fictitious name. DBA names don’t provide legal protection, but many jurisdictions require them for setting up a business.  Even if you don’t have to set up a DBA by law, it might still be a good idea. DBAs can shield your personal identity from your business name, making you less searchable online. Setting one up also entitles you to a federal tax ID number (EIN) which you can then use to open a business bank account.  States typically allow more leeway for DBAs than for entities. For instance, you can be broader in your descriptions of your business's function.  Domain Name Registering your domain name is essential for the online presence of your business. Ideally, you want a URL that reflects the branding, nature, and mission of your firm. Website names don’t need to be identical to your company name, and are acceptable as long as users can easily recognize that they are linked to your business. Domain names, like trademarks, can last as long as you own them. However, you will need to pay an annual fee to an online register to keep your site.  Businesses register domain names through registrar services, so you’ll need to pick a reliable registrar from an approved directory.  Trademark Lastly, trade name registration is also important. You can use it to protect the name of your business, goods, and services at the federal level.  For instance, Microsoft Corporation is the entity name, while Dynamics 365 is a trademarked service name. Nobody else in the computer software industry can use Dynamics 365 to name their products. If they do, they risk infringement lawsuits.  Trademarking is an effective way to prevent competitors from stealing your ideas. Once your names are in the USPTO’s official trademark database, you can launch lawsuits against any company that copies them. Summary of Business Registration Once you've selected a suitable business name, you must register it. Here’s a summary of what you need to do:  Protect your name at the state level with an entity name Protect your name at the federal level with a trademark name Register a DBA name if required by the state Register a domain name that is similar to your brand name and easily recognized by your customers You can choose the same name for each registration or opt for a different one for every task. Recommendations Once you know how to check if a business name is taken, you can proceed with launching your business operations. Make sure that you consult all the registers described here, both at the state and federal levels, before taking the plunge and opening up your business to the public. This kind of caution is indispensable for ensuring you’re not using a trademarked name, as you could face hefty damages if you are.

By Danica Jovic May 12,2022