What is a DBA and when should you use it? Using a DBA is not all that mysterious and a whole lot easier than you may think. DBA stands for “Doing Business As” and is also known as a trade name, fictitious name or assumed name. Although registering your DBA doesn’t provide legal protection, most states require you to register the fictitious name if you decide to use a business name other than your own name. Let’s back up a bit to see if using a DBA is a good idea for your business.
The purpose of the DBA is to protect consumers from dishonest companies that try to conduct business under different names to avoid run-ins with the law. If you decide to operate your business as a sole proprietorship or general partnership and you do not include the owner’s first and last name in the business name (for example, “Thomas Jones Consulting”), you are required to file a DBA so the government and consumers know who actually runs the business.
In the case of a business operating as a corporation or LLC, a DBA allows you to keep your original corporate name but operate multiple businesses under different names. For example, over the years the focus of your business may have changed, or you have branched out into other niches in your industry. Instead of having to form a completely different entity each time, you can simply register a DBA for each new business under the official corporation. In California, the law requires a DBA filing any time sole proprietors, partnerships, LLCs and corporations want to run operations and sign legal documents under a different name.
Just as with your original company or corporate name, you’ll want to make sure your DBA is available by doing a name search in your state. Doing a quick Google search isn’t enough. Be safe and check with your Secretary of State’s office or use a third-party search company.
If the DBA you want is available as a business name, you’ll want to protect it by registering for a trademark through the United States Patent and Trademark Office (USPTO) and making sure the domain name (or something close to it) is available.
Once you obtain your DBA, be sure to keep track of all the deadlines to keep protecting the name. Pay close attention to USPTO deadlines for trademark renewal as well as for any required filing deadlines in your state—typically, DBAs must be renewed every four to five years.
Advantages of a DBA
There are many reasons a DBA could be beneficial to your business. For one thing, filing a DBA could keep you in good standing with your state, especially if there possibly could be any confusion as to who owns your business. In addition, for business owners wanting to expand their markets, change their branding or branch out to other types of businesses, using a DBA is less expensive than starting new entities for each new business. Finally, you must provide a copy of your DBA before opening a business bank account and receiving payments from customers in the business’s name.
How to File a DBA
Requirements for filing a DBA vary from state to state and from county to county. Some states require you to register your DBA with the Secretary of State. In other states, registration is handled at the county level and each county has different forms and fees for the process. For example, in Texas, you register the DBA in the clerk’s office of the municipality where your company is located.
In addition, some states stipulate the DBA filing must be published within 15 to 45 days of the filing and that proof of the publication must be filed with the Secretary of State or other government office before the DBA is approved. There may also be a required number of times the notification is to appear in the publication. For instance, Minnesota requires the notice to be published in two consecutive issues of a newspaper in the county of the entity’s primary place of business. The fees for filing DBAs also vary from state to state, as do the renewal fees.
Some states give you some wiggle room when it comes to filing an application, so if you’ve already started using the DBA and haven’t filed yet, don’t panic. However, don’t wait too long, or you may have to pay a penalty.
Once your fictitious business name application has been approved, don’t delay—start using the name right away. After all, that’s what it takes to make the brand your own.