What Is A DBA?
Doing Business As, or DBA, is an acronym that permits a company to conduct business under a name other than its legal name. Additionally, DBAs are frequently employed to give a company, item, service, or location a more memorable or distinctive name. Since sole proprietorships and partnerships are needed for operation under their names, DBAs are frequently used by informal sectors like these to operate under a name that is more recognizable and credible.
Furthermore, a DBA name is referred to by several different names, depending on the region, including:
- Assumed Name
- Trade Name
- Fictitious Name
Therefore, it’s important to understand that it does not constitute a business structure in and of itself, even though it can allow a company to operate under a name other than its official legal name. For business owners who decide to operate as a sole proprietorship or partnership, it is especially crucial to stress this.
Unfortunately, it offers the owners of the business no additional liability protection because it is not a legal structure. This means that even if you operate your business under a DBA as a sole proprietor or partnership, you would still be subject to limitless personal liability for its operations.
Why Do Companies Use A DBA Name?
Here are some of the more frequent justifications offered by businesses for using a DBA name: Be aware that these factors frequently alter depending on the kind of business. For different reasons than a sole proprietorship, a corporation or LLC might decide to use an assumed name.
#1. Not conducting business under a personal name:
For general partnerships and sole proprietorships, this choice is especially crucial. If you don’t file a DBA, whenever you have to identify your business name on a public record, it will instantly be the same as your name. Therefore, you might want to rename your company for privacy reasons.
#2. You want a name that stands out more.
Additionally, a partner or sole proprietor may want the name to be more unique or to specify the type of business. If you are Peter Stones and run a digital company, your company is called Peter Stones. However, you might prefer to operate as Peter Stone’s Digital Firm. For general partnerships, the company name is the same as the names of the partners. Therefore, by applying for a DBA, you can conduct business under a fictitious name rather than your real name.
#3. You need a DBA to open a business bank account:
Banks frequently demand a DBA before opening a business bank account for sole proprietorships and partners in general partnerships. Therefore, in order to prove that you registered the name, banks frequently ask you to present them with the DBA filing or assumed name certificate.
#4. Your company is rebranding to better reflect its expansion into a new sector of the market:
When a corporation or LLC wants to enter a new industry or market new goods or services that the existing business name does not represent, a “doing business as” name is frequently used. A more evocative name might be advantageous. Consider the scenario where your company, Links Plumbing Inc., installs and repairs sprinkler systems and plans to provide snow plowing services during the winter. Therefore, for that area of your business, you could submit a DBA under the name Plowing Specialists.
#5. To operate as another company or website by using a domain name as a DBA:
A DBA can be submitted to allow a company to conduct business using its domain name. This is especially useful if the domain name for your brand is not already taken. For instance, you might want to run an additional website or business in addition to your current one. Think about your LLC producing and retailing men’s shoes. In addition, you create stylish clothes for teenagers. You submit a DBA to register the fictitious business name and develop a separate website specifically for this audience because you are aware that they wouldn’t ever buy anything from the same company or website as their fathers.
#6. To bolster the credibility of the company:
Having a DBA name can give your brand or business more legitimacy.
#7. Let people know what your DBA name and brand are:
The public record that is created when a DBA name is registered serves as notice to other businesses that the name is in use. But keep in mind that in some states, a DBA filing offers no defense against someone else registering under the same name.
#8. Use a name that is easier to remember:
The legal name might be lengthy, challenging to say or spell, hard to remember, or not search engine friendly.
How To Register For A DBA
#1. Pick Your Location:
For most small businesses, you’ll register your DBA in the same state or county where you conduct business as an LLC, corporation, partnership, or sole proprietor. However, if it makes sense for your company, you can register a DBA in a different location.
#2. Find out if a name is available:
To confirm the name is available, conduct an online search for the state or county where you want to register a DBA. Note that most states require a DBA name to be distinct and not be the same as or too similar to another DBA, LLC, or corporate name that is registered in that state or that is widely known. Therefore, to find out if a company with that name already operates in the state or county, enter the name you want to use.
#3. Obtain a state registration for your DBA:
The most crucial information is that you have to register a DBA with the same office where you registered an LLC or got your tax ID (TIN). You need to submit a DBA application by including the name you want to register as a DBA along with your business’s legal name, federal employer identification number (EIN), Social Security number, and/or state tax ID. Additionally, you can apply for it online, and once it is approved, you will receive a letter or email notification.
