Is it better to trademark or LLC?
Asked by: Merritt Kiehn | Last update: February 14, 2026Score: 4.4/5 (60 votes)
You need both an LLC and a trademark for comprehensive business protection, but form the LLC first, as it's the business entity that will own the trademark, separating personal assets from business liabilities (LLC) while the trademark protects your brand identity (name, logo) nationwide. An LLC secures your personal finances, while a trademark protects your brand's unique identifiers from competitors.
Is a trademark better than an LLC?
An LLC (Limited Liability Company) creates a legal business structure that separates personal and business assets for liability protection, while a trademark protects your brand identity (name, logo, slogan) to prevent consumer confusion, with an LLC being the foundation and a trademark securing your brand's unique identifiers, serving different but complementary roles in business formation and protection. You usually form the LLC first as the legal entity and then register a trademark to protect your specific brand name and logo used within that business.
Should you get a trademark or LLC first?
For most businesses, form your LLC first to establish a legal owner for your brand, then apply for a trademark under the LLC, but always conduct a trademark search before forming the LLC to avoid costly rebrands if the name is already taken. The LLC provides liability protection and a legal entity to own assets like trademarks; however, you need to know the name is clear before registering the LLC.
Is a trademark worth it for small business?
Build a Valuable Business Asset:
A registered trademark is not only a protective tool—it's also a valuable business asset that can appreciate over time. Whether you plan to license, franchise, or eventually sell your business, your trademark can significantly boost your company's overall value.
Should I trademark my name as individual or LLC?
It is better to form an LLC before filing a trademark application. So, before you submit a trademark application, you should create an LLC or other business entity. A business should form an LLC before applying for a trademark because the LLC will own the trademark.
Trademark or LLC... Which Comes First?
What names to avoid for LLC?
You should avoid LLC names that are misleading, offensive, too similar to existing brands, or use restricted words like "Bank," "Trust," or "Insurance" without proper licensing; also steer clear of implying government affiliation or illegal activity and names that are hard to spell or remember, as these can cause legal issues, confusion, or hinder branding.
Do I pay more taxes with an LLC?
Your LLC profits are taxed at your individual income tax rates—just like when your LLC is taxed like a sole proprietorship. No double taxation and you can qualify for the qualified business income deduction.
What are the disadvantages of trademark?
Costs: The process of trademark registration can be costly, especially for small businesses. This includes registration fees, legal costs, and the cost of maintaining the copyright. Time-Consuming Process: Obtaining a copyright can be a lengthy process.
How much should a trademark cost?
A federal trademark costs a base fee of $350 per class to the USPTO, plus potential surcharges for complex applications (like using free-form text), totaling around $350–$850 for basic filings, but can increase significantly with attorney fees (often $1,000+) and ongoing maintenance fees (e.g., $225-$525 every 5-10 years). Costs vary based on filing method (TEAS), the number of goods/services classes, and if you hire a lawyer.
Can someone steal my logo if it's not trademarked?
If your logo is registered with the USPTO (U.S. Patent and Trademark Office), you have a strong legal foundation to stop others from using it. But even without registration, you may still have common law rights if you've been using the logo consistently in commerce.
At what point should I start an LLC?
If your business already earns a profit or if it carries any risk of liability, you should start an LLC immediately. Many folks say you should form an LLC once you earn over $100,000. However, many lawyers insist you start an LLC from the get-go.
What are the three requirements for trademark?
In order to register a trademark, the trademark must meet three requirements: first use in a particular trade or geographic market, non-functionality, and distinctiveness. Generic words, even if stylized or foreign, cannot be registered as trademarks.
What do you call yourself if you own an LLC?
If you own an LLC, you are legally called a Member, but you can use various public-facing titles like Owner, Managing Member, CEO, President, or Founder, depending on your role, state rules, and desired image, as long as it's not misleading and aligns with your operating agreement.
What does LLC not protect against?
If an LLC member personally guarantees a business's loans or obligations, he or she will be held liable for any default. An LLC won't protect a member who commits a wrongful act or is negligent in a way that results in harm to another person, such as fraud or assault.
What is the strongest type of trademark?
Fanciful marks are devices which have been invented for the sole purpose of functioning as a trademark and have no other meaning than acting as a mark. Fanciful marks are considered to be the strongest type of mark.
Should I put LLC on my logo?
So, do you need to incorporate “LLC” in your logo? In short, the answer is no. In fact, none of your branding/marketing needs to include “LLC,” “Inc.” or “Ltd.” If it is included, this may look amateur. Think of national brands such as Target, Starbucks, and Honda.
Can I trademark a logo myself?
You can file a trademark application yourself through the government's website, and it's the cheapest option at $350.
What are common trademark mistakes?
Common trademarking mistakes include, but are not limited to: Poor choice of brand name. Your business name should resonate with your target customer and express what you do using a strong, memorable image or word. Failing to perform a complete search of trademark databases.
How long does a trademark last?
Trademarks do not have expiration dates.
A federal trademark lasts 10 years from the date of registration, with a potentially unlimited number of 10-year renewal terms. So, every 10 years, the owner of a federal trademark registration must renew it with the U.S. Patent and Trademark Office (USPTO).
Should I trademark or LLC first?
For most businesses, form your LLC first to establish a legal owner for your brand, then apply for a trademark under the LLC, but always conduct a trademark search before forming the LLC to avoid costly rebrands if the name is already taken. The LLC provides liability protection and a legal entity to own assets like trademarks; however, you need to know the name is clear before registering the LLC.
What cannot be trademarked?
The following things cannot be registered as trademarks: Deceptive Words, Names, Phrases, Slogans (they are misleading) Merely Descriptive Words (e.g., Best ice cream, Red car) Merely Decorative Features (they don't identify source)
How often do trademarks get rejected?
According to the United States Patent and Trademark Office (USPTO), most applications for trademarks are successful. However, around 1-in-5 trademark applications get rejected annually. For those who spend significant time and resources applying for a trademark, that rejection ratio may seem shocking.
How do LLC owners avoid taxes?
To minimize LLC taxes, maximize deductions (home office, business expenses, depreciation), leverage retirement plans (SEP-IRA, Solo 401(k)), use tax credits, potentially elect S-Corp status to save on self-employment tax, and deduct health insurance, while meticulously tracking all income and expenses for legitimate write-offs.
What are common LLC tax mistakes?
Common LLC tax mistakes include mixing business and personal finances, failing to make estimated tax payments, poor record-keeping, misclassifying workers (employees vs. contractors), not understanding or choosing the correct tax classification (like S-Corp vs. default), ignoring self-employment taxes, missing deadlines, and neglecting state/local tax obligations, all leading to penalties and lost deductions.
How do I pay myself from my LLC?
Methods to pay yourself
There are two primary methods of compensating yourself as an LLC owner: using an owner's draw or paying yourself a salary. An owner's draw involves withdrawing profits directly from the business's earnings.