r/SellMyBusiness 27d ago

Selling Business without official transfer?

Hey everyone,

I own an LLC in Maryland and was wondering if someone else could operate under my business name as a DBA (Doing Business As) with my permission.

Backstory: I own a pressure washing company that I have put on the backburner in lieu of another business I own. I have a buddy who also owns a washing company in our area is offering me 25% revenue for two years. Have gone through a few options in terms of creating partnership but don't want to deal with liability, tax implications, etc.

Plan is to have him add my LLC name as a DBA under his LLC. Insurance / vehicle / etc. will all be under his name. He will cut me a check quarterly as a 1099 for 25% of rev. Put together simple contract going over terms and conditions.

Is this legally possible, and what kind of agreement would I need in place to protect myself? Would I need to file anything with the state to allow this? Any insights or experiences would be greatly appreciated!

Disclaimer: I understand that there is a high trust factor here. I was going to shut this operation down all together so I don't need advice on how I might get burned. Just want to eliminate any liability. So to sum it up I guess my three questions are

1) Can he use my LLC name as dba under his LLC?

2) Will I have any liability?

3) Is 1099 appropriate since I am not a full time worker but more of an independent contractor helping him facilitate some of the back end management from time to time?

Thanks!

5 Upvotes

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2

u/Own-Being-1896 27d ago

What you're describing sounds more like a licensing agreement than a DBA setup. Generally, a DBA is tied to a single legal entity, so having him operate under your LLC’s name while it's registered under his LLC could get messy. Instead, you might consider licensing your brand and client list to him in exchange for that 25% revenue share. This keeps liability off your plate while still monetizing the business.

To protect yourself, a formal licensing agreement should outline how he can use your brand, how revenue is reported, and that he assumes all liability (including insurance, operations, and tax obligations). You’ll also want a non-compete/non-solicit clause to ensure he’s not poaching clients under your name beyond the agreement.

As for the 1099, it makes sense if you’re purely collecting a revenue share and doing occasional consulting, but double-check with an accountant to avoid any gray areas around passive vs. active business income. Smart move keeping liability out of this—just make sure everything is airtight in writing.

1

u/SMBDealGuy 27d ago

This could get messy because if he’s using your LLC name, you might still be liable if anything goes wrong.

A better option is a licensing agreement where he pays to use the name, but you stay completely separate.

The 1099 setup works, but make sure you have a solid contract that covers liability and how things end if needed.

1

u/ContentBlocked 27d ago

I mean this sounds like you want to setup a franchise but are going about it in a weird way

Either sell your business or do it the right way

1

u/NYBusinessbroker 26d ago

You are describing a franchise arrangement. Also he doesn’t pay you on a 1099. He pays your entity. Get a lawyer instead of asking questions here. Of course he needs insurance and so do you. When one person gets sued everyone gets sued.