A DBA stands for “Doing Business As,” and is an alias for a company or its trade under an assumed or fictitious name. When you use a DBA, you allow can run your company under names that differ from its legal name.
It looks like this,
Jane Doe LLC D/B/A Wedding Flowers by Jane.
Most states require you to file for or register any DBAs but it does vary from one state to another. They are beneficial aside from legalities. If it’s a creative name, it can be more attractive to potential customers and get more clicks and potentially more revenue. They’ve been around for generations and are a great solution for those who want to build companies in whatever direction leads them to success.
When you use trade, assumed, or fictitious names, you may need to file for a DBA to comply with the laws in the state you’re in. It can also give you the flexibility to expand and change products/services without building another business.
Businesses Who Can File for a DBA
Some states aren’t going to require you to file a DBA while others will. Some business types will need to while others won’t. Again, this really depends on the state you’re in. However, here’s a look at the kinds of businesses that may be required to register a DBA company:
Sole Proprietorships
Many states require sole proprietors or general partnerships to file for DBAs. You don’t have to file an entity formation or organization papers though. If you looking to operate a business that’s not under your name or a partner’s, you’re going to have to file for a DBA. There’s a benefit here in that it can help you form your identity as a business owner.
Franchise Businesses
Not everyone with a franchise business will have to file for a DBA but many will by choice. It lets the state and potential lenders know the name of your franchise. It also makes your business your own and makes it clear that it’s not owned by the franchisor or parent company.
Other Types of Businesses
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A corporation or LLC may have to file for a DBA. They are required to register with state governments when formed, but it can spare them from having to set up a new company if they just want to create a subsidiary.
Benefits of a DBA
You can operate under a different name and rebrand it for the sake of increased sales. When you file for a DBA, you have more flexibility to change the public name. When you have a DBA, this is really easy. For growing your business, it has its advantages too. You can expand products and services and use a new name that’s more fitting. This is simple enough to do with a DBA.
Many banks need you to have an Employer Identification Number, or EIN, to open a business bank account. A DBA makes it easy to obtain an EIN as it’s a sign of a well-run business recognized by banks. It keeps you legally compliant and protects your personal assets if you get sued. A DBA makes it evident that your business and personal assets are separate if you have a corporation or LLC.
How Do I File for a DBA?
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This varies from state to state. Filing is usually not difficult and it doesn’t cost much. You can speak to your accountant if you need assistance. Here are some points you should know:
You may have to apply to the Secretary of State or some other type of state office. County or city clerks may handle DBAs as well.
Some states offer to file a DBA online while others want you to make a personal appearance so they can witness your signature.
How your business is structured could determine whether you need to file for a DBA.
Filing for a DBA
First, check to make sure another business hasn’t taken the name you want. You can’t use your LLC, Corp. or Inc in the name you choose.
You might need to get a certificate of good standing, which can be issued by a secretary of state or government agency that deals with businesses.
A DBA will have a certain term set like 10 years for DBAs so you’ll have to renew it.
Final Thoughts
Theirs is a lot more to know when it comes to DBAs as every state has different rules. You can do some research online but you may just want to ask your accountant as they will often have all this information.
