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"Naming" my sole proprietorship company for 1099 money

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  • "Naming" my sole proprietorship company for 1099 money

    New attending recently out of residency. During my training, I did a few medical surveys for a nominal amount and setup an i401k at Vanguard due to recommendations from this blog - better to have in place and not need it, then not have it setup at all. I essentially titled it with my name and with individual 401k (John Doe i401k). I did not setup a new business banking account and apparently the EIN I selected for the "business" was the wrong one per my accountant and I need to get a new one (easy to change per Vanguard). I only had a few hundred dollars from several years in residency.

    However, now that I am out in the real world as an attending, I have significant 1099 income and will likely be maxing out i401k per year (>300k 1099 money annually). I have been doing a lot of reading in terms of what I need to do to get everything in order and this is my list (followed by some questions, hence my post).

    1- I am a sole proprietor by default. No need for LLC as a doc without employees given my reading and my attorney's recommendations. S-corp cost/benefit doesn't make sense for me at this time either based upon my analysis.

    2- I need to create a "name" for my company that I can use for banking accounts, given W9 forms to people interested in my services, etc... Up this point I just used my name and SSN.

    3- Get a new EIN (since the old one I had was incorrect - I think I had accidentally selected non-profit) and update my Vanguard i401k and use this instead of my SSN for potential people who are hiring (W9 form).

    4-Open a new bank account in my business's name and deposit all earnings there and just transfer to my personal account.

    Questions:

    -What should the name of my company be that is required for my business checking account, i401k, W9 form, etc... I don't think I'll be doing any major enterprises like WCI, so should it be called "John Doe" or "John Doe Emergency Medicine" etc... Essentially what do most independent contractors title their company.

    -Does the name have to be the exact same between my business account, W9, 401k, etc... Ideally that is the case but I already opened my i401k and wasn't sure how easy that is to change or not - or frankly if it even matters that much. Same thing with a business credit card which I have as a slightly different name (Doe Consulting) from the past. Does it really matter all that much in this case if they aren't perfectly the same.

     

    Thanks for the time.

     

     

  • #2
    John Doe, MD is fine for the name of your business. I doubt anyone will cross-check the name against the title on other accounts. The IRS just cares about the EIN.
    Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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    • #3
      Business naming is a somewhat personal decision with some possible small administrative issues.

      Some sole proprietors will want the businesses name to be a brand. Professionals such as physicians, accountants, lawyers, etc... often consider their name their brand. Some will want the limited and I mean limited anonymity of Doing Business As DBA or using a "fictitious name". Finally, in some state and local jurisdictions, there may be registration, licensing and fee differences.

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      • #4




        Business naming is a somewhat personal decision with some possible small administrative issues.

        Some sole proprietors will want the businesses name to be a brand. Professionals such as physicians, accountants, lawyers, etc… often consider their name their brand. Some will want the limited and I mean limited anonymity of Doing Business As DBA or using a “fictitious name”. Finally, in some state and local jurisdictions, there may be registration, licensing and fee differences.
        Click to expand...


        To tag on to that, another consideration is that some states have very specific requirements for how physicians are permitted to name a business, may not permit fictitious names, etc.
        Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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        • #5
          Lucky me - the two people I most wanted their input both commented. Thanks Johanna and spiritrider for the input. Definitely helpful (as always).

           

          John Doe, MD it is!

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          • #6
            Originally posted by jfoxcpacfp View Post
            The IRS just cares about the EIN.
            Does the checking account used need to be opened under your EIN? Could you just open a regular checking account under your name and SSN, and use it strictly for your sole proprietorship income, expenses, and funding i401k?

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            • #7
              There is no requirement for a sole proprietorship using the sole proprietor's name to open business financial accounts using an EIN. It is considered a best practice by most CPAs, to at least open separate personal financial accounts solely for the sole proprietorship's revenue and expenses.

              However, if you are operating under other than your personal name, many financial institutions will not support such transactions to a personal account and may require business accounts with an EIN.

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