By An LLC (Limited Liability Company) and Trademark both can protect your business in different ways. Before you register for any of them, you must know the basic differences between LLC vs. Trademark.
With an LLC, members are not liable personally for the business debts and obligations. Meanwhile, trademark is a form of intellectual property that protects the unique branding of a business. Both can help you with damage control.
Are you still confused about which one to choose from? Here I am to guide you.
Limited Liability Company (LLC) is an incredible business structure to protect your company. The main purpose of an LLC is to provide liability protection to personal assets.
It will protect owners from repayments and debts of the company. Another important factor that can help you out is pass-through taxation.
Also, there will be additional benefits like heightened credibility, flexible membership, and limited compliance requirements.
What Trademarks Do For My Business?
Trademark is a legal business system that provides individual significance for your business.
A trademark will protect your business with certain specific goals and limitations. It can provide you with a unique name, logo, or symbol.
Trademarks are registered with the governmental regulations. It can be renewed periodically to maintain protection.
It will increase the brand value of your company and address cyber-squatting.
Is An LLC A Trademark?
No, LLC is not a trademark. Both of them are somehow similar to protect your business financially. But the method of working these two structure are completely different, Difference Between LLC & Trademark.
Also, the way of registering by the government is different. They have different ways to focus on receiving approval.
Difference Between LLC Vs Trademark
LLC and Trademark are distinct business protection structures. Among hundreds of differences, here I will simplify the entire thing with a few points only. Check here to know the basic yet core five differences:
Features | LLC | Trademark |
|---|---|---|
What they protect | Personal Asset | Brands |
Governed By | Laws of the state | Federal Trademark Statute |
How to get them | State Secretariat Office | US Patent and Trademark office |
What they cost | Filing cost according to the state | Same filing cost |
How long they take to get | A week or less | An year or more |
Business Entity Registration | State based | State & Federal |
Transferability | Operating agreement | Sold with business |
Let me describe these differences with a description. It will make you understand both LLC Vs. Trademark in detail:
An LLC tends to provide limited liability protection to its owner’s assets. A trademark, on the other hand, protects the brand identity of a business. IT can help you with preventing others from using similar marks that could confuse consumers.
Your Trademark for the business will be governed according to the Federal Trademark.
An LLC is typically formed when a business is established, while a trademark can be registered at any time to protect a business’s brand identity.
A Limited Liability Company is registered with the state in which the business operates. In contrast, a trademark is registered with the United States Patent and Trademark Office (USPTO) or a similar agency in another country.
The expenses of forming an LLC and Trademark both depend upon the processing. An LLC formation cost will be somewhere between $300 to $1000.
On the contrary, how much does it cost to Trademark a business name? You might have to pay any amount between $350 to $450. However, the exact cost will vary depending on the state you’re forming these business entities.
An LLC can take between three to seven working days You can even apply for it urgently.
If you want to transfer the LLC, it will be done according to the operating agreement. That’s why an operating agreement is so necessary for an LLC. But, transferring the Trademark will be completely maintained by the ownership.
Do I Need A Trademark If I Have An LLC?
There is no written rule that you can not have LLC if you have a trademark for a business and vice versa.
Instead, LLC and Trademark can help you out together. I would suggest you get both to enjoy the advantages of both of them.
None of them will interrupt one another. If you do the paperwork and application process carefully, you can easily safeguard the business.
LLC alone might not be enough to protect your business. This gap will be filled up with Trademarks.
Trademark Or LLC First?
You should get an LLC before receiving a trademark.
Having an LLC for your business will make you an owner automatically. Once the business is formed, you can apply for the Trademark easily. This is a more structured way to manage the business protection systems.
Your LLC can apply for a federal trademark application with the LLC’s legal name and address. This cost of paperwork hassles a lot. Also, with an LLC, you can be assured that the Trademark is in use. Your sales and services will be structurally controlled with this Trademark.
However, if federal rights are your priority, you can apply for a trademark first, too. A trademark is going to give you backup protection for the business.
No one is going to charge you for that. There is no strict rule on this, and the order may vary based on individual circumstances and priorities. It is important to consult with a legal professional for guidance on the specific steps to take to protect your business name and brand.
Does An LLC Protect Your Business Name?
No, LLCs are not able to protect your business name. They do not possess any rights over your brand name. That means someone else can easily use your brand name and start a sub-business unofficially.
A trademark will be your savior here. Your brand will get a distinct value and identity in the market.
Is Trademark Really a Savior? Advantages & Disadvantages
Even if you have a firmed LLC for your business, a trademark is necessary. However, many also do not prefer having a trademark. It’s because Trademark has its advantages and disadvantages.
You must check on them before making any decision.
Trademark Advantages
- You can have legal protection of your brand name, logo, or slogan, preventing others from using it without your permission.
- A strong trademark can set your business apart from competitors. It also attracts customers to your products or services.
- You will get the exclusive right to use your brand name, logo, or slogan in connection with your products or services enable you to take legal action against infringers.
- Trademarks can be registered internationally, protecting your brand in multiple countries.
- Trademarks can be licensed or franchised to generate additional revenue streams for your business.
- A trademark is a long-lasting commitment. Once the documentations are done, it can last for 100 years.
Trademark Disadvantages
- Getting a Trademark is quite time-consuming. You have to wait a whole year at least.
- Obtaining and maintaining a trademark can be time-consuming and expensive. The filing costs are nothing too much. However, if you are enforcing trademarks against infringers, it can be costly and time-consuming.
- Protecting non-traditional marks, such as sounds, colors, scents, or shapes, can be more challenging and may require additional evidence of distinctiveness.
- Trademarks can be lost if they are not actively used or are improperly maintained. Failure to use a trademark or defend against infringement can result in the loss of rights.
- Applying for a trademark requires you to go through extra paperwork. It is quite drastic for any business owner.
How To Check If A Business Name Is Trademarked?
To check if a business name is trademarked, you can follow these steps:
- Visit the United States Patent and Trademark Office (USPTO) website at www.uspto.gov.
- Use the free websites to look up the business name you are interested in trademarking.
- If the name is not trademarked, you can go to the processing to secure your business name.
- If the name is already trademarked, you may need to choose a different business name or consider reaching out to the trademark holder to discuss licensing or other arrangements.
Wrap Up
The conclusion is the specific goal of LLC and Trademark. LLC is a specific business entity that can protect your assets as an owner. In contrast, a trademark registration is going to protect your brand.
However, before forming an LLC or Trademark, you must consider the pros and cons carefully. After all, it’s about your business’s privacy and protection.
Key Points
- LLC and Trademark both tend to help you out with your business.
- LLC will protect your personal asset as a business owner
- Trademark tends to protect your business as a brand
- Both LLC and Trademark will increase acceptance and credibility of the business to your consumers
- LLC formation and Trademark both depend upon paperwork and governmental approval
- LLC formation is quicker than Trademark registration. Trademark registration is more time consuming and LLC formation.
- YOu will need a trademark even if you have an LLC registered for the business.
- You should get an LLC first before you register for a Trademark.
Frequently Asked Questions
No, LLC will not get to protect your Trademark. LLC is just to protect your business liability. If you want to protect your brand name, sign up for a trademark.
A trademark symbol will make your businesses claim exclusive rights to branding and prevent others from using or misusing the marks. It also helps to build brand recognition and value. Consumers can easily identify and associate a specific mark with a particular company or product.
Trademarks generally do not expire after some time. Unlike patents and copyrights, trademarks do not carry any expiration date and can last indefinitely as long as they continue to serve as brand identifiers.