Note that most states and counties charge a nominal filing fee, typically $10 but sometimes as much as $100. Every one to three years, you must pay to have your registration renewed.
#5. After you have done your DBA filing:
The most significant information in this text is that the DBA may be used in company operations, such as creating a bank account and drafting contracts, once it has been accepted and officially registered. Additionally, it can be used to sell the whole company or a portion of it, as well as the DBA brand name, as intellectual property. It is not necessary to register your trade name as a trademark with the United States Patent and Trademark Office (USPTO) to make it official, but doing so will give you greater security against others using it.
How Much Does Registering A Dba Cost?
DBA filing fees vary by state but are typically between $5 and $50. Consequently, failing to register comes at a greater cost, as penalties and fees for failing to register can be several thousand dollars. This is a function of consumer protection, as the state wants to know who to contact when a consumer complains. Almost every state requires DBAs to be registered, and there is no numerical limit to how many DBAs someone can register.
Furthermore, only states like Alabama, Arizona, Nebraska, Oklahoma, and Rhode Island exempt those who operate under a DBA from registration requirements. However, it is best to inquire about regional requirements with your state.
Can I Add A Dba To My Ein?
You can think of a DBA as being comparable to a person who has a nickname. For instance, you might be called DJ even though your name is David John. In this instance, your social security card, which serves as your tax identification number, would have your real name, David John.
When you launch a company, such as one called Mellace Unlimited, you must apply for an EIN, which serves as the tax identification number for your company. You might later decide that you need to give your company a new name and image, in which case you’ll start operating under the fictitious name Outdoor World.
As a result, the new name is just a shorthand for the previous business, which already has a tax identification number registered with the IRS and doesn’t require the filing of a new one. Therefore, you wouldn’t require a new EIN for any DBA listings if the original company already had one.
How Do I Legally Write a Dba?
To run a company under a DBA, you must complete the required forms, submit them along with the required filing fee, and then obtain a DBA certificate. Depending on the state, you might have to file with a state agency, a local or county clerk’s office, or both.
Do I Need Documentation to Be a Dba?
Yes, you need documentation to be a DBA. This requires you to complete the required forms, submit them along with the required filing fee, and then obtain a certificate. Depending on the state, you might have to file with a state agency, a local or county clerk’s office, or both.
Is Dba the Same as the Legal Name?
When a person or business conducts business under a name other than its legal name, it is known as doing business (DBA). Additionally, DBAs are also known as “trade names,” “assumed names,” and “fictitious business names.” Note that there are no restrictions on how many DBAs or fictitious names a company can use.
How Much Does a DBA Cost in Massachusetts?
Filling out a business certificate form and paying a $65 fee is necessary for obtaining a DBA in Massachusetts. Note that non-residents conducting business in Massachusetts must pay an additional $35 fee.
How Much Is It to Get a DBA in New York?
The Certificate of Assumed Name in New York requires a $25 filing fee. Note that an additional county filing fee is incurred depending on the county or counties in which the corporation conducts business or intends to conduct business, in addition to the $25 New York Department of State filing fee.
How do I get a DBA in Texas?
The best way to apply for an assumed name certificate with the Secretary of State of Texas is to use a professional DBA filing service or an online application form. The filing fee for an assumed name certificate is $25 and can be paid by personal check, money order, or debit card. Note that credit card payments may be subject to a 2.7 percent fee.
How to Get a DBA in California?
The most important details are that you must register your DBA name with the county where you intend to do business and pay a fee of $26. Furthermore, if you elect to have a third party pursue the FBN registration on your behalf, then you must notarize your documents. Note that if your company is not in California, you must register with the Clerk of Sacramento County and pay $44 plus $8 for each business name or owner added to the statement.
How to Get a DBA in NY?
In New York, a DBA must be registered with the state. Applying through a reputable DBA filing service, such as ZenBusiness, is the best option. You can also submit an application using the New York DBA online form.
How to Get a DBA in Michigan?
The steps to register a Michigan fictitious name include contacting the county clerk in the location where you intend to file, obtaining licenses or permits, and visiting the U.S. Small Business Administration (SBA) website for details on industries regulated at the federal level. Note that DBA filing fees range from $10 to $16, depending on the county.
Business Names Ideas (50+ Free Brand Name Generator)
FICTITIOUS BUSINESS NAME STATEMENT: Filling a Fictitious Business Name
HOW TO TRADEMARK A BUSINESS NAME: All You Should Know & Guide
INDUSTRY ANALYSIS: What It Is & How to Write One
References:
