What meant by “Doing Business As”?
When a business owner registers with the government, they choose a legal registered name. Sometimes businesses choose to use a different name to operate under to the public, called a DBA, or doing business as. This fictitious business name filing is often used to better describe the goods or services provided to the public.
For example, a coffee shop business may have initially registered as Smith LLC because the owner’s last name is Smith. After further consideration, they created a fictitious business name called “Coffee for Coffee Lovers” to make it more clear to customers, investors, and vendors what their business did. The way the business would now write their legal entity name is “Smith LLC d/b/a Coffee for Coffee Lovers”.
Advantages of DBA Names
Using doing business as names has many benefits for business owners. During the business formation stage, it’s important for entrepreneurs to focus on legal compliance and filing for a DBA name is a great way to do that. Additionally, doing business as name filings are a great business strategy for operations like LLCs , corporations and even sole proprietorships .
Here are a few advantages of doing business as names:
- Simplicity: Sole proprietors find that using DBA names is the easiest way to form their new company. This is because they can create a business name without going through the hassle of creating a corporation or a limited liability company.
- Ability to Operate Multiple Businesses: Many corporations and LLCs operate multiple businesses at once. A DBA business name allows them to operate these businesses without setting up a separate entity for each one.
- Legal Compliance: LLCs and corporations enjoy legal protection of their personal assets since their legal filing separates their business from their personal assets. When these entities decide to operate under a different name, a DBA makes sure they stay compliant so that they have the same legal protections operating under their assumed business name.
- Privacy: Sole proprietors who run businesses often register under their legal names. However, they may want to keep their personal lives separate. Doing business as names allow sole proprietors to operate under a different name.
- To Describe a Product or Service: The name of a company tells the public a lot about what types of goods or services are offered. DBA names allow business owners to tailor creative or descriptive names for their businesses.
- Bank Account Purposes: Many banks require companies and sole proprietors to have a DBA before they will agree to open a business account. DBA filings are used in these scenarios to legitimize the proposed name on an account.
Learn more about the advantages of DBA names here .
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When Do You Need a DBA Name?
Doing business as names are a great way for companies to stay compliant with state and federal law. They can help business by allowing them to operate under a different name than originally registered. There are a few main instances in which companies need a DBA name:
To Remain Compliant
If a business wishes to operate under a different name than they have registered with the government, a DBA name is required. This helps protect the business owner by establishing a formal connection between their LLC or sole proprietorship and the fictitious business name filing they are operating under. It also protects consumers from being tricked into using a company they wouldn’t normally use on account of the name change.
Freedom to Choose Company Name
When a business owner wants to register their business name as an LLC or sole proprietorship, they are limited in the name that they can choose. If another company has already registered their name, they are legally obligated to choose a different option. Registering under a DBA solves this problem, since multiple companies can operate under the same DBA name.
Ability to Operate Multiple Businesses at Once
Registering for a DBA name allows companies to operate multiple businesses at once without going through the process of creating a new legal entity for each one. This saves time and money and allows business owners to focus on what’s most important: making profits.
Franchise Purposes
When an individual or group of individuals decides to run a franchise, it’s necessary to obtain a doing business as name for the operation. Since franchise typically come together as an LLC or a corporation, it makes it necessary for franchisees to set up DBA names so that they can run multiple businesses under the same name. This also helps to make filing taxes simpler since all the franchise locations are registered under the same umbrella company.
To Establish a New Business
If a sole proprietor wants to open a new business, filing for a doing business as name is the simplest way to do so. Since sole proprietors typically register under their legally given names, filing for a DBA is the easiest way to separate business from personal dealings legally. Filing for DBA is also the most cost-effective way to achieve this.
Get more information when a doing business as name is required here .
How to Get a DBA Name
Filing for a doing business as name is a great business strategy for many corporations, LLCs and even sole proprietors. While the exact requirements vary from state to state, the process of getting a DBA name is similar across the country.
Here is a step-by-step guide that you can use to get a DBA name for your company:
Step One: Check Your State’s Requirements
DBA name filing requirements are not universal – the rules can vary from state to state, and even from county to county. The best way to ensure that you accurately request your fictitious business name filing is to look up the requirements for your specific area. One great resource to use for this is the Small Business Administration’s website, where you can find a detailed list of requirements for your location.
Step Two: File Ahead of Time
It’s essential that a doing business as name is obtained before any goods are offered or services sold under the new name. Doing so ensures that all legal protections are in place for both business owners and consumers. It’s also helpful to file early if you want to open a business bank account, since DBA proof is required to do so.
Step Three: Consult Corporate Lawyers
While filing for a DBA name can be a simple process, it is still wise to consult an expert when filing. A professional corporate lawyer can provide specific details and insight into the DBA filing process that makes the process simpler. Having an expert on your side also ensures that petty mistakes won’t prevent you from getting approved for a DBA name.
For a more detailed look at how to get a DBA name, check out this article .
Get Help with a DBA Filing
Are you ready to get started on filing for a doing business as name but you’re not sure where to start? Consulting corporate lawyers who specialize in DBA filings is a great first step. Post a project on ContractsCounsel today to get connected with corporate lawyers who are experts in DBA filing.
