Should I File My LLC or Register My Trademark First?

this is a question that has come up multiple times in the latest round of consultations i have had with some budding entrepreneurs…the short answer is: it depends. the long answer —> read below!

First, the basics:

What is a Trademark?

A trademark is a way to distinguish intellectual property, which can include recognizable designs, expressions, signs, or other identifiers. Individuals, legal entities, and companies can all hold trademarks, which are used to differentiate goods and services from one another.

What is an LLC?

An LLC is a business structure that combines the protection of a corporation with the simplicity and tax benefits, including pass through taxation, of a partnership. LLC members or owners are not personally responsible for the company’s debts or legal liabilities, and for tax purposes it uses pass through taxation. Generally speaking, an LLC protects personal assets from business debt.

Now, the Long Answer:

To safeguard personal assets from corporate liabilities and debts, it is usually advisable to first establish a limited liability corporation - especially if you have already been offering your services to consumers or selling your products. Once the LLC is established, you can then consider filing for a trademark to protect your business’s brand identity.

However, if your business relies heavily on a specific brand or trademark, and you are concerned about the possibility of infringement or misappropriation by competitors, you may want to prioritize trademark registration before forming an LLC.

In either case, it’s a good idea to consult with an attorney or other qualified professional to help determine the best approach for your business based on your specific needs and priorities.